News & Views: 2/2 - 2/8

February 9, 2021

The Congressional Budget Office (CBO) released its working paper on their model of drug price negotiations under the Elijah E. Cummings Lower Drug Costs Now Act.

The paper describes the simulation model that was used to inform their score, in addition to the data sources, parameter values, and sensitivity of the results. The model used a Nash bargaining framework, which was based on gains from a successful negotiation for both the federal government and the manufacturer. The CBO report also stated that they relied on both QALY and ICER data to arrive at their estimates of the budgetary effects of H.R. 3. To review the full paper, click here.

  • To review the CBO score of H.R. 3, click here.

Senators Cassidy, Baldwin, and Shaheen introduced a bipartisan bill to close the orphan drug loophole.

The bill will allow the FDA to remove market exclusivity from a drug if the manufacturer fails to prove that the drug would not be economically viable with competition. The goal of the bill is to encourage market competition by reducing the abuse of the default seven years of market exclusivity that drug companies are granted. To read the press release, click here.

A KFF analysis found half of Part D drugs’ list prices increased beyond the rate of inflation between July 2018 and July 2019.

Both the House of Representatives and Senate Finance Committee have previously proposed bills that would limit price increases beyond the rate of inflation, but neither made it to a Senate floor vote. KFF’s analysis attempts to contextualize why these or similar legislation should be brought back to the now Democratic-controlled Congress. Between July 2018 and July 2019, the rate of inflation was 1.8%, but the median list price increase was 6.4% (3.5 times the rate of inflation). The analysis also found that the price of 22 of the 25 drugs with the highest Medicare Part D spending in 2019 increased faster than inflation, ranging from a 3.0% to a 19.7% price increase. To review the complete analysis, click here.

The healthcare consulting group, Vizient, has released their annual Pharmacy Market Outlook report.

The report projected that while pharmaceutical prices will continue to rise, the increase will continue to trend downward. The 2021 report projects that the overall trend towards moderate price increases will continue through 2022, due to recent generic options and the increase in biosimilars. The report also claimed that biosimilars will have the greatest impact on the market yet, over the next 5 years. To read the full report, click here.

CIDSA Experts in the News

Stacie Dusetzina will be giving an open lecture, “Balancing Innovation and Access: Can We Lower Drug Prices in a Pandemic”, on April 30. The Charles C. Leighton, MD memorial lecture will be moderated by Dan Gorenstein from the Tradeoffs podcast. To read more about the lecture, click here.

Sean Dickson’s recent work on COVID-19 vaccine distribution has been mentioned in various publications. Dickson, along with UPitt researchers, developed a series of maps that display possible COVID-19vaccine administration sites across the country. The maps can display how many facilities there are to administer the vaccine per 10,000 residents, how many residents live within a 10-mile radius of a vaccination facility, with particular attention to how far seniors live from a given facility. Dickson and the researchers also looked at the potential racial disparities in access to the vaccination sites they identified. To read the Philadelphia Inquirer article on the VaxMap, click here. To see the interactive VaxMap, click here.

Mariana Socal contributed to a Johns Hopkins report that identified multiple problems in the drug supply chain and then recommended specific policy changes that could resolve them. The report discusses gaps in the production and distribution of pharmaceuticals that were caused or heightened by the COVID-19 pandemic. To read the article, click here. To read the full study, click here.

Ameet Sarapatwari and Rachel Sachs both talked with Pink Sheet writer Sarah Karlin-Smith on the impact that controlled pricing power could have on pharmaceutical innovation. The paper discusses how the COVID-19 vaccine contracts do not necessarily translate to other drugs and that reference pricing would have a limited impact on lowering drug costs. To read the full article, click here.

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