The Reduced Costs and Continued Cures Act (RCCCA), introduced by Representatives Scott Peters (D-CA 52) and Kurt Schrader (D-OR 5) aims to lower drug costs for patients without risking future innovative cures. One provision in the bill establishes payment rules for negotiation eligible drugs and biologics (Sec. 101). For this survey, experts were asked to limit their analysis to that section of the bill.
RCCCA would permit Medicare negotiation on a limited subset of Medicare Part B drugs and biologics that no longer have any FDA exclusivity protections and for which any patents issued up to 1 year after approval have expired. The price for an eligible drug or biologic is then negotiated for by the Secretary of HHS and the manufacturer. If the Secretary and manufacturer cannot agree on a maximum allowable price, the Secretary determines the maximum allowable cost between 65-75% the Average Sales Price (ASP) in the year before negotiation.
The CIDSA experts agreed that the Reduced Costs and Continued Cures Act would reduce drug spending; 7 experts believe the policy would minimally reduce spending, while the other one believes it could moderately reduce spending. While they do not believe the policy would affect list prices, the experts unanimously agreed that it would moderately decrease drug net prices. The panel also unanimously agreed that the RCCCA would moderately increase drug access for Medicare beneficiaries, while there would be no change in access for other patient groups.
All of the experts opined that Rep. Peters and Schrader’s bill would advance drug spending policy, but were spilt on if it would be a minimal or moderate advancement. The experts agreed that the ability to be implemented and the precedent-setting value of the policy should be considered strengths. The size of the affected population and the magnitude of the impact that it would have on drug spending are both weaknesses, while experts were unable to determine if the evidence base in support of the policy is a weakness or strength.
Only 8 experts were able to participate in this survey.
The expert panel highlighted several policy concerns for policymakers to consider. Most notably, the uncertainty surrounding which patents or market exclusivities would take precedence for defining eligibility for negotiation, if the policy would increase incentives for companies to over-patent their products, and how manufacturers could manipulate their ASP in the year before they are eligible for negotiation. Another key consideration is that brand manufacturers could create their own biosimilar or generic products to prevent the penalty. Policymakers should also consider the possible impact this could have on innovation, how biologic patents would be identified, and how line extensions or additional indications would be handled under this policy.