Federal Trade Commission Actions on Prescription Drugs, 2000-2022.

Importance: The Federal Trade Commission's (FTC) oversight role in the pharmaceutical market is critical to the health of patients and the health care system. This study characterized the FTC's policy on the pharmaceutical market in recent decades, identifying the types of actions it has favored, barriers it has faced, and authorities that remain untested. Objective: To review FTC legal actions in the pharmaceutical market from 2000-2022. Evidence Review: Legal actions were determined through manual review of search results from the FTC's online Legal Library as well as a 2023 FTC report on pharmaceutical actions. The alleged misconduct, type of legal action taken, timing, and outcome were collected from press releases, complaints, orders, and other legal documents. Findings: From 2000-2022, the FTC challenged 62 mergers, brought 22 enforcement actions against allegedly unlawful business practices, and made 1 rule related to pharmaceuticals. Alleged misconduct in enforcement actions involved anticompetitive settlements in patent litigation (n = 11), unilateral actions by brand manufacturers to delay generic competition (n = 6), noncompete agreements (n = 4), and monopolization (n = 3), with 10 outcomes involving monetary payment, totaling $1.6 billion. Of the 62 mergers the FTC challenged, 61 were allowed to continue, 58 after divesting certain drugs to third-party competitors. The FTC's reliance on drug divestitures decreased from 18 drugs per year from 2000-2017 to 4.3 per year from 2017-2023. Conclusions and Relevance: The FTC brought about 1 enforcement action and 3 merger actions per year against pharmaceutical manufacturers from 2000-2022, pursuing a small fraction of the estimated misconduct and consolidation in the pharmaceutical marketplace. Although the FTC faces substantial legal and practical limitations, important tools remain untested, including a rule defining "unfair methods of competition," that may allow it to more effectively prevent repetitive patterns of anticompetitive behavior.

Using Multiple Authorized Generics to Maintain High Prices: The Example of Entacapone.

OBJECTIVES: Brand-name drug manufacturers can market or license authorized generics (AGs), which are the same product sold under a generic name. By contrast, independent generics (IGs) are made by other manufacturers. The brand-name manufacturer of entacapone, a treatment for Parkinson's disease, established 4 AGs before IGs emerged. We used this case study to understand how AGs can affect the length of brand-name exclusivity and robustness of generic competition. METHODS: Using public Food and Drug Administration and court records, we identified the regulatory and legal history for generic entacapone products marketed through 2021. We used Medicare Part D data to estimate trends in use, prices, and spending on entacapone products from 2011 to 2020, comparing actual spending with projected spending if IG competition had begun after expiration of the key patent protecting entacapone (October 2013) and prices had fallen consistent with levels observed for other generic drugs. RESULTS: From 2012 to 2014, 3 potential entacapone IG manufacturers instead launched AG versions after settlement agreements with the brand-name manufacturer; the brand-name manufacturer additionally introduced its own AG. Four different IG versions were marketed beginning in 2015. From 2011 to 2020, average Medicare prices declined by 62%, less than the projected 74% to 92% price decline expected for a drug with 8 generics. Over this period, Medicare spent $1.1 billion on entacapone products, which could have been reduced by an estimated $137 to $449 million through typical IG competition. CONCLUSIONS: The case of entacapone demonstrates how licensing multiple AGs in place of IG competition can increase spending. Government regulators should more rigorously monitor AGs to prevent such strategies.

Added Therapeutic Benefit of Top-Selling Brand-name Drugs in Medicare.

Importance: The Inflation Reduction Act of 2022 authorizes Medicare to negotiate prices of top-selling drugs based on several factors, including therapeutic benefit compared with existing treatment options. Objective: To determine the added therapeutic benefit of the 50 top-selling brand-name drugs in Medicare in 2020, as assessed by health technology assessment (HTA) organizations in Canada, France, and Germany. Design, Setting, and Participants: In this cross-sectional study, publicly available therapeutic benefit ratings, US Food and Drug Administration documents, and the Medicare Part B and Part D prescription drug spending dashboards were used to determine the 50 top-selling single-source drugs used in Medicare in 2020 and to assess their added therapeutic benefit ratings through 2021. Main Outcomes and Measures: Ratings from HTA bodies in Canada, France, and Germany were categorized as high (moderate or greater) or low (minor or no) added benefit. Each drug was rated based on its most favorable rating across countries, indications, subpopulations, and dosage forms. We compared the use and prerebate and postrebate (ie, net) Medicare spending between drugs with high vs low added benefit. Results: Forty-nine drugs (98%) received an HTA rating by at least 1 country; 22 of 36 drugs (61%) received a low added benefit rating in Canada, 34 of 47 in France (72%), and 17 of 29 in Germany (59%). Across countries, 27 drugs (55%) had a low added therapeutic rating, accounting for $19.3 billion in annual estimated net spending, or 35% of Medicare net spending on the 50 top-selling single-source drugs and 11% of total Medicare net prescription drug spending in 2020. Compared with those with high added benefit, drugs with a low added therapeutic rating were used by more Medicare beneficiaries (median 387 149 vs 44 869) and had lower net spending per beneficiary (median $992 vs $32 287). Conclusions and Relevance: Many top-selling Medicare drugs received low added benefit ratings by the national HTA organizations of Canada, France, and Germany. When negotiating prices for these drugs, Medicare should ensure they are not priced higher than reasonable therapeutic alternatives.

Evaluation of confounding in epidemiologic studies assessing alcohol consumption on the risk of ischemic heart disease.

BACKGROUND: Among different investigators studying the same exposures and outcomes, there may be a lack of consensus about potential confounders that should be considered as matching, adjustment, or stratification variables in observational studies. Concerns have been raised that confounding factors may affect the results obtained for the alcohol-ischemic heart disease relationship, as well as their consistency and reproducibility across different studies. Therefore, we assessed how confounders are defined, operationalized, and discussed across individual studies evaluating the impact of alcohol on ischemic heart disease risk. METHODS: For observational studies included in a recent alcohol-ischemic heart disease meta-analysis, we identified all variables adjusted, matched, or stratified for in the largest reported multivariate model (i.e. potential confounders). We recorded how the variables were measured and grouped them into higher-level confounder domains. Abstracts and Discussion sections were then assessed to determine whether authors considered confounding when interpreting their study findings. RESULTS: 85 of 87 (97.7%) studies reported multivariate analyses for an alcohol-ischemic heart disease relationship. The most common higher-level confounder domains included were smoking (79, 92.9%), age (74, 87.1%), and BMI, height, and/or weight (57, 67.1%). However, no two models adjusted, matched, or stratified for the same higher-level confounder domains. Most (74/87, 85.1%) articles mentioned or alluded to "confounding" in their Abstract or Discussion sections, but only one stated that their main findings were likely to be affected by residual confounding. There were five (5/87, 5.7%) authors that explicitly asked for caution when interpreting results. CONCLUSION: There is large variation in the confounders considered across observational studies evaluating the impact of alcohol on ischemic heart disease risk and almost all studies spuriously ignore or eventually dismiss confounding in their conclusions. Given that study results and interpretations may be affected by the mix of potential confounders included within multivariate models, efforts are necessary to standardize approaches for selecting and accounting for confounders in observational studies.

Estimated Medicare Part B Savings From Inflationary Rebates.

This study uses annual Medicare Part B spending data to examine the potential savings from the drug pricing reforms in the Inflation Reduction Act of 2022.

Use of Efficiency Frontiers to Align Prices and Clinical Benefits of Biologic Therapies for Plaque Psoriasis.

Importance: The US lacks a systematic approach for aligning drug prices with clinical benefit, and traditional cost-effectiveness analysis (CEA) faces political obstacles. The efficiency frontier (EF) method offers policymakers an alternative approach. Objective: To assess how the EF approach could align prices and clinical benefits of biologic medications for plaque psoriasis and estimate price reductions in the US vs 4 peer countries: Australia, Canada, France, and Germany. Design and Setting: This health economic evaluation used the EF approach to compare the prices and clinical benefits of 11 biologics and 2 biosimilars for plaque psoriasis in the US, Australia, Canada, France, and Germany. Data were collected from February to March 2023 and analyzed from March to June 2023. Main Outcome Measures: EFs were constructed based on each biologic's efficacy, measured using the Psoriasis Area and Severity Index (PASI) 90 response rate, and annual treatment cost as of January 2023; US costs were net of estimated manufacturer rebates. Prices based on the EF were compared with traditional CEA-based prices calculated by the Institute for Clinical and Economic Review at a threshold of $150 000 per quality-adjusted life-year gained. Results: Among 13 biologics, PASI 90 response rates ranged from 17.9% (etanercept) to 71.6% (risankizumab); US net annual treatment costs ranged from $1664 (infliximab-dyyb) to $79 277 (risankizumab). The median (IQR) net annual treatment cost was higher in the US ($34 965 [$20 493-$48 942]) than prerebate costs in Australia ($9179 [$6691-$12 688]), Canada ($15 556 [$13 017-$16 112]), France ($9478 [$6637-$11 678]), and Germany ($13 829 [$13 231-$15 837]). The US EF included infliximab-dyyb (PASI 90: 57.4%; annual cost: $1664), ixekizumab (PASI 90: 70.8%; annual cost: $33 004), and risankizumab (PASI 90: 71.6%; annual cost: $79 277). US prices for psoriasis biologics would need to be reduced by a median (IQR) of 71% (31%-95%) to align with those estimated using the EF; the same approach would yield smaller price reductions in Canada (41% [6%-57%]), Australia (36% [0%-65%]), France (19% [0%-67%]), and Germany (11% [8%-26%]). Except for risankizumab, the EF-based prices were lower than the prices based on traditional CEA. Conclusions and Relevance: This economic evaluation showed that for plaque psoriasis biologics, using an EF approach to negotiate prices could lead to substantial price reductions and better align prices with clinical benefits. US policymakers might consider using EFs to achieve prices commensurate with comparative clinical benefits, particularly for drug classes with multiple therapeutic alternatives for which differences can be adequately summarized by a single outcome measurement.

Simulated Medicare Drug Price Negotiation Under the Inflation Reduction Act of 2022.

Importance: The Inflation Reduction Act of 2022 gives Medicare the authority to negotiate prices for certain prescription drugs. Which drugs will be selected and how prices will be negotiated remain unclear. Objective: To simulate drug selection and the minimum savings that would have been achieved at statutory ceiling prices if Medicare drug price negotiation had been implemented from 2018 to 2020. Design, Setting, and Participants: In this cross-sectional study, a policy simulation analysis of high-spending prescription drugs in Medicare Part B and Part D that were eligible for negotiation from January 2018 to December 2020 was performed from August 5 to November 20, 2022. Exposures: Eligibility criteria for selection and discounts afforded by the statutory ceiling prices for negotiation. Main Outcomes and Measures: The main outcomes were characteristics of drugs subject to negotiation and estimated Medicare savings from 2018 to 2020 that would have been achieved through spending at ceiling prices compared with existing net prices accounting for price concessions. Results: Among the 40 selected drugs, 35 were primarily reimbursed through Medicare Part D and 5 through Part B and 10 were biologics. The most common therapeutic classes were endocrine (11), neurologic or psychiatric (5), pulmonary (4), rheumatologic or immunologic (4), and cardiovascular (4). Median time from US Food and Drug Administration approval to selection was 12 years (IQR, 10-14 years). Three drugs faced generic competition in the 2 years between selection and price negotiation. For the remaining 37 drugs, estimated net Medicare spending from 2018 to 2020 was $55.3 billion; spending at ceiling prices would have been reduced by an estimated $26.5 billion, which represented 5% of estimated net Medicare drug spending during those 3 years. Conclusions and Relevance: In this cross-sectional study, simulating the drug price negotiation provisions in the Inflation Reduction Act of 2022 revealed important limitations, including strict selection criteria and the potential for drugs to become ineligible for negotiation during the 2 years between selection and prices taking effect. Despite these limitations, the policy still delivered substantial savings because ceiling prices offered steep discounts, in part, by erasing excess spending from price increases faster than inflation.

Spending by the Centers for Medicare & Medicaid Services Before and After Confirmation of Benefit for Drugs Granted US Food and Drug Administration Accelerated Approval, 2012 to 2017.

Importance: Accelerated approval by the US Food and Drug Administration (FDA) grants market authorization for drugs based on clinical trials using surrogate end points likely to anticipate a clinical benefit. The FDA requires postapproval trials to confirm benefit, after which the accelerated approval is converted to a standard approval or is withdrawn. However, trials frequently fail to assess clinical benefit, and expenditure for these drugs may be substantial. Objective: To evaluate spending by the Centers for Medicare & Medicaid Services (CMS) on drugs granted FDA accelerated approval before and after confirmation of benefit. Design and Setting: This was a cross-sectional study of CMS spending on drugs granted FDA accelerated approval for original indications from 2012 to 2017, with follow-up through 2020. Using data from the Drugs@FDA database and a validated methodology, the characteristics of new drugs granted FDA accelerated approval were identified and analyzed, including indication area, type of drug, type of confirmatory trial end point, orphan designation, number of supplemental indications, and conversion status. Main Outcomes and Measures: Overall and annualized spending by Medicare Parts B and D and Medicaid from 2012 to 2020, before and after conversion to standard approval. Analyses were conducted from June 30, 2021, to March 21, 2022. Results: From 2012 to 2017, the FDA granted accelerated approval to 38 drugs for 42 original indications. Through 2020, CMS spending for these drugs was $67.9 billion (median [IQR], $329.3 million [$54.4 million-$1.6 billion]). For 22 drugs (58%) that were converted to standard approval on the basis of clinical trial results, annualized spending increased substantially after conversion ($35.0 million vs $199.0 million), and spending after conversion accounted for $51.0 billion (75%) of overall spending. However, only 6 conversions (27%) of the 22 were supported by confirmatory trials evaluating clinical outcomes as primary end points. Drugs evaluated using surrogate end points accounted for $40.3 billion (59%) of CMS spending. Conclusions and Relevance: The findings of this cross-sectional study indicate that most of the drugs granted FDA accelerated approval for original indications from 2012 to 2017 lacked confirmatory trials evaluating clinical outcomes to support conversion to standard approval. Automatic coverage mandates produced substantial CMS spending for drugs with unproven clinical benefits.

Evaluation of Trials Comparing Single-Enantiomer Drugs to Their Racemic Precursors: A Systematic Review.

Importance: Chiral switching, a strategy in which drug manufacturers develop a single-enantiomer formulation of a drug to be substituted for a racemic formulation, allows manufacturers to maintain market exclusivity for drugs losing patent protection, even without demonstrating superior efficacy or safety. Objective: To identify and characterize all randomized clinical trials (RCTs) directly comparing a Food and Drug Administration (FDA)-approved single-enantiomer drug against a previously approved racemic drug for 1 or more efficacy or safety end points. Evidence Review: Drugs were identified using the Drugs@FDA database. Randomized clinical trials were identified using Ovid MEDLINE (1949 to October 22, 2019), Ovid Embase (1974 to October 22, 2019), Web of Science Core Collection (all years), ClinicalTrials.gov, and Cochrane Central Registry of Controlled Trials (CENTRAL, Wiley, Issue 8 of 12, October 22, 2019). Trials were characterized as favoring the single-enantiomer or racemic drugs based on whether the primary efficacy, secondary efficacy, and safety end points achieved each study's defined significance level (eg, P < .05). Trials were characterized as favoring neither drug if no statistically significant differences were reported for any end point or if both drugs were found to be superior for 1 or more separate end points. Findings: Fifteen FDA-approved single-enantiomer drugs were identified with racemic precursors approved in the US or Europe. For 3 single-enantiomer racemic drug pairs, no RCTs directly comparing the drugs were identified. For the remaining 12 pairs, 185 RCTs comparing efficacy or safety of the drug pairs were identified, 124 (67.0%) of which studied 1 pair (levobupivacaine/bupivacaine). There were 179 RCTs directly comparing drug pairs using efficacy end points, of which 23 (12.8%) favored the single enantiomer based on primary efficacy end point results. There were 124 RCTs directly comparing drug pairs using safety end points, of which 17 (13.7%) favored the single-enantiomer drug. For 9 of the 15 single-enantiomer drugs (60.0%), no RCTs were identified providing evidence of improved efficacy, based on primary end point results, or safety as compared with their racemic precursors. Conclusions and Relevance: The results of this systematic review suggest that most newly marketed FDA-approved single-enantiomer drugs are infrequently directly compared with their racemic precursors, and when compared, they are uncommonly found to provide improved efficacy or safety, despite their greater costs.

Transparency of Regulatory Data across the European Medicines Agency, Health Canada, and US Food and Drug Administration.

Based on an analysis of relevant laws and policies, regulator data portals, and information requests, we find that clinical data, including clinical study reports, submitted to the European Medicines Agency and Health Canada to support approval of medicines are routinely made publicly available.