Trends in HIV preexposure prophylaxis utilization and spending among individuals with commercial insurance.

In a cross-sectional analysis of HIV preexposure prophylaxis (PrEP) utilization by commercially insured patients from 2019 to 2021, most prescriptions were for branded formulations of PrEP despite the availability of a generic version. Accounting for the modest relative clinical benefit of branded TAF/FTC (tenofovir alafenamide fumarate/emtricitabine) PrEP over generic TDF/FTC (tenofovir disoproxil fumarate/emtricitabine) PrEP, use of generic TDF/FTC PrEP would have reduced commercial insurers' spending by 33%.

Trends in Proportion of Medicare Part D Claims Subject to 340B Discounts, 2013-2020.

Importance: Despite controversy surrounding the 340B program, no study has analyzed trends in the proportion of Medicare Part D pharmacy claims eligible for 340B discounts. Objective: To describe trends in the proportion of Medicare Part D claims that are prescribed by 340B-affiliated clinicians and filled in 340B pharmacies. Design and Setting: This longitudinal, retrospective cohort study included 2013 to 2020 claims data from a 5% random sample of Medicare Part D beneficiaries from the Centers for Medicare & Medicaid Services and 6292 nine-digit national drug codes that were used by at least 1000 Part D beneficiaries in a given year. Data analysis was completed from November 2022 to April 2023. Main Outcomes and Measures: For each drug and year, there were 3 outcomes: (1) proportion of total Part D claims that were prescribed by a 340B-affiliated clinician; (2) proportion of claims prescribed by a 340B-affiliated clinician that were filled in a 340B pharmacy; and (3) proportion of total Part D claims under the 340B program (ie, prescribed by a 340B-affiliated clinician and filled in a 340B pharmacy). Results: The proportion of prescriptions written by a 340B-affiliated clinician doubled from 9.4% in 2013 to 19.3% in 2020. The capture of 340B prescriptions by 340B pharmacies, defined as the proportion of claims prescribed by 340B-affiliated clinicians that were filled by 340B pharmacies, increased from 18.4% in 2013 to 49.9% in 2020. As a result, the total proportion of 340B claims in Part D increased from 1.7% in 2013 to 9.6% in 2020. Rates of 340B prescribing and capture increased consistently across therapeutic classes. In 2020, the antiviral therapeutic class was the class with the largest proportion of 340B claims (16.1%), followed by targeted antineoplastics (15.7%). Conclusions and Relevance: This cohort study demonstrated that from 2013 to 2020, the share of Medicare Part D claims prescribed by a 340B-affiliated clinician increased; however, the rate at which 340B-eligible prescriptions were filled at 340B pharmacies increased at a faster rate, driving the overall increase in 340B claims. Despite these trends, only half of 340B-eligible prescriptions were subject to the 340B discount in 2020.

Nonfederal average manufacturer price to estimate savings generated by minimum discounts under the Inflation Reduction Act.

DISCLOSURES: This work was funded by the West Health Policy Center. Dr Hernandez reports consulting fees from Pfizer and BMS, outside of the submitted work. Following the submission of the original manuscript, Dr Dickson became an employee of AHIP. AHIP has had no role in reviewing this letter. The statements, findings, conclusions, views, and opinions contained and expressed herein are not necessarily those of IQVIA Inc. or any of its affiliated or subsidiary entities.

Medicare Part B Spending on Macular Degeneration Treatments Associated With Manufacturer Payments to Ophthalmologists.

Importance: Age-related macular degeneration (ARMD) therapies aflibercept and ranibizumab are among the highest-cost Medicare Part B drugs, even though off-label use of lower-cost bevacizumab is clinically noninferior. Payments from manufacturers of these ARMD therapies to ophthalmologists are hypothesized to be factors in ophthalmologists' therapeutic choice, controlling for ophthalmologist and patient characteristics. Objective: To assess the association between manufacturer payments to ophthalmologists and choice of ARMD treatment as well as to identify ophthalmologist-level characteristics associated with prescribing lower-cost ARMD therapies. Design, Setting, and Participants: This retrospective cross-sectional study of longitudinal (2013-2019) Medicare Part B data was conducted from December 2021 to December 2022. Ophthalmologists prescribing aflibercept (manufactured by Regeneron Pharmaceuticals Inc), rabinizumab, or bevacizumab (both manufactured by Genentech Inc) for ARMD treatment of Medicare Part B beneficiaries were included. Data on manufacturer payments to ophthalmologists were obtained from the Open Payments database. Main Outcomes and Measures: The primary outcome was the percentage of bevacizumab prescribed by ophthalmologists among all ARMD therapies. Regression analysis assessed variation in bevacizumab prescribing by acceptance of manufacturer payments as well as by ophthalmologist and patient characteristics. Ophthalmologist characteristics were duration of practice and Medicare Administrative Contractor region, and patient characteristics were aggregated at the ophthalmologist level and included mean beneficiary age, percentage of dual-eligible beneficiaries, mean beneficiary risk score, and percentage of White beneficiaries. Savings were estimated by projecting the change in bevacizumab use had ophthalmologists not accepted manufacturer payments, controlling for all ophthalmologist and patient characteristics and comparing with observed use and costs. Results: A total of 21 584 ophthalmologists (18 489 males [85.7%]) were included. Ophthalmologists who accepted manufacturer payments were significantly less likely to prescribe bevacizumab (28.0% [95% CI, 24.6%-42.5%] of patients) compared with those who did not accept manufacturer payments (45.8% [95% CI, 44.5%-47.1%]). Ophthalmologists who saw dual-eligible beneficiaries had greater bevacizumab prescribing (50.0% [95% CI, 40.6%-68.3%] in the highest quartile vs 36.1% [95% CI, 33.5%-38.8%] in the lowest quartile; ß coefficient, 0.139; P < .001), while those who saw patients with higher mean beneficiary risk scores had lower bevacizumab use (38.0% [95% CI, 23.7%-44.1%] in the highest quartile vs 48.2% [95% CI, 45.5%-50.8%] in the lowest quartile; ß coefficient, -0.102, P < .001). Had ophthalmologists who accepted manufacturer payments prescribed ARMD drugs as those who did not accept payments, Medicare spending on these treatments would have been $642 779 703.08 lower from 2013 to 2019, a 2.0% savings. Conclusions and Relevance: Results of this cross-sectional study suggest that drug manufacturer payments to ophthalmologists were associated with selection of higher-cost therapies for ARMD, which is a factor in increased Medicare and patient spending. Development of manufacturer payment models that encourage ophthalmologists to choose lower-cost therapies are needed.

Changes In Net Prices And Spending For Pharmaceuticals After The Introduction Of New Therapeutic Competition, 2011-19.

Previous research has demonstrated that the introduction of a new brand-name pharmaceutical competitor does not lower list prices for existing competitive therapies. However, no study has systematically evaluated the impact of new therapeutic competition on net prices of pharmaceutical products. We identified new therapies approved during the period 2013-17 that were competitors for existing treatments. We used a novel peer-reviewed algorithm to estimate the net prices of existing therapies. We implemented regression models to estimate changes in these net prices after the approval of the new therapeutic competition during the period 2011-19. Across twelve therapeutic classes with new drug entrants in 2013-17, the introduction of new therapeutic competition was associated with a 4.2 percent decrease in annual net price growth. The introduction of new brand-name therapies in twelve therapeutic classes reduced net commercial spending on existing therapies by $10.4 billion-an 18.5 percent reduction in projected spending absent therapeutic competition. Our findings demonstrate that new therapeutic competition allows pharmacy benefit managers to use formulary management to decrease net prices and reduce drug spending, contrary to observed trends in list price increases.

Contextualizing the Price of Biosimilar Adalimumab Based on Historical Rebates for the Original Formulation of Branded Adalimumab.

This cross-sectional study compares recent list and net prices for Humira after rebates with announced prices of interchangeable biosimilar Humira formulations.

Estimated discounts generated by Medicare drug negotiation in 2026.

BACKGROUND: Starting in 2026, Medicare will be able to negotiate drug prices. Although recent reports have identified the drugs that will likely face negotiation, no study has estimated the maximum negotiated price according to guidance from the Centers for Medicare and Medicaid Services. OBJECTIVE: To identify the maximum negotiated price for the 10 drugs expected to be negotiated by Medicare in 2026. METHODS: We apply peer-reviewed methodology to estimate 2020 rebates for the 10 drugs anticipated to be negotiated by Medicare in 2026. We compare rebates to the statutory minimum discounts to identify the maximum negotiated price in 2026 and estimate savings. RESULTS: The minimum discount stipulated by the Inflation Reduction Act exceeds 2020 rebates for 4 of the 10 drugs expected to be negotiated in 2026, including etanercept, which is subject to a minimum discount of 60%, compared with an estimated rebate of 39.1%, and the cancer drugs ibrutinib, palbociclib, and enzalutamide, all of which will be subject to a minimum discount of 25%, compared with estimated rebates of 9%, 5.7% and 15.0%, respectively. Based on 2020 gross spending, the minimum required discount on these 4 drugs would generate savings of $1.8 billion. CONCLUSIONS: In 2026, minimum discounts will only apply to 4 of 10 drugs likely subject to negotiation. For most drugs, net prices will establish the ceiling for the negotiated price. To achieve the savings projected by the Congressional Budget Office ($3.7 billion), negotiated prices will have to fall below the ceiling for the negotiated price established by the statute. DISCLOSURES: This work was funded by the West Health Policy Center. Dr Hernandez reports consulting fees from Pfizer and Bristol Meyers Squibb, outside of the submitted work. Following the submission of this manuscript, Mr Dickson became an employee of American's Health Insurance Plans. American's Health Insurance Plans had no role in reviewing this manuscript. The statements, findings, conclusions, views, and opinions contained and expressed herein are not necessarily those of IQVIA Inc. or any of its affiliated or subsidiary entities.

Association between distance to community health care facilities and COVID-19-related mortality across U.S. counties in the COVID-19-vaccine era.

OBJECTIVE: COVID-19 has caused tremendous damage to U.S. public health, but COVID vaccines can effectively reduce the risk of COVID-19 infections and related mortality. Our study aimed to quantify the association between proximity to a community healthcare facility and COVID-19 related mortality after COVID vaccines became publicly available and explore how this association varied across racial and ethnic groups. RESULTS: Residents living farther from a facility had higher COVID-19-related mortality across U.S. counties. This increased mortality incidence associated with longer distances was particularly pronounced in counties with higher proportions of Black and Hispanic populations.

Assessment of Commercial and Mandatory Discounts in the Gross-to-Net Bubble for the Top Insulin Products From 2012 to 2019.

Importance: Insulin list prices have grown substantially since 2010, but net prices have declined since 2015 because of manufacturer discounts, leading to an increasingly large difference between list and net prices of drugs often called the gross-to-net bubble. It remains unclear to what extent the gross-to-net bubble represents voluntary manufacturer discounts negotiated in commercial and Medicare Part D markets (hereafter called commercial discounts) vs mandatory discounts under the Medicare Part D coverage gap, Medicaid, and the 340B program. Objective: To decompose the overall gross-to-net bubble of leading insulin products into discount types. Design, Setting, and Participants: This economic evaluation obtained data from Medicare and Medicaid claims and spending dashboards, Medicare Part D Prescriber Public Use File, and SSR Health for the top 4 commonly used insulin products: Lantus, Levemir, Humalog, and Novolog. The gross-to-net bubble, which represents total discounts, was estimated for each insulin product and year (from 2012 to 2019). Analyses were conducted in June to December 2022. Main Outcomes and Measures: The gross-to-net bubble was decomposed into 4 discount types: (1) Medicare Part D coverage gap discounts, (2) Medicaid discounts, (3) 340B discounts, and (4) commercial discounts. Coverage gap discounts were estimated using Medicare Part D claims data. Medicaid and 340B discounts were estimated using a novel algorithm that accounted for best prices set by commercial discounts. Results: Total discounts for the 4 insulin products increased from $4.9 billion to $22.0 billion. Commercial discounts represented a majority of all discounts, increasing from 71.7% of the gross-to-net bubble in 2012 ($3.5 billion) to 74.3% ($16.4 billion) in 2019. Among mandatory discounts, coverage gap discounts remained relatively consistent as a proportion of discounts (5.4% in 2012 vs 5.3% in 2019). Medicaid rebates decreased as a proportion of total discounts, from 19.7% in 2012 to 10.6% in 2019. The 340B discounts increased as a proportion of total discounts from 3.3% in 2012 to 9.8% in 2019. Results for the contribution of discount types to the gross-to-net bubble were consistent across insulin products. Conclusions and Relevance: Results of a decomposition of the gross-to-net bubble for leading insulin products suggest that commercial discounts play a growing role in lowering net sales compared with mandatory discounts.

Estimated Changes in Insulin Prices and Discounts After Entry of New Insulin Products, 2012-2019.

Importance: Despite the political salience of insulin prices, no study to date has quantified trends in insulin prices that account for manufacturer discounts (net prices). Objective: To describe trends in insulin list prices and net prices faced by payers from 2012 to 2019 and estimate changes in net prices after the 2015 to 2017 entry of new insulin products. Design, Setting, and Participants: This longitudinal study included an analysis of Medicare, Medicaid, and SSR Health drug pricing data from January 1, 2012, to December 31, 2019. Data analyses were performed from June 1, 2022, to October 31, 2022. Exposures: US sales of insulin products. Main Outcomes and Measures: Net prices faced by payers were estimated for insulin products as list prices minus manufacturer discounts negotiated in commercial and Medicare Part D markets (ie, commercial discounts). Trends in net prices were evaluated before and after the entry of new insulin products. Results: Net prices of long-acting insulin products increased at an annual rate of 23.6% from 2012 to 2014 but decreased at an annual rate of 8.3% after the introduction of insulin glargine (Toujeo and Basaglar) and degludec (Tresiba) in 2015. Net prices of short-acting insulin increased at an annual rate of 5.6% from 2012 to 2017 but then decreased from 2018 to 2019 after the introduction of insulin aspart (Fiasp) and lispro (Admelog). For human insulin products, which did not experience entry of new products, net prices increased at an annual rate of 9.2% from 2012 to 2019. From 2012 to 2019, commercial discounts increased from 22.7% to 64.8% for long-acting insulin products, from 37.9% to 66.1% for short-acting insulin products, and from 54.9% to 63.1% for human insulin products. Conclusions and Relevance: In this longitudinal study of US insulin products, results suggest that insulin prices substantially increased from 2012 to 2015, even after accounting for discounts. The introduction of new insulin products was followed by substantial discounting practices that lowered net prices faced by payers.

Comparison of Generic Prescribing Patterns Among 340B-Eligible and Non-340B Prescribers in the Medicare Part D Program.

This cross-sectional study examines generic prescribing patterns for 2020 among 340B-eligible and non-340B clinicians in the Medicare Part D program to assess whether 340B revenue incentives may influence prescribing.

Racial disparities in access to health care infrastructure across US counties: A geographic information systems analysis.

Infrastructure system in the U.S. have been shown to be linked to social and health inequities. We calculated driving distance to the closest health care facility for a representative sample of the U.S. population using ArcGIS Network Analyst and a national transportation dataset, and identified areas where Black residents have a longer driving distance to the closest facility than White residents. Our data demonstrated that racial disparities in access to health care facilities presented large geographic variation. Counties with significant racial disparities were concentrated in the Southeast and did not correspond to counties with a greater proportion of the overall population >5 miles to the closest facility, which were concentrated in the Midwest. This geographic variation demonstrates the need to adopt a spatially explicit data driven approach in the design of equitable health care facility establishment that address the specific limitations of the local infrastructure.

Drugs likely subject to Medicare negotiation, 2026-2028.

BACKGROUND: After the passage of the Inflation Reduction Act, Medicare will be able to negotiate drug prices starting in 2026. The Congressional Budget Office has estimated the total savings achieved each year for negotiation but has not publicly identified the drugs anticipated to be negotiated each year. OBJECTIVE: To identify the drugs expected to be negotiated by Medicare in 2026-2028. METHODS: We identify drugs expected to be negotiated by the Centers for Medicare & Medicaid Services in 2026-2028 based on the statutory criteria, Part B and Part D gross spending in 2020, and estimates of when a drug will be subject to generic or biosimilar competition. We also identify the reasons why other high-spend drugs will be ineligible for negotiation. RESULTS: In 2026-2028, we estimate that Medicare will negotiate prices for 38 Medicare Part D drugs and 2 Part B drugs. Combined, the 40 products eligible for negotiation in 2026-2028 accounted for $67.4 billion in gross Medicare spending in 2020. Part D drugs eligible for negotiation in 2026-2028 include 7 inhalers, 8 antidiabetics, 5 kinase inhibitors, and 3 oral anticoagulants. In all but 5 cases, high-spend drugs ineligible for negotiation were disqualified because of generic or biosimilar competition. CONCLUSIONS: Medicare drug price negotiation has the potential to benefit Medicare beneficiaries across some of the most common disease states. By generating the list of drugs likely subject to Medicare negotiation in the initial years, we hope to provider researchers, policymakers, prescribers, and patient advocates with expectations on which drugs are expected to see reductions in beneficiary cost sharing. DISCLOSURES: This work was funded by the West Health Policy Center. Dr Hernandez reports consulting fees from Pfizer and Bristol Myers Squibb, outside of the submitted work.

Estimated changes in price discounts for tenofovir-inclusive HIV treatments following introduction of tenofovir alafenamide.

We estimated list and net prices for tenofovir disoproxil fumarate (TDF) products Truvada, Complera, and Stribild, and their tenofovir alafenamide (TAF) versions Descovy, Odefsey, and Genvoya. Gilead offered discounts for Descovy that resulted into lower net prices compared to Truvada. This strategy encouraged patients switching from Truvada to Descovy before the availability of generic Truvada. Conversely, Gilead offered lower discounts for Odefsey and Genvoya, which resulted into higher net prices compared to Complera and Stribild.

Access to community pharmacies: A nationwide geographic information systems cross-sectional analysis.

BACKGROUND: Pharmacy accessibility is key for the emerging role of community pharmacists as providers of patient-centered, medication management services in addition to traditional dispensing roles. OBJECTIVE: To quantify population access to community pharmacies across the United States. METHODS: We obtained addresses for pharmacy locations in the United States from the National Council for Prescription Drug Programs and geocoded each. For a 1% sample of a U.S. synthetic population, we calculated the driving distance to the closest pharmacy using ArcGIS. We estimated the proportion of population living within 1, 2, 5, and 10 miles of a community pharmacy. We quantified the role of chain vs regional franchises or independently owned pharmacies in providing access across degrees of urbanicity. RESULTS: We identified 61,715 pharmacies, including 37,954 (61.5%) chains, 23,521 (38.1%) regional franchises or independently owned pharmacies, and 240 (0.4%) government pharmacies. In large metropolitan areas, 62.8% of the pharmacies were chains; however, in rural areas, 76.5% of pharmacies were franchises or independent pharmacies. Across the overall U.S. population, 48.1% lived within 1 mile of any pharmacy, 73.1% within 2 miles, 88.9% within 5 miles, and 96.5% within 10 miles. Across the United States, 8.3% of counties had at least 50% of residents with a distance greater than 10 miles. These low-access counties were concentrated in Alaska, South Dakota, North Dakota, and Montana. CONCLUSIONS: Community pharmacies may serve as accessible locations for patient-centered, medication management services that enhance the health and wellness of communities. Although chain pharmacies represent the majority of pharmacy locations across the country, access to community pharmacies in rural areas predominantly relies on regional franchises and independently owned pharmacies.

Reduction in Medicaid Rebates Paid by Pharmaceutical Manufacturers for Outpatient Infused, Injected, Implanted, Inhaled, or Instilled Drugs: The 5i Loophole.

CONTEXT: When nonretail pharmacy sales exceed 70% of sales, manufacturers of infused, injected, implanted, inhaled, or instilled (5i) drugs are required to calculate average manufacturer price (AMP) under a different methodology than that used for drugs predominantly distributed through retail channels. Specifically, the modified methodology includes pharmacy benefit manager (PBM) rebates in the calculation of AMP for 5i drugs. The modified methodology reduces manufacturers' Medicaid rebate liability and increases net costs to the Medicaid program. METHODS: The authors identified 15 5i drugs predominantly dispensed through the nonretail setting. Using 2013-2017 data from Medicaid, Medicare, SSR Health, and 340B program eligibility, they estimated differences in AMP, Medicaid rebates, and net Medicaid costs under both the standard and 5i AMP methodologies. FINDINGS: AMP was 42% lower, on average, under the 5i methodology than under the standard methodology. From 2013-2017, Medicaid rebates under the 5i methodology were 82% lower than under the standard methodology, resulting in manufacturers of these 15 drugs reducing their Medicaid rebate liability by $1.1 billion in five years. CONCLUSIONS: Inclusion of PBM rebates in the calculation of AMP for 5i drugs significantly reduced Medicaid rebates, resulting in higher Medicaid spending. This may incentivize manufacturers to shift sales to nonretail channels. To remove this incentive, policy makers should consider excluding PBM rebates from the calculation of AMP for 5i drugs.

Disparities in distribution of COVID-19 vaccines across US counties: A geographic information system-based cross-sectional study.

BACKGROUND: The US Centers for Disease Control and Prevention has repeatedly called for Coronavirus Disease 2019 (COVID-19) vaccine equity. The objective our study was to measure equity in the early distribution of COVID-19 vaccines to healthcare facilities across the US. Specifically, we tested whether the likelihood of a healthcare facility administering COVID-19 vaccines in May 2021 differed by county-level racial composition and degree of urbanicity. METHODS AND FINDINGS: The outcome was whether an eligible vaccination facility actually administered COVID-19 vaccines as of May 2021, and was defined by spatially matching locations of eligible and actual COVID-19 vaccine administration locations. The outcome was regressed against county-level measures for racial/ethnic composition, urbanicity, income, social vulnerability index, COVID-19 mortality, 2020 election results, and availability of nontraditional vaccination locations using generalized estimating equations. Across the US, 61.4% of eligible healthcare facilities and 76.0% of eligible pharmacies provided COVID-19 vaccinations as of May 2021. Facilities in counties with >42.2% non-Hispanic Black population (i.e., > 95th county percentile of Black race composition) were less likely to serve as COVID-19 vaccine administration locations compared to facilities in counties with <12.5% non-Hispanic Black population (i.e., lower than US average), with OR 0.83; 95% CI, 0.70 to 0.98, p = 0.030. Location of a facility in a rural county (OR 0.82; 95% CI, 0.75 to 0.90, p < 0.001, versus metropolitan county) or in a county in the top quintile of COVID-19 mortality (OR 0.83; 95% CI, 0.75 to 0.93, p = 0.001, versus bottom 4 quintiles) was associated with decreased odds of serving as a COVID-19 vaccine administration location. There was a significant interaction of urbanicity and racial/ethnic composition: In metropolitan counties, facilities in counties with >42.2% non-Hispanic Black population (i.e., >95th county percentile of Black race composition) had 32% (95% CI 14% to 47%, p = 0.001) lower odds of serving as COVID administration facility compared to facilities in counties with below US average Black population. This association between Black composition and odds of a facility serving as vaccine administration facility was not observed in rural or suburban counties. In rural counties, facilities in counties with above US average Hispanic population had 26% (95% CI 11% to 38%, p = 0.002) lower odds of serving as vaccine administration facility compared to facilities in counties with below US average Hispanic population. This association between Hispanic ethnicity and odds of a facility serving as vaccine administration facility was not observed in metropolitan or suburban counties. Our analyses did not include nontraditional vaccination sites and are based on data as of May 2021, thus they represent the early distribution of COVID-19 vaccines. Our results based on this cross-sectional analysis may not be generalizable to later phases of the COVID-19 vaccine distribution process. CONCLUSIONS: Healthcare facilities in counties with higher Black composition, in rural areas, and in hardest-hit communities were less likely to serve as COVID-19 vaccine administration locations in May 2021. The lower uptake of COVID-19 vaccinations among minority populations and rural areas has been attributed to vaccine hesitancy; however, decreased access to vaccination sites may be an additional overlooked barrier.

Income disparities in driving distance to health care infrastructure in the United States: a geographic information systems analysis.

OBJECTIVE: Inequities in access to health care contribute to persisting disparities in health care outcomes. We constructed a geographic information systems analysis to test the association between income and access to the existing health care infrastructure in a nationally representative sample of US residents. Using income and household size data, we calculated the odds ratio of having a distance > 10 miles in nonmetropolitan counties or > 1 mile in metropolitan counties to the closest facility for low-income residents (i.e., < 200% Federal Poverty Level), compared to non-low-income residents. RESULTS: We identified that in 954 counties (207 metropolitan counties and 747 nonmetropolitan counties) representing over 14% of the US population, low-income residents have poorer access to health care facilities. Our analyses demonstrate the high prevalence of structural disparities in health care access across the entire US, which contribute to the perpetuation of disparities in health care outcomes.

Association of Generic Competition With Price Decreases in Physician-Administered Drugs and Estimated Price Decreases for Biosimilar Competition.

Importance: Price decreases of biologic and biosimilar products in Medicare Part B have been minimal, even with biosimilar competition. Medicare reimburses clinicians for biologics and biosimilars differently than for brand-name and generic drugs, which has generated greater price reductions. Objective: To characterize the nature of price competition among brand-name and generic drugs under Medicare Part B and to estimate the cost savings to the program of subjecting biologic and biosimilar therapies to a similar price competition. Design, Setting, and Participants: This cohort study analyzed all brand-name drugs and their approved generic versions as well as biologics and biosimilars that were reimbursed under Medicare Part B from quarter 1 of 2005 to quarter 2 of 2021. Two separate data sets were created: brand-name and generic drugs as well as biologics and biosimilars data sets. Brand-name products with generic versions that were introduced before 2005 were excluded, and so were vaccines. Exposures: Number of generic and biosimilar competitors over time. Main Outcomes and Measures: Price change as a percentage of the brand-name drug or biologic price in the quarter before generic or biosimilar competition. Price change was modeled using a linear, fixed-effects time series regression, with the number of generic or biosimilar competitors as the main covariate. Time was expressed as the number of quarters since the first generic or biosimilar competitor entered the market. Savings were estimated by projecting the regression model of brand-name and generic drug competition to observed biologic and biosimilar competition and by applying the estimated price reduction to actual Medicare spending for those products from 2015 to 2019. Results: Of the 988 Healthcare Common Procedure Coding System codes identified, 50 (5.0%) met the inclusion criteria for the brand-name and generic drug data set and 28 (2.8%) met the criteria for the biologic and biosimilar data set. The first generic competitor was associated with reduced drug prices by 17.0%, the second competitor with a 39.5% decrease, the third competitor with a 52.5% decrease, and the fourth and more competitors with a 70.2% decrease (price decline was measured from brand-name drug price before the first generic competitor rather than from price established with fewer competitors). If biologics and biosimilars were subject to the same Medicare reimbursement framework as brand-name and generic drugs, Medicare spending on these products was estimated to have been 26.6% lower ($1.6 billion) from 2015 to 2019. Conclusions and Relevance: This study found minimal uptake of biosimilars and limited price reductions for biologics and biosimilars under the current Medicare Part B reimbursement policy. Adopting the bundled biosimilar reimbursement structure for biologic and biosimilar therapies may be associated with substantial savings and encourage greater biosimilar market entry.

Association Between the Percentage of US Drug Sales Subject to Inflation Penalties and the Extent of Drug Price Increases.

Importance: Policy makers have proposed levying penalties for drug price increases that are higher than the rate of inflation for drugs covered in the US Medicare program, but research is lacking regarding the ways in which manufacturers might respond to those penalties. An understanding of manufacturers' responses to existing inflation penalties could inform such policy discussions. Objective: To estimate the association of existing inflation penalties in the US 340B Drug Pricing Program with manufacturer pricing behavior in the Medicare Part D program and associated changes in Medicare pharmacy expenditures. Design, Setting, and Participants: This study included a pooled cross-sectional time-series analysis of price changes for Medicare Part D drugs used annually by more than 5000 beneficiaries between January 1, 2013, and December 31, 2017. The percentage of Medicare Part D sales subject to inflation penalties in the 340B program was used to perform a regression analysis to estimate the association of inflation penalties with annual drug price changes. The 340B program requires manufacturers to sell their drugs at a lower price to safety-net health care organizations; this lower price includes a base discount and an additional discount equal to the amount of any price increase that is higher than the rate of inflation. Sales to these 340B-eligible health care organizations represent the market share of a drug subject to inflation penalties. Health care organization-level claims data were obtained from the Medicare Provider Utilization and Payment Data-Part D Prescriber database, and organizations were matched to the Office of Pharmacy Affairs Information System of the Health Resources and Services Administration to identify those organizations that were eligible for the 340B program. Price change and drug use data were obtained from the Medicare Part D Drug Spending Dashboard. Name-brand drugs were included in the analysis if they did not have generic competition and were used by more than 5000 individuals with Medicare Part D in 1 calendar year. Data analysis was conducted from January 1 to February 28, 2020. Main Outcomes and Measure: Annual price change was the primary outcome measure; spending changes associated with lower price increases were also estimated. Sales percentage subject to inflation penalties was the primary independent variable, and formulary classification was a control variable. Results: Of 2148 brand-name drugs included in the database, 606 drugs were used by more than 5000 beneficiaries annually, with a mean sales percentage subject to inflation penalties of 12.1%. A higher sales percentage subject to inflation penalties was associated with lower annual price increases (between-effects coefficient, -0.114; 95% CI, -0.205 to -0.023; P = .01; fixed-effects coefficient, -0.380; 95% CI, -0.466 to -0.294; P < .001). Lower price increases owing to inflation penalties were estimated to be associated with a reduction in Medicare Part D pharmacy expenditures of $7.1 billion between 2013 and 2017. Conclusions and Relevance: In this cross-sectional study, increases in the percentage of drug sales subject to inflation penalties were associated with lower annual price increases. Broader application of inflation penalties may help to reduce drug price increases and decrease overall drug spending.