Inflection Point
Inflection Point is usually for big, driving-the-day kind of news. So a story about the fact that the net price of obesity medicines being a ton lower than the list price wouldn’t normally be a top-of-the-newsletter kind of story.
But when the New York Times covers something, the rules go out the window. Gina Kolata’s piece on the real price of obesity medicines is worth spotlighting for three reasons, in addition to the obvious point that we should probably pay attention when the NYT pays attention.
One, it elevates the very helpful AEI numbers on the net price and post-coupon price of drugs used for obesity, which creates the closest thing we have to a shared reality when it comes to prices.
Two, it’s exhaustive. Pretty much every academic who should be talking about gross-to-net bubbles is quoted.
Three, it includes a very interesting admission from ICER: Wegovy, at these net prices, is cost-effective by ICER’s methodology. That just reinforces my deeply held belief that these medicines are a great deal. (And reinforces my deeply held belief the conflict between cost-effectiveness and system affordability will be the defining industry issue for the next few years.)
The Arc
I can’t believe I missed this last week, but Cencora has a really amazing survey of payers that lays out exactly what the change in the Medicare Part D benefit design under the Inflation Reduction Act is going to do. (Fierce has a good story on the data, too.)
First off, it’s going to raise premiums. About half of the payers surveyed said premiums will be up more than 5%. So beneficiaries will be paying more. Will they be getting more?
Nope: it’s a hard no on that. About 50% said that formularies will become “somewhat” more narrow. Another 24% said that formularies will become “significantly” more restrictive. Forty-two percent of those surveyed are preparing for “greater utilization across the board.”
In other words, without some intervention, the IRA is at risk of making the lives of patients a lot worse via a set of rules that will incentivize health plans to move in altogether the wrong direction.
Expect to hear a lot more about this as we move into the patient-feedback part of the CMS price-setting process.
Quick Turns
On an ordinary day, this would have appeared higher, but don’t be confused by the below-the-fold mention of this JAMA Health Forum piece. It’s really a must-read. The upshot is that the authors — a bunch of names you’ve heard of, led by a Johns Hopkins team — looked at 45 generic drugs and found that middlemen ended up with 70% of the revenue from each prescription.
PBMs grabbed most of that revenue — even more than the actual manufacturers — with pharmacies and wholesales grabbing dollars, too. The Marketwatch story on the research wondered aloud if this is an area of the health system where we should just jettison insurance coverage altogether. That would be hugely disruptive to big parts of the supply chain, but it’s looking more and more like it would be a boon to consumers.
Elsewhere:
- The WSJ has a great piece on how, when all is said and done, health insurance companies are likely to end up winners if obesity-med prescribing explodes. Because PBMs, natch.
- While we’re talking obesity, here’s a story about a health system in Minnesota that is dropping obesity-med coverage for cost reasons.
- My first reaction to the GoodRx/Sanofi tie-up designed to bring $35 insulin to GoodRx card holders was one of cynicism. I mean, Sanofi has worked pretty hard to make $35 Lantus a thing via a ton of other channels. Was a partnership with GoodRx really so novel that it deserved a pantload of coverage (Bloomberg, Reuters, CNBC, etc.)? But here’s the thing: anything pharma can do to remind people that patient assistance exists and is easy to use is probably a net benefit.
- The Harvard-PORTAL guys have an op-ed in the Washington Post that says that pharma’s legal attack against the IRA is meritless. There’s nothing really original there, and the piece doesn’t remotely address some of the process-driven arguments that undergird the Novo Nordisk and AstraZeneca suits, so I’m not sure it’s worth the read. But — hey — it’s the WaPo, so you should probably pay some attention.
