Hernandez, Inmaculada, Cousin, Emma M., Wouters, Olivier J. 
ORCID: 0000-0002-2514-476X, Gabriel, Nico, Cameron, Teresa and Sullivan, Sean D.
(2024)
Price benchmarks of drugs selected for medicare price negotiation and their therapeutic alternatives.
Journal of Managed Care & Specialty Pharmacy.
ISSN 2376-1032
(In Press)
Abstract
Background The Centers for Medicare and Medicaid Services (CMS) is currently negotiating prices with pharmaceutical manufacturers for the first ten Part D drugs selected for Medicare drug price negotiation. Non publicly available data, including net prices of selected drugs and their therapeutic alternatives, will play a central role in the determination of the maximum fair prices (MFPs). Objective To estimate price benchmarks involved in the derivation of the starting point of CMS initial price offer for the ten drugs selected for Medicare price negotiation. Methods For the ten drugs selected for negotiation, we reported (1) the list price, (2) the net price after manufacturer discounts, (3) the maximum negotiated price based on the minimum statutory discount, and (4) the ceiling of the MFP, estimated as the lowest of the latter two. We also estimated net prices for therapeutic alternatives to the selected drugs. Net prices were estimated using peer-reviewed methodology that isolates commercial discounts negotiated between payers and manufacturers from mandatory discounts under government programs. All price benchmarks were estimated at the product level, for 30-day equivalent dosing, using 2021 data. Results Six products (apixaban, rivaroxaban, empagliflozin, sacubitril/valsartan, etanercept, and insulin aspart) had therapeutic alternatives with lower net prices, which will be integrated with clinical benefit data in the derivation of initial price offers. The other four products (ustekinumab, ibrutinib, sitagliptin, and dapagliflozin) had therapeutic alternatives with higher net prices than the drugs selected for negotiation. For ibrutinib and ustekinumab, prices based on minimum discounts were considerably lower than the estimated net prices and will likely set the starting point of the initial price offer. For dapagliflozin and sitagliptin, the starting point of the initial price offer will likely resemble their existing net prices. Conclusions Our analyses identify different negotiation scenarios for the first ten drugs selected for Medicare price negotiation, based on key elements involved in the derivation of the initial price offer. Our analyses can help improve transparency in the negotiation process, as CMS is not required to reveal information used in the derivation of price offers.
| Item Type: | Article |
|---|---|
| Additional Information: | © 2024 |
| Divisions: | Health Policy |
| Subjects: | R Medicine > RA Public aspects of medicine > RA0421 Public health. Hygiene. Preventive Medicine R Medicine > RM Therapeutics. Pharmacology |
| Date Deposited: | 05 Jun 2024 16:12 |
| Last Modified: | 07 Jul 2024 00:06 |
| URI: | http://eprints.lse.ac.uk/id/eprint/123795 |
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