(AP) — A new $56,000-per-year Alzheimer's drug would significantly raise Medicare
premiums, and some patients prescribed the medication could face annual copayments of around $11,500, according to a research
report released Thursday.
The drug, called Aduhelm
, was approved by the Food
and Drug Administration this week, sparking outrage over its high price and dubious benefits. In a letter he submitted when resigning over the decision on Thursday, an FDA adviser called the decision “probably the worst drug approval decision in recent US history
According to a new nonpartisan Kaiser Family Foundation analysis, prescribing Aduhelm to just 500,000 Medicare recipients would cost the program nearly $29 billion per year, costing far more than any other medication.
“At this price, the cost of this one drug alone could exceed the cost of all others covered by Medicare if it is widely used,” said Tricia Neuman, report coauthor.
Separately, Dr. Aaron Kesselheim of Harvard University
became the third member of an FDA advisory panel that opposed the drug to resign over the decision. The 11-member panel voted nearly unanimously against recommending approval for the medication last November, citing flaws in company studies. The FDA is not required to follow such recommendations.
Kesselheim stated in his resignation letter, obtained by The Associated Press
, that the FDA's recent drug approval decisions would undermine public trust, medical innovation
, and the "affordability of the health care
system." Earlier this week, two expert neurologists also resigned from the panel.
Aduhelm is the first Alzheimer's medication in nearly 20 years. It does not cure the life-threatening neurological condition, but the FDA determined that its ability to reduce clumps of plaque in the brain
is likely to slow dementia, though many experts disagree.
The drug's approval comes as Democrats
in Congress work
to reach an agreement on legislation that would allow Medicare to negotiate prescription drug prices.
Finance Committee chairman, Democratic
Sen. Ron Wyden of Oregon
, said Thursday that the list price for Aduhelm was “unconscionable.” Although President Joe Biden
has called for granting Medicare negotiating authority, the bill’s prospects are uncertain.
Medicare has not made a formal decision on whether or not to cover the Alzheimer's drug, but cost is typically not a factor in such decisions. Drugmaker Biogen
has stated that Aduhelm is priced responsibly.
Alzheimer's disease affects approximately 6 million Americans, the vast majority of whom are Medicare beneficiaries.
In addition to increased taxpayer costs, the Kaiser analysis discovered that domino effects would include higher “Part B” premiums for Medicare’s outpatient coverage and increases in monthly premiums for millions of people
with supplemental “Medigap” plans. Aduhelm is covered by Medicare’s outpatient care benefit as an infusion drug administered in a doctor’s office.
Beyond monthly premiums, there would be an impact on out-of-pocket costs. Many patients taking the medication, including those enrolled in Medicare Advantage plans from private insurers, could face thousands of dollars in copayments, with the maximum reaching around $11,500, according to researchers, well above the average Medicare enrollee's budget.
“Because Aduhelm is not a cure for Alzheimer's disease, patients may incur these annual out-of-pocket costs over multiple years,” according to the report.
Biogen, which co-developed the Alzheimer's drug with Japan
's Eisai Co., stated earlier this week that it anticipates a gradual increase rather than a sharp "hockey-stick" spike.
According to Chirfi Guindo, Biogen's head of global product, the drug's price was determined after extensive research, and the company has committed to no price increases for the next four years.
Guindo stated that the company researched prices for advanced medications used to treat cancer
and other complex conditions. “We have priced Aduhelm at roughly a third the level of the cancer immunotherapies,” he said during a teleconference this week. “So, we consider this to be a really responsible price and a price that is sustainable for the system.”
Medicare has a review process known as a National Coverage Determination to evaluate new treatments that may have far-reaching implications for the program. Officials have not yet stated how the program will proceed with Aduhelm, but it is possible Medicare will set conditions for covering the drug based on clinical effectiveness.
Medicare covers over 60 million people, including those 65 and older, as well as those who are disabled or have severe kidney disease, and annual spending on the program approaches $1 trillion.
The Kaiser Family Foundation report was released on Thursday, not Wednesday, as previously stated in this article.