Washington. Healthcare. Translated.

High-Impact Drugs: Is “Impact” on patients or payers?

I caught a report from OptumRx of “Five Drugs Set to Have the Biggest Impact on Payers and Patients.” It’s a glimpse into late-stage pipeline products likely to be high-impact launches. You can find it here: https://www.fiercehealthcare.com/payer/optum-5-drugs-set-to-have-biggest-impact-payers-and-patients

 

It’s always worth looking at the pipeline of pharmaceuticals in development. It’s probably even more worthwhile looking at its likely impact.

 

Usually, an analysis of the pipeline will focus on clinical benefits – “wow, a treatment for untreatable Muscular Dystrophy.” Sometimes, the report focuses on a blockbuster’s impact to the drugmaker’s stock – “wow, sure to pass $1B in sales within a year.” It’s rare, though, to focus on the impact on insurers and the patient’s pocketbook. “Wow, $650K per year, for life. Who’ll cover a 20% copay for THAT?”

 

Why are patient economics so rarely in the spotlight? Why would it take a White House Shamefest to point out what patients face to pay for the drugs they need, especially for recent orphan drugs.

 

I’ve got a couple of simple but non-comforting theories. First, there’s often very little known about launch pricing until after a drug is launched. Setting the list price, the Medicare price, the 340B price (ask me), and the MCO price is not for the timid. Pricing typically isn’t announced until close to launch. You can’t talk pricing if you don’t know pricing. This leaves very little time for analysis of patient impact until drugs graduate from the pipeline to the marketplace.

 

Second, it’s become politically incorrect to call for limits on drug use or access. Our world now allows for no shaming on anyone except maybe shamers. Denying a drug can’t be done across the board, so singling out special populations isn’t workable, either. Saying “yes” to a leukemia patient but “no” to a muscular dystrophy patient is rude, discriminatory, wrong. Taking it to the next level that giving a Hep C vaccine to ten prisoners could cover childhood vaccines for thousands of children… an unacceptable equation to write. So we’re left with pressure toward covering it all.

 

Don’t forget a couple of factors specific to the health policy world. Before Obamacare, a million-dollar lifetime cap on insurance payments was common, and million-dollar drugs were unthinkable. Today, the sky’s typically the limit on drug coverage and the $2M gene therapy has arrived. Apply a little “Supply & Demand 101” (infinite demand, monopolistic supplier, third-party payer) and just watch what happens.

 

It’s probably (more than) time for the country to have The Conversation about when too much is simply too much. Meanwhile, someone is looking at the next five battles to run out of the pipeline.

 

Which brings us back to the list. A $2.2 million gene therapy. An opioid less prone to abuse. A rheumatoid arthritis drug. A treatment for muscular dystrophy. And, a $225K/year treatment for a rare cardiac condition. Can you remember when $225K looked like a lot of money?

 

Perhaps we’re not having the national Conversation (with-a-capital-C) about when we’ve reached “too big to pay for” but at least the patient’s point of view is getting onto the radar screen. It’s a massive radar screen, one I keep bumping into over the course of my day but can’t ever get into the spotlight.

 

Pity.