Lead Balloon

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  • 10/18/2006
CMS Floats Trial Balloon for Part D Data Sharing Initiative

Drug Industry Daily
By: Stephen Langel

The Centers for Medicare & Medicaid Services (CMS) is using a proposed rule issued today to test the legal waters for its plan to collect and share prescription drug plan data to base Medicare reimbursements on product comparisons, sources say.

The proposed rule would require any entities offering prescription drug coverage under the Medicare Rx law to provide the CMS with data about the products they offer, including drugs, biologics and medical devices, as part of their contracts with the government. "Through the appropriate use of the new prescription drug claims data, we have an unprecedented resource to help us learn more about prescription drug usage by seniors and how we can help seniors get the most benefit from prescription drugs," former CMS Administrator Mark McClellan said.

The CMS would then use the data, which includes various measures of the products' cost, to improve the workings of the Medicare program, according to the rule. The agency would also share this data with the FDA to "provide protection against adverse drug events" and with HHS' Agency for Healthcare Research and Quality's (AHRQ) to do comparative drug studies.

This development comes weeks after the initiative seemed dead because of questions regarding CMS' statutory authority (DID, Oct. 2). The agency is using the proposed rule to make legal arguments supporting the policy. "We are engaging in this rulemaking in order to resolve the statutory ambiguity," the rule said.

The agency believes that it has "broad authority" under the Medicare Rx law to share such data. Section 1860D-12(b)(3)(D) of the law provides the HHS secretary with the authority to "collect a broad array of data in order to properly carry out his responsibilities," the rule said. But the section also limits use of the data to work necessary to carry out the act.

However, the agency believes the law gives it some leeway, saying that if the secretary believes it is necessary and appropriate to carry out responsibilities even outside the scope of the section, he has the authority to do so.

The proposed rule prompted a strong response by both supporters and opponents of comparative trials. Peter Pitts, director of the Center for Medicine in the Public Interest and a former FDA associate commissioner for external relations, told DID the rule is the foundation for cost-based medical coverage that shortchanges the public and "sets an extremely dangerous precedent." The CMS is "trying to take authority away from the doctors and give it to the accountants."

While McClellan had proposed comparative trials as a way to ensure the best medicines were covered, without him leading the agency this decision will devolve into a purely cost-based decision, Pitts added. "Once he's out the door, there's no guarantee" that this program will be run correctly. McClellan left the CMS last week for the American Enterprise Institute-Brookings Joint Center for Regulatory Studies.

PhRMA is cautiously optimistic about the rule. Comparative data "can offer a valuable source of information," a spokesman said. But research based on that data has a number of limitations, he added.

However, public interest groups such as Consumers Union have long supported this strategy and lauded the rule. "The CMS initiative is very exciting, and holds out the promise for major advances in understanding what works and doesn't work in the world of pharmaceuticals, and where short-term adverse reactions and long-term dangers may be lurking," Bill Vaughan, the group's senior health analyst, told DID.

The key to the program's success is not the rule itself, but the FDA obtaining sufficient funding to use the data, he added. The agency needs money from the Prescription Drug User Fee Act to "mine the CMS data for the gold nuggets of knowledge that it can offer. With adequate support, the FDA can use the CMS database to make the adverse event reporting system and
other postmarket approval monitoring work the way that consumers hope and expect."

Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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