Arnold Foundation Funded Austin Frakt Falls Flat Flakking for ICER

  • by: Robert Goldberg |
  • 05/16/2018
In the wake of the President’s speech on drug pricing organizations and individuals funded by the Laura and John Arnold Foundation have been campaigning to establish the Institute for Clinical and Economic Review – another Arnold funded enterprise –  as the ultimate and undisputed authority for determining the price and value of new medicines.  

An article written by Austin Frakt, a blogger, and director of  the Partnered Evidence-Based Policy Resource Center at the V.A. Boston Healthcare System tries to make just that case. 

Frakt, the latest expert put on the Arnold foundation payroll wrote that ICER is the light and salvation to the drug pricing issue: 

“It is hard to generate enough reliable cost-effectiveness information to give insurers the leverage to say “no” to unreasonably expensive drugs….

The nonprofit and privately financed Institute for Clinical and Economic Review  has proposed a way to solve that problem. Largely funded by the Laura and John Arnold Foundation, it is an independent organization that weighs the benefits of medical technologies against their prices.

For each new drug that comes to market, the organization conducts a clinical and economic analysis that’s available to the public. It then suggests to payers and manufacturers a price range that’s aligned with benefits and budgets.

There’s evidence that the exercise is helping insurers cut better deals. For example, Dupixent, the first cure for eczema, was expected to launch last year at a price of $60,000 per year of treatment. At a cost this high, many insurers would have imposed onerous cost-sharing requirements on patients before covering it.

Instead, Dupixent manufacturers Regeneron Pharmaceuticals Inc. and Sanofi sought a value-based price from ICER before setting the list price for the drug. Then, during negotiations with payers, the companies argued that the outside assessment established a fair price that warranted lower cost sharing and fewer barriers for patient access.

A similar story arose with Praluent, for high cholesterol. Regeneron and Sanofi struck a deal with the pharmacy benefits manager Express Scripts to reduce Praluent’s price to one that ICER believed aligned better with benefits. In exchange, patients will get easier access to the drug.”

Frakt ignores how ICER’s suggestions on pricing and limiting access to save money were used to deny and limit access to hepatitis C drugs, recommendations that drove cure rates down from 99 percent to 75 percent in some health plans.   It claimed that new medicines for multiple myeloma were not valuable at ANY price.  On top of all that, ICER claims that spending more than about $1 billion a year on one drug would threaten the financial stability of a health plan.  Which means that even if we had a cure for HCV or Alzheimer’s we would have to limit access once that $1 billion mark was hit. 

Frakt is either misleading or uninformed about access to Dupixent.  The Dupixent ‘deal’ was made with Express Scripts.  The claim that patients have faster access to the drug is bogus: Express Scripts requires Medicare patients to fail first on two other drugs in order to get Dupixent.  

“Patient meets both of the following criteria: a. Patient has used at least one medium-, medium-high, high-, and/or super-high-potency prescription topical corticosteroid for at least 28 consecutive days OR patient has atopic dermatitis affecting ONLY the face, eyes/eyelids, skin folds, and/or genitalia and has tried tacrolimus ointment for at least 28 consecutive days AND b. Inadequate efficacy was demonstrated with these previously tried topical prescription therapies, according to the prescribing physician. “

He also claims that ICER research would make more medicines widely available because health plans don’t do any cost-effectiveness analysis of their own to make such patient-focused decisions. Yet as search of Dupixent on Formulary Lookup reveals that only 5 percent of commercial health plans given the drug preferred access.  None allow immediate access.  Instead, patients have to fail first on 2-3 other drugs.  Nearly 70 percent of Medicare Part D PBMs don't even cover the drug. 

Frakt also fall flat in describing the health bounty flowing from ICER’s evaluation of new anti-cholesterol medicines called PCSK9s (one called Repatha, made by Amgen and another called Praluent, made by Regeneron) that are much more effective than statins alone in reducing cholesterol levels and the heart disease caused by the condition.

The list price for the drugs was – is - $14000.  ICER said it was only worth about $5000 and that to make it available to every patient who could benefit, the price should be $2000.  

These recommendations were used by PBMs for force deeper rebates in exchange for excluding competitor drugs from their formulary as well as reduce the PBM and health plan spending on new drugs. In the case of Repatha and Praluent, such practices have cut the market for Repatha and Praluent by two thirds.   

As Frakt noted, Express Scripts recently cut a deal with Regeneron to eliminate step therapy and prior authorization for  Praluent in exchange for more rebates.  ICER produced a new assessment that Express Scripts claimed led to this deal.  In fact, ICER essentially restated the findings in its first report: that a small subgroup of patients should get the drug if drug companies cut the price to about $5000.  

This value-based pricing process increased rebates and led to a lower net price. But it did NOT result in eliminating cost sharing.  Patients – the handful that will get the drug – will still pay $100 a month for the drug.  Second, Express Scripts is limiting access to its infusion centers, meaning more profit.  Third, as part of the deal, Express Scripts no longer covers Repatha, Amgen’s PCSK9.  Patients will have to pay full price or reapply to get Repatha. 

The fact is, net prices alone will not guarantee affordable access.  PBMs will still use step therapy, prior authorization, and cost sharing to maximize rebates and keep drug costs using ICER prices as a bargaining chip.

The president has made it clear that drug companies will have to find another way to get new and expensive medicines to patients.   But those prices must be based, not on the secret and ideologically driven deliberations of a group like ICER or the kind of backroom deals that lead to the Repatha ripoff.  

The job of deciding the value of any medicine will have to be democratized.  If drug and device companies don’t take the money they now spend on rebates, patient assistance programs, and copay cards and invest in demonstrating the differential value of their products to doctors, health plans and most importantly, patients, groups like ICER will gain more control over access.   Which means, contrary to Frakt’s flakking for ICER, most patients will have less access to new medicines and pay more for them.  

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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