Biotech
Wednesday, September 25th, 2024 6:12 pm EDT
Key Points
- Wegovy’s Potential Inclusion in Price Negotiations: Wegovy, a weight loss drug by Novo Nordisk, is expected to be included in the upcoming second round of price negotiations for Medicare Part D drugs. The Biden administration will announce the next 15 costliest drugs for negotiation by February, aiming for price changes to be implemented by 2027. As all Novo Nordisk drugs containing the active ingredient semaglutide will likely be grouped together, it could impact the costs for older adults reliant on these medications, which are currently priced around $1,000 per month.
- Concerns Over Drug Pricing and Medicare Spending: The high list prices of semaglutide medications have drawn criticism from lawmakers and patient advocates. While Novo Nordisk’s CEO, Lars Fruergaard Jørgensen, did not commit to lowering prices during a Senate hearing, he expressed a willingness to work with pharmacy benefit managers to improve access and affordability. The Medicare Part D program reportedly spent over $5.6 billion on semaglutide drugs in 2022, and projected spending for 2023 is nearly $7.5 billion, highlighting the financial burden of these medications on the Medicare system.
- Antitrust Lawsuit Filed by Particle Health Against Epic Systems: In a separate development, Particle Health has filed an antitrust lawsuit against Epic Systems, alleging that Epic is using its market dominance in electronic health records to stifle competition. The lawsuit follows previous disputes between the two companies over data-sharing practices within the Carequality interoperability network. Epic has denied the allegations, asserting that Particle’s claims are baseless and that it will vigorously defend itself against the lawsuit. The resolution of this antitrust case may take considerable time, reflecting the complexity of such legal matters in the healthcare sector.
A recent article in CNBC’s Healthy Returns newsletter highlights that Wegovy, Novo Nordisk’s popular weight loss drug, is a top contender for the second round of price negotiations between drug manufacturers and Medicare. The upcoming negotiations, set to unveil the next 15 costliest Medicare Part D drugs by February, aim to reduce prices for medications, with changes expected to take effect in 2027. The Biden administration previously announced negotiated prices for the first ten drugs, which will go into effect in 2026. The Centers for Medicare & Medicaid Services has indicated that drugs with the same active ingredient produced by the same manufacturer will be treated as a single product during negotiations. Consequently, it is anticipated that all of Novo Nordisk’s semaglutide-based drugs—Wegovy, the diabetes medication Ozempic, and the oral drug Rybelsus—will be selected collectively for these talks.
The high costs of these medications, each priced at approximately $1,000 monthly before insurance, raise concerns for older adults relying on them. While it remains uncertain how much Medicare can negotiate these prices down, patient advocates and lawmakers have criticized Novo Nordisk for its pricing strategies, particularly regarding its obesity and diabetes treatments. During a recent Senate hearing, Novo Nordisk’s CEO, Lars Fruergaard Jørgensen, faced scrutiny over the company’s pricing practices but refrained from committing to any reductions, expressing a willingness to collaborate with pharmacy benefit managers to enhance patient access and affordability.
Wegovy, which is now approved to reduce major cardiovascular complications, may be covered by some Medicare Part D plans, creating grounds for its inclusion in the negotiation process. The law stipulates that a drug must be on the market for at least seven years without generic competitors to qualify for Medicare negotiations. Semaglutide, which has been on the market for over seven years, meets this criterion. Additionally, research indicates that Medicare Part D spent more than $5.6 billion on semaglutide drugs in 2022 and projects an increase to $7.5 billion in 2023, underscoring the financial impact of these medications on the Medicare program.
Alongside Wegovy, other drugs anticipated for negotiation include GSK’s Trelegy Ellipta for asthma and COPD, and Astellas Pharma’s Xtandi for rheumatoid arthritis. However, the final list of drugs selected for negotiations will depend on the introduction of generic alternatives before February. The article emphasizes the importance of closely monitoring the developments in Medicare drug price negotiations.
In a related segment, the newsletter also reports on Particle Health filing an antitrust lawsuit against Epic Systems, a major electronic health records provider, claiming that Epic is using its dominance to stifle competition. The lawsuit reflects ongoing tensions in the healthcare data-sharing landscape, with both companies previously clashing over data-sharing practices. Epic has denied the allegations and maintains that Particle’s claims are baseless. The outcome of this lawsuit, like many antitrust cases, may take considerable time to resolve.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/09/24/healthy-returns-wegovy-could-face-medicare-drug-price-negotiations-next.html
