New Insurance Marketplaces Won’t ‘Move The Needle’ Near-Term For Pharma Economics – An Interview With Booz & Co.
Jan. 1, 2014, the date insurance coverage expansion begins, is a key marker in the implementation of the Affordable Care Act, but experts, including Booz & Co. partners Elizabeth Powers and Greg Rotz say it isn’t likely to have a big near-term impact on drug manufacturers. Initial enrollment into health insurance exchanges and expanded Medicaid programs is expected to be limited, benefit plan designs are still unknown, and many uncertainties remain.
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Three years into the ACA, the biopharma industry takes stock of its near-term wins and losses as the law’s critical expanded insurance coverage takes effect beginning in 2014. Pharma still isn’t sure whether the increase in covered lives from the exchanges will boost prescription sales enough to offset the rebates, taxes, and fees it agreed to pay out, or what kind of patients constitute this new market.
In a slow week for pharma deals, standouts included GSK’s wrap up with MorphoSys for a mid-stage rheumatoid arthritis drug, Pfizer’s deal to gain access to novel kinds of antibody drug-conjugates through platform company CytomX, and the first microbiome deal between a big pharma (Janssen) and a start-up, Second Genome.
Health care exchanges for expanding insurance coverage as part of the Affordable Care Act will open in time to meet the law’s January 1 deadline, but their “robustness” and ease of use, at least initially, may be questionable, a panel of experts tells Wall Street.