The Virtues Of Predictability: US Medicare’s Review Of Aduhelm Coverage
Medicare’s decision to initiate a formal review of coverage for the newly approved Alzheimer’s agent is a highly unsettling development in many respects. It is also probably the best possible news for Biogen and Eisai at this point.
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Biogen’s Alzheimer’s drug may not cause as much of a financial headache to American seniors as expected, which could dampen criticism of Medicare’s upcoming coverage determination. But questions remain about what exactly HHS will be able to do about Part B premiums.
Biogen is making clear that its decision to cut the price of the Alzheimer’s therapy Aduhelm is in no way tied to the upcoming US Medicare coverage decision for the treatment. But it still shows how Medicare can already ‘negotiate’ prices even without explicit statutory authority.
CMS is famous for not being able to negotiate prices – and its payment for physician-administered drugs notoriously incentivizes higher prices. Yet, as the Biogen/Eisai Aduhelm experience shows, CMS can on occasion have a profound impact on product launches when it chooses to.