Six Weeks Too Late? Praxbind Gets 2017 Medicare Boost But Not AndexXa

User fee date for Portola's anticoagulant reversal agent is near, but not soon enough for Medicare's new technology payments in 2017 – while Boehringer's Praxbind gets in in time; BTG's Vistogard also gains the extra payments.

Portola Pharmaceuticals Inc. is on the cusp of FDA action on its universal anticoagulant reversal agent AndexXa (andexanet alfa) with a user fee date of Aug. 17. But should it win that approval, it will have to wait until next year to gain bonus Medicare payments as an important new technology for hospital patients.

Both AndexXa and Boehringer Ingelheim GMBH's Praxbind (idarucizumab), a reversal agent specifically for Pradaxa (dabigatran), were under consideration for new technology add-on payments (NTAP) in Medicare's payment scheme for hospital inpatients. (Also see "Medicare Add-On Payments For Praxbind, Andexanet Under Consideration" - Pink Sheet, 21 Apr, 2016.)

The supplemental reimbursement is a temporary extra that supports adoption of medical advances while the Centers for Medicare and Medicaid Services gathers enough data to set an appropriate payment rate. It generally can be provided for up to three years.

In new final rules updating Medicare inpatient payment rates for fiscal year 2017, Praxbind gained the extra payments but CMS notes AdexXa was withdrawn from review. The reason: Medicare rules set an FDA approval cut-off date of July 1 for products to be awarded an NTAP for the coming year (the US government fiscal years start on Oct. 1).

A later approval does not preclude hospitals form purchasing the product for treating Medicare patients. However, payment for hospitalized patients is based on the diagnosis-related groups system, where a flat rate is set for a bundle of treatments and procedures for specific conditions. The flat rates are intended to encourage efficient treatment choices and rates can lag behind adoption of new services because they are updated with hospital cost data. The NTAP policy was created to provide some flexibility to lessen the barrier for significant advances (see box).

Designated as a breakthrough therapy, AdexXa would be the first antidote for Factor Xa inhibitor anticoagulants such as Johnson & Johnson/Bayer AG ’s Xarelto (rivaroxaban), Pfizer Inc./Bristol-Myers Squibb Co.’s Eliquis (apixaban) and Daiichi Sankyo Co. Ltd.’sSavaysa (edoxaban). Its availability as a reversal agent for patients who experience a serious bleeding event or require urgent or emergency surgery could boost the lagging uptake of some of those novel oral anticoagulants. (Also see "Key Clinical Data And Drug Approvals Expected In 2H 2016" - Scrip, 22 Jul, 2016.)

NTAP Criteria

• Product is new, typically defined as FDA approval or market introduction within the past two or three years.
• Existing DRG payment for the service involving the product must be inadequate based on thresholds calculated annually by CMS; and
• Product represents a substantial clinical improvement over existing treatments.

Boehringer can understand Portola's "so close but so far" position: it had sought an NTAP for Praxbind for the 2016 payment year, but similarly missed the approval deadline.

Praxbind was cleared in October 2015 under accelerated approval as the only antidote for Pradaxa, a (dabigatran), a direct thrombin inhibitor.

For 2017, hospitals will receive up to an added $1,750 for patients treated with Praxbind, under the final rules, slated for publication in the Federal Register Aug. 22. That figure is based on BI's estimate that the average Medicare patient would need a dosage of 5 grams, and the wholesale acquisition cost of a dose is $3,500. Medicare rules direct that NTAP amounts are set at the lesser of 50% of the average cost of the technology or 50% of the cost above the DRG payment for the condition. CMS anticipates that the drug could increase Medicare spending in 2017 by almost $15m (see box).

Vistogard For Fluorouracil Toxicity Gains NTAP

NTAPs have been used for only a handful of drug products, but this year CMS agreed to provide it for two new ones. In addition to Praxbind, CMS says another antidote product, BTG International Inc.'s Vistogard, meets the criteria.

NTAP Bottom Line

Estimated increase in Medicare's overall FY 2017 spending from drug products receiving added payments:

• Praxbind: $14,766,500 ($1,750 x 8,438 patients)
• Blincyto: $4,593,034 ($27,017.85 x 170)
• Vistogard: $2,812,500 ($37,500 x 75)

Vistogard (uridine triacetate) is approved as an antidote to fluorouracil toxicity resulting from use of the chemotherapeutic agent 5-fluorouracil. It was approved Dec. 11, 2015, but CMS accepted BTG's recommendation that the date of its "newness period" for Medicare purposes should be March 2, 2016. Commercial availability was delayed to March due to the need for receipt of final labeling, contract manufacturing schedules, and final packaging, CMS notes.

The supplemental payment was set at $37,500, based on a wholesale acquisition price of $3,750.00 per 10 gm packet of oral granules, and recommended adult dosing of one packet every six hours for a minimum of 20 doses over five days, translating into $75,000 per patient. However, a relatively small number of patients are projected to need the treatment.

The new rules also address two products that already have NTAPs. The supplemental payment will cease to be provided in 2017 for CSL Behring's Kcentra, a replacement therapy for fresh frozen plasma for patients with an acquired coagulation factor deficiency due to warfarin and who are experiencing a severe bleed.

CMS says Kcentra's "newness period" started on its April 29, 2013 FDA approval. Because the three-year anniversary from that date would occur before FY 2017, the product no longer meets the NTAP's newness standard.

Amgen Inc.'s leukemia treatment Blincyto (blinatumomab) gained NTAP status for 2016, and it will continue into 2017. In the previous evaluation, CMS based the supplemental payment on its evaluation that a "17-day length of treatment cycle is representative of historical and current practice." Amgen had sought to set the NTAP higher, based on a full 28-day treatment. CMS based the treatment length it used on the first and second cycles of treatment, saying the data it received showed that only "a small number of patients also received three to five treatment cycles."

At the time, the Medicare agency said it would reconsider that decision for 2017 if new data on treatment length became available, but says in the final rules that it had not received any such data for review.