Meena Seshamani, M.D., Ph.D.
CMS Deputy Administrator and Director of the Center for Medicare Centers for Medicare & Medicaid Services
U.S. Department of Health and Human Services
7500 Security Boulevard
Baltimore, MD 21244-8016 Attn: PO Box 8016
Re: Medicare Drug Price Negotiation Program: Draft Guidance, Implementation of Sections 1191 – 1198 of the Social Security Act for Initial Price Applicability Year 2027 and Manufacturer Effectuation of the Maximum Fair Price (MFP) in 2026 and 2027
Dear Dr. Seshamani:
We Work for Health appreciates the opportunity to share comments on the Medicare Drug Price Negotiation Program: Draft Guidance for Year 2027 (Initial Price Applicability Year [IPAY] 2027). We Work for Health brings together national and local business leaders, including labor, biopharma, patient advocacy, and other healthcare-related stakeholders to support policies that foster innovation and facilitate the delivery and lifesaving and life-enhancing medicines. As such, we share your goals of making prescription medicines more accessible and affordable to Medicare beneficiaries, but caution that implementation of the sweeping changes represented by the MDPN directly threaten those shared goals without significant diligence to avoid those harms. It is with those concerns in mind that we share the following comments on IPAY 2027.
Do More to Protect Beneficiary Access to Medicines
We are concerned by the “wait and see” approach CMS proposes in terms of protecting beneficiary access to medicines subject to the MDPN. In the IPAY 2027 draft guidance, CMS expresses concern regarding the potential for Part D plans to accelerate the use of restrictive formulary placement and utilization management techniques including step therapy and prior authorization to limit beneficiary access to medicines. Simply requiring that plans “cover” medicines subject to the MDPN is not sufficient to assure beneficiaries have access to them. We urge you to do more to protect beneficiary access to these medicines in the final IPAY 2027 guidance and avoid the predictable harms that will follow if such protections are not put into place.
Improve Transparency in the Pricing Process
In the IPAY 2027 guidance, CMS maintains the current “black box” of its decision making in the drug pricing process. Not only does CMS plan to maintain secrecy around how it will set medicine prices until months after it makes those decisions, but CMS also proposes to reduce the number of times it will meet with drug manufacturers during the process. That reduction in meetings coupled with the serious issues that limited to impact of the patient-focused listening sessions last Fall casts significant doubt on whether CMS is concerned with the clinical benefits and overall value of these medicines at all. CMS is not a scientific agency well-versed in the practice of medicine or pharmaceutical development, much less the specific knowledge needed to understand the diseases being treated. These proposals raise serious concerns about whether a medicine’s benefits and overall value to the patient, the healthcare system, and society as a whole are being appropriately evaluated. We strongly recommend that CMS build greater transparency into the decision-making process and allow for both more and more meaningful opportunities for stakeholder input, including reforms that facilitate input from beneficiaries, patients, caregivers, and providers who live with the realities of disease every day and will bear the brunt of the consequences of reduced access and less innovation.
Refine Criteria for “Selected Drug”
CMS proposes to continue using an overly broad definition and approach in identifying selected drugs for the MDPN. Specifically, CMS asserts that any form of a drug from the same manufacturer with the same active ingredient will be grouped together for price setting based on the earliest approval of any drugs in that group. This action ignores the significant contribution of follow-on treatments that may be used entirely differently, involve separate FDA approvals, and be used in clinical practice to address different health concerns. It also serves as a chilling effect on future research into new treatments whose only similarity is a shared active ingredient or moiety. That represents a huge loss for patients today and in the future. We urge CMS to reconsider and narrow the definition of “selected drug” to promote continued innovation.
Promote Biosimilar Competition by Removing Vague Marketing Condition
Provisions in the IRA fail to recognize differences in the timeline for selection for price setting and typical timelines for generic or biosimilar competition when exempting drugs with approved generic or biosimilar competitors from pricing. This flaw will severely limit the availability of generics and biosimilars but is made even worse by CMS’s addition of poorly defined criteria to evaluate the nature of that competition. Specifically, CMS proposes to evaluate whether a generic or biosimilar competitor is engaged in “bona fide marketing”. That concept fails to understand the market dynamics that have limited biosimilar access to date: insurers and PBMs determine whether these competitor drugs are covered. Forcing potential generics and biosimilars to compete with government set prices will reduce the incentives for market entry of these competitors that help significantly to lower prices and provide patients with treatment options. We strongly encourage CMS to remove the poorly defined concept of “bona fide marketing” in the evaluation of generic or biosimilar competition.
We appreciate the opportunity to share these comments and look forward to seeing these concerns addressed in the final IPAY 2027 guidance.
Sincerely,
Dan Leonard
Executive Director
We Work For Health