'Medicaid best price' changes aimed at value-based gene therapy contracts: U.S. agency - (Financial Post via NewsPoints Desk)

  • The US Centers for Medicare & Medicaid Services (CMS) said proposed changes to requirements that state-run Medicaid programs are given the best drug prices would pave the way for commercial health insurers to enter into "value-based" payment schemes, as reported in the Financial Post.

  • "The problem has been that the Medicaid 'best price' regulations are a barrier…Today we are announcing that we are updating them to allow for more value-based pricing," said CMS administrator Seema Verma.

  • According to Verma, the proposed changes are being driven by the increasing availability of very expensive, potentially curative, gene therapy treatments.

  • Spark Therapeutics, now owned by Roche, in 2018 launched its Luxturna treatment for an inherited genetic mutation that causes blindness at a price of $850,000, while Novartis last year won FDA clearance for its Zolgensma gene therapy in spinal muscular atrophy, pricing the one-time treatment at $2.1 million.

  • Verma noted that commercial health insurers have considered linking reimbursement of such drugs to outcomes, but have been hampered by the Medicaid best price rules. "If a drug didn't work in 20% of cases, in those cases the payment might be zero, which could completely alter the Medicaid best price," she explained.

  • The new proposals include calculating the best price based not just on one discount, but as a comprehensive blend of prices. They would also allow for price calculations outside of the current three-year window.

To read more NewsPoints articles, click here.