Pressure Intensifies to Lower Drug Prices

Laird Harrison

November 05, 2018

CHICAGO — The price of ophthalmic drugs varies widely in the United States, and this can adversely affect patient care, data from a new study show.

"Our patients are the ones who are suffering because they show up at the pharmacy and they don't know if they're paying $10 or $200," said Dan Gong, MD, from Columbia University Medical Center in New York City.

And prices are generally much higher in the United States than in other developed countries, he reported here at the American Academy of Ophthalmology (AAO) 2018 Annual Meeting.

While US clinicians can't do much about the high cost of drugs, they should pay attention to the huge variation in prices within the country, he explained.

Prices can be quite different when a drug is purchased through Medicare Part D, the Department of Veterans Affairs, a pharmacy benefit manager (such as Navitus or CVS Pharmacy), or out of pocket, Gong and his colleagues discovered.

For example, generic latanoprost sells for $2.03 through Medicaid's National Average Drug Acquisition Cost (NADAC), but on Costco.com it sells for $19.12.

Generic bimatoprost, a prostaglandin analog such as latanoprost goes for $10.00 through CVS Caremark but $217.76 on Costco.com.

"It's our responsibility as prescribers to recognize that there is this variability out there," said Gong. Some patients don't adhere to their medications because they can't afford them. Physicians can sometimes help by finding less expensive alternatives.

However, it can be hard to get this information. "It often requires picking up the phone, calling a retail pharmacy, giving the patient's identifying information, and asking the pharmacist to run it through the system to come up with the price," he explained. "But for physicians to at least be sensitive to this variation in price is important."

Sticker Shock

The disparity in prices between the United States and other countries has attracted the attention of the Trump administration. On October 25, the administration unveiled a plan to use "step therapy" to limit prices for drugs under Medicare's Part B —the drugs bought and administered by healthcare providers — to an index based on what governments in 16 other developed countries are paying.

"For one eye medication that helps prevent blindness, Medicare pays over $1 billion dollars a year," President Donald Trump said in a White House press briefing. "If we paid the prices other nations pay, we'd bring the $1 billion down to $187 million a year."

Though President Trump did not name the drug, the price comparison corresponds to an analysis by the US Department of Health and Human Services that found price of ranibizumab (Genentech/Lucentis) for Medicare is 5.4 times higher per gram in the United States than the average price in 16 other countries.

Under step therapy, insurers can require prior authorization before a drug is prescribed. The idea is to push providers to prescribe the least expensive treatment for a given medical condition. Only if that fails will the insurer authorize a step up to the next most expensive therapy.

Step therapy adds administrative burdens, with some health plans requiring authorization each time a drug is used, AAO lobbyist Cathy Cohen said at a news conference here.

And it can endanger patients' health, said David Glasser, MD, AAO secretary for federal affairs.

"Another name for step therapy is 'fail first,'" he said. "Will you have irreversible loss of vision during that interval?"

Pushing providers to prescribe a less expensive drug is particularly problematic when it comes to anti–vascular endothelial growth factor (VEGF) therapy, said Glasser.

For example, bevacizumab (Avastin, Roche), the least expensive anti-VEGF drug in the United States, is only available off label for ophthalmic indications. "So to use that drug we have to have a pretty clear conversation and understanding with our patients before we stick a needle in their eye," he explained.

Bevacizumab has also become difficult to obtain in some parts of the country because of regulations by the US Food and Drug Administration that make it more difficult to compound, he added.

The Trump administration argues that step therapy is already working to control the price of Medicare Part D drugs, which patients buy from pharmacies.

But Gong and his colleagues found that prices for Part D Medicare eye drops are sometimes much higher in the United States than in the other five countries they surveyed.

For example, generic bimatoprost sold for $269.14 through Medicare Part D but only $21.11 through the Japanese government health plan. Prednisone acetate sold for $45.33 through Medicare Part D but only $1.94 through the Canadian government health plan.

The AAO has been lobbying in a coalition with other medical specialties to end step therapy in Medicare. "We were absolutely flabbergasted when, in August, despite a year of trying to convince the administration that plans are abusing prior authorization, the administration announced that they were expanding it to Part B drugs," said Cohen.

However, she said, the administration appears committed to allowing step therapy for Part B drugs starting in January of 2019.

Physicians would not lose out under this plan because they would not buy the drugs for the patients; a vendor would. And instead of receiving a markup to cover storage and handling, physicians would be paid a flat fee that would not change if the price of the drug changes.

Many details remain to be worked out. According to the administration, the plan would go into effect gradually over the next 5 years.

Gong has disclosed no relevant financial relationships. Glasser and Cohen are affiliated with the AAO.

American Academy of Ophthalmology (AAO) 2018 Annual Meeting. Abstract PO408. Presented October 29, 2018.

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