The biggest losers from Medicare’s decision on Aduhelm may be Biogen’s competitors


By Ed Silverman, Rachel Cohrs and Nicholas Florko

January 12, 2022

Medicare may have released a plan to restrict access to the controversial Biogen Alzheimer’s drug, but the biggest losers may actually be other drug makers readying treatments for the debilitating disease.

The question is whether they encounter such difficulties and, if so, to what extent?

Under a draft policy announced by Medicare on Tuesday, any company developing a monoclonal antibody — the same type of injectable medicine as the troubled Biogen drug — would have to satisfy the same stiff requirements in order to win Medicare reimbursement. Coverage would be limited to patients enrolled in Phase 3, randomized clinical trials that are approved by the agency.

Both Eli Lilly and Roche have such treatments in the works, and Biogen has still two more, developed in partnership with Eisai, as well. All of those drug makers now have a big incentive to pressure Medicare to loosen the restrictions in the final version of its policy, which is due out this April.

“While so much of the focus has been on what this means for [the Biogen drug], this recommendation impacts an entire class of drug and is likely to result in a more aligned effort by stakeholders as they try to influence the final version,” said a consultant for different drug makers, including Biogen.

“All of the other companies have to start over,” said George Vradenburg, the founder of the advocacy group UsAgainstAlzheimer’s. “This now applies to three drugs that, in fact, might be better.”

Already, the pharmaceutical industry trade group shot back by calling the Medicare decision “ill-advised” and a “setback for patients” that removes the Food and Drug Administration as “the key arbiter of clinical evidence.” It is worth noting that the trade group chairman is David Ricks, the chief executive officer at Eli Lilly.

In a statement, Lilly called the required studies “duplicative” and “inappropriate.” Biogen argued it would take a year to enroll enough patients for a required trial, further delaying reimbursement for any drug approved by the FDA. A spokesman for Roche’s Genentech said the decision is being studied.

Lilly had previously urged Medicare to evaluate each product based on its own clinical studies. “Any limitations placed on the first FDA-approved therapies should not automatically apply to future therapies,” Lilly wrote in August.

Though Lilly opposes the decision, there’s a chance requiring randomized clinical trials for coverage for Aduhelm could actually help other companies enroll patients in clinical trials for future therapies. It puts the Medicare-approved Aduhelm trials on an equal playing field as pre-approval trials conducted by companies like Lilly, said Sean Dickson, director of the West Health Policy Center.

“This is in the best interest of moving the field forward,” Dickson said.

If Medicare’s proposal remains largely unchanged, though, drug companies actually face several key challenges. Lilly and Biogen, for instance, have both sought accelerated approvals by the FDA, which will want to see surrogate markers indicate effectiveness. And the companies hope to release late-stage study data in coming months. But this is not the type of data sought by Medicare.

“They’re going to have to go through a [Medicare] trial … Accelerated approval is off the table for this class of drugs,” said Vradenburg. “This is going to chill the hell out of the whole pipeline of Alzheimer’s drugs.”

Then there is the Medicare requirement for diversified patient populations, which may prove particularly vexing, since minority patients are often underrepresented in clinical trials, in general. And it may be even harder, here, since Alzheimer’s trials typically involve just 1,000 patients.

In fact, the overall prevalence of Alzheimer’s is higher in minorities who are eligible for Medicare coverage than in whites, with Black people being twice as likely — if not more — to have Alzheimer’s and other dementias than white people, according to John Leppard of Washington Analysis, who tracks regulatory and legislative matters that affect pharmaceutical industry investors.

“This may make it even more challenging to have these studies sufficiently powered to produce generalizable results for these populations,” he wrote in an investor note. Although the Centers for Medicare & Medicaid Services acknowledged the hurdles in its decision, he pointed out that the agency, nonetheless, maintained “it is critical that these patients are engaged, recruited, and retained in future trials.”

A big unknown is how CMS may react if one or more of the companies report late-stage study data that demonstrates their Alzheimer’s treatments are effective. Already, patient advocacy groups are furious over the CMS decision and are expected to protest still louder if that were to occur. Such a scenario raises questions about the extent to which Medicare would somehow revisit or update a final decision.

“If these trials that are underway now, assuming they do show outcome effects – not just surrogate effects – is that going to be sufficient?” said Mark McClellan, the director of the Duke-Margolis Center for Health Policy and a former CMS administrator. “[Medicare] really does need to clarify the answer to that question – like right now.”

Some are already anticipating, however, that Medicare will have to pivot.

“It is natural to assume that if these Phase 3 trials are positive – meaning they show clear cognitive and functional improvement – then [Medicare] coverage will essentially have to change,” wrote Wolfe Research analyst Tim Anderson in a note to investors. “Patients, their families, and physicians will all demand it.”

A company could ask Medicare to reopen its decision to avoid doing additional trials, particularly if its data shows strong evidence of clinical benefit for patients.

But that review process could take months longer than it would have if a restrictive national coverage policy were not in place, and there’s no guarantee Medicare officials would agree to reconsider their decision.

“There isn’t some fast-track mechanism Medicare could just use” to more quickly cover a drug that already has a national coverage policy in place, said Sean Tunis, a principal at Rubix Health who helped develop the CMS review process during his tenure at CMS.

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