We are back with a rundown of pertinent developments in the healthcare and pharma space! Here are the major developments we review this week: Medicare’s Accountable Care Organization participation in 2022, GAO report on FDA foreign inspections, EMA’s data mining center, and Aduhelm’s proposed national coverage determination.
The accountable care organization (ACO) in the Medicare Shared Savings Program (MSSP), only saw a modest increase in 2022 participation. There are currently 483 ACOs, who provide care to 11 million beneficiaries; due to the sheer size, ACOs is Medicare’s most substantial alternative payment model. ACOs decrease Medicare spending by 1-2% each year, since 2012, ACOs have saved Medicare $4.7 billion in net savings and $13.3 in gross savings. The goal of ACOs is to save money by avoiding unnecessary utilization of services and medical errors and distributing risk. ACOs take on responsibility for the total costs of care for their patients, and those that reduce the total costs of care for their patient populations can share in the savings with the payer. ACOs can also be liable to pay back losses if their costs exceed their spending benchmarks (double-sided risk). Of the current ACOs, 41% have one-sided risk while 59% have double-sided risk.
The current ACO participation numbers do not bode for the Biden administration’s goal of having every traditional Medicare patient in an accountable care model by 2030. ACOs have been on the decline since 2018, currently only about 20% of Medicare patients are cared for by ACOs. To incentivize new ACOs to join, The National Association of Accountable Care Organizations, suggested raising shared savings rates for ACO, giving additional time prior to requiring them to take on risk, adjusting quality reporting requirements, alleviating administrative burdens, solving top benchmarking and risk adjustment issues, and allowing more up to date and comprehensive data.
In a report published last week, the Government Accountability Office (GAO) raised questions about the US Food and Drug Administration’s (FDA) foreign inspections program for drugs and purported the program is overdue for an overhaul. The report came amid the agency’s ongoing challenges in conducting foreign inspections due to the COVID-19 pandemic. Early in the pandemic, FDA paused most foreign inspections, and though it had planned to resume planning those inspections, this month, the omicron variant derailed those intentions. The agency recently announced that it will proceed with previously planned foreign surveillance inspections that have received country clearance and meet federal travel recommendations, and that it plans to begin conducting prioritized foreign inspections in April.
In March 2021, FDA was responsible for overseeing more than 4,000 foreign entities manufacturing drugs for the United States, with 73% foreign entities manufacturing active pharmaceutical ingredients and 52% manufacturing finished drugs. FDA conducted 600 foreign inspections in 2019, which decreased to just 3 inspections between March and October 2020 and 18 “high-priority” foreign inspections between October 2020 and April 2021. Beyond the sharp decline in inspections, the GAO noted other potential serious issues: investigators have constrained time frames, inspections are usually preannounced, and inspectors rely on staff on-site for translation. GAO further noted a workforce recruitment and retention issue, with 8 of 20 foreign drug investigator roles and 5 of 15 drug investigator roles in China and India offices vacant as of November 2021. GAO provided three recommendations to FDA: use leading practices to start a pilot program for unannounced foreign inspections, develop a pilot program to use different types of independent translators for inspections, and use tailored strategies focused on recruiting new and developing and retaining current investigators. The FDA has started to examine these issues, but has not outlined a plan or timeframe for implementing a solution.
The European Medicines Agency has set up a new center to collect and mine more public health data from EU member states to improve the review of new drugs and provide them more quickly to patients. Real World Evidence (RWE) from hospitals and physicians' practices have been used before for regulatory reviews of drug candidates, but advances in data processing technology offer a far greater potential. The RWE would supplement data from controlled trials in a research setting. The EMA’s past use of RWE include the 2018 approval of complex cell therapies against blood cancer, Kymriah by Novartis (NOVN.S) and Yescarta by Gilead (GILD.O), where the comparison of how patients would have fared without the treatment were RWE-based. The real-world data will include how common the targeted disease is, the size of patient populations, as well as safety and effectiveness of medicines and vaccines, the statement added. Likely starting later this year, the center would also answer requests by national bodies that determine the benefits and reimbursement prices of new drugs.
Last June, the FDA granted accelerated approval to Aduhelm, Biogen’s myloid beta-directed antibody indicated to treat Alzheimer’s disease. Aduhelm was the first drug that was approved to treat Alzheimer’s since 2003; while this was a monumental step in providing an innovative treatment to patients, controversy over the efficacy and cost of Aduhelm made many wary. Following the approval, some began to recommend limiting access to a more narrow patient population, suggesting that any patient with Alzheimers is too broad an indication. These cries for more restrictions were yielded too when last month, Medicare issued a proposed national coverage determination (NCD), which stipulated drug coverage with evidence development (CED). An NCD for CED allows FDA-approved drugs to be covered for people with Medicare only if they are enrolled in qualifying clinical trials.
The proposed NCD was open to public comment for 30 days, within this period patient advocate groups and lawmakers decried the NCD submitting thousands of letters advocating for greater patient access. Notably a coalition of Down syndrome advocacy organizations, submitted comments voicing their fear that people with the condition will be blocked from accessing Aduhelm because they won’t be allowed to enroll in the clinical trials. The case of Aduhelm is contentious because Medicare has a duty to ensure access and patient safety, and while similar comments are often ignored in the NCD review process, ones of this nature could turn the tide for Adulhelm’s NCD. CMS will announce its final decision by April 11, 2022; if the proposed NCD is finalized, CMS will review each clinical trial to determine whether it meets the criteria specified for the proposed NCD. In addition to CMS-approved trials, National Institutes of Health (NIH) sponsored clinical trials would also be covered.