Aduhelm, an Alzheimer’s disease treatment drug approved by the Food and Drug Administration (FDA) this week, would cost $ 56,000 per year and increase health insurance premiums, according to a research report by the Kaiser Family Foundation, a non-partisan organization.
Senate Finance Committee Chairman Ron Wyden (D-OR) called the drug’s price “unacceptable”.
“It is unreasonable to ask seniors and taxpayers to pay $ 56,000 a year for a drug that has yet to be proven effective,” Wyden tweeted Tuesday. “Medicare must be able to negotiate a fair price for prescription drugs. “
Kaiser’s analysis concluded that Aduhelm’s approval “provides the latest high-profile example of the potential budgetary consequences of Medicare’s role as a price-taker in the pharmaceutical market.”
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Wednesday’s analysis comes as Democrats in Congress try to build consensus around legislation that would allow Medicare to negotiate the prices of prescription drugs.
The Kaiser Report estimated that if just 500,000 Medicare beneficiaries received Aduhelm, it would cost the program nearly $ 29 billion per year, far more than any other drug.
“At that price, the cost of this one drug could exceed all others covered by Medicare, if it is widely used,” said Tricia Neuman, co-author of the report.
Medicare has not made a formal decision on Aduhelm coverage, but cost has traditionally not been a consideration. Drugmaker Biogen has said it is pricing Aduhelm responsibly.
In addition to higher costs to taxpayers, the domino effects would include higher “Part B” premiums for outpatient Medicare coverage and monthly premium increases for millions of people with additional “Medigap” plans. As an infusion drug that would be administered in a doctor’s office, Aduhelm is covered by Medicare’s outpatient benefit. The standard Part B premium, paid by most registrants, is currently $ 148.50 per month.
Beyond the monthly premiums, there would also be impacts on reimbursable expenses. Many patients taking the drug, including those who have purchased Medicare Advantage plans from private insurers, could face thousands of dollars in user fees. The maximum could reach around $ 11,500, the researchers estimated.
This upper bound cost of patient budgets would translate to nearly 40% of the estimated median income of $ 29,650 for Medicare beneficiaries.
“Because Aduhelm is not a cure for Alzheimer’s disease, patients could bear these annual costs over several years,” the report notes.
Biogen, which developed the Alzheimer’s drug with Japanese company Eisai Co., said earlier this week that it expects gradual adoption, not a sharp “hockey stick” spike.
Biogen set the drug’s price after extensive research, said Chirfi Guindo, global product manager at Biogen. Biogen has made a commitment not to increase its prices for four years.
Guindo said the company has looked at the prices of drugs advanced to treat cancer and other complex conditions. “We rated Aduhelm at about a third of the level of cancer immunotherapies,” he said on a teleconference this week. “So we see it as a really responsible price and we see it as a sustainable price for the system.”
Medicare has a review process known as National Coverage Determination to assess new treatments that could have far-reaching implications for the program. Officials have yet to say how the program will play out with Aduhelm. Medicare may set conditions to cover the drug, depending on its clinical effectiveness.
The program covers more than 60 million people, including those 65 and over, as well as people with disabilities or severe kidney disease. Medicare spending is approaching $ 1 trillion per year.