Medicare Proposes to Restrict Coverage of Controversial and Costly Alzheimer's Drug
Health Care

Medicare Proposes to Restrict Coverage of Controversial and Costly Alzheimer's Drug

© Brian Snyder / Reuters

Medicare officials on Tuesday proposed limiting coverage of a controversial and expensive new Alzheimer’s drug to patients in approved clinical trials. The proposal could sharply limit the number of patients who use Biogen’s Aduhelm, a monoclonal antibody treatment for Alzheimer’s, which has faced questions about both its cost and its effectiveness. The decision also applies to similar drugs in development.

The preliminary proposal by the Centers for Medicare and Medicaid Services (CMS) is highly unusual. “CMS almost never demands such trials for a drug already approved by the Food and Drug Administration,” The Washington Post’s Laurie McGinley and Amy Goldstein note.

Dr. Lee Fleisher, the chief medical officer and director of the Center for Clinical Standards and Quality at CMS, said in a statement that the proposal “is the result of robust evidence analysis conducted through a thorough review process that found while there may be the potential for promise with this treatment, there is also the potential for harm to patients.”

How we got here: Aduhelm last year became the first new Alzheimer's disease treatment approved by the Food and Drug Administration in nearly 20 years. But the approval sparked controversy given lingering questions about whether the drug works — and fears that the drug could devastate Medicare’s finances given the prevalence of Alzheimer’s and Biogen’s original price for the drug, $56,000 a year.

Medicare in November announced a record premium increase in dollar terms, based partly on the potential cost of covering Aduhelm. But after the drug saw dismal early sales, Biogen last month said it would cut Aduhelm’s cost in half, to $28,200 a year., CEO Michel Vounatsos said Monday that the company’s initial pricing was “wrong.” Health and Human Services Secretary Xavier Becerra on Monday said he is instructing CMS to reassess the Medicare premium increase based on the drug’s new pricing. “With the 50% price drop of Aduhelm on Jan. 1, there is a compelling basis for CMS to reexamine the previous recommendation,” Becerra said.

The controversy will continue: The CMS coverage decision upset Biogen, some patients and patient advocates, who had high hopes for the drug. “With this proposal, CMS is writing off an entire class of medicines before multiple products have even been reviewed by FDA, positioning itself and not FDA as the key arbiter of clinical evidence,” Nicole S. Longo, a spokesperson for PhRMA, the drug industry trade group, said in a statement. “Instead of erecting more barriers, we encourage CMS to reconsider this ill-advised decision and work to address the significant and urgent needs facing patients with Alzheimer’s disease.”

But critics of the drug lauded the decision. “Biogen’s outrageous original price for Aduhelm, $56,000 per year, is the poster child for how dysfunctional our drug pricing system has become and it is the perfect example of why Medicare should be negotiating drug prices with the pharmaceutical industry,” Sen. Bernie Sanders (I-VT) said in a statement.

The CMS proposal will be open to public comment for 30 days, with a final decision due in April.