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Earlier this week we issued a report on PBM business practices coming under increased scrutiny at the federal level. Well, the bullseye is not limited to federal action with increased activity at the state level as well.

As the article below details, a feisty, independently-owned specialty pharmacy in California took CVS Caremark to arbitration….. and won. The small pharmacy claimed that CVS was in breach of contract and that the pharmacy was owned 100% of the direct and indirect remuneration (DIR) fees that had been clawed back from the pharmacy….. a cool $3.6million!!

Although DIR fees were included in the pharmacy contract, CVS recouped 150% of the pharmacy’s net profit, in effect, forcing the pharmacy to lose money. The arbitrator found that CVS failed to show adequate calculations for calculating the fees.

Attorneys representing the pharmacy say that the controversy around DIR fees are widespread and a threat to independent pharmacies. They also claimed that they were able to “invalidate Caremark’s DIR fees in entirety.”

Perhaps it is time for other specialty pharmacies to evaluate their legal bases for DIR restitution.

CLICK HERE to read the full article

Specialty Pharmacy serving HIV patients wins arbitration against CVS in rare public case

Confidentiality agreements typically prevent the public from obtaining a window into the cases against pharmacy behemoths but a public court filing makes this one different.

Jun 23, 2022 — A small, woman-owned specialty pharmacy in San Francisco serving HIV-positive patients has won a case against CVS Caremark, but the pharmacy benefit manager refuses to pay, and now the case is public.

CVS Caremark owes Mission Wellness $3.6 million after an arbitrator ruled in favor of the small pharmacy that accused CVS of breach of contract, and the arbitrator ordered CVS to return 100% of the direct and indirect remuneration (DIR) fees recouped from Mission Wellness. DIR fees include any kind of remuneration Part D Plan Sponsors (PDPs) or their PBMs receive from any source after the point of sale that offsets the PDP’s costs. In this case, Silverscript was the plan sponsor and the point of sale applies to Mission Wellness.

According to the lawsuit, CVS Caremark inaccurately assessed DIR fees agreed upon in the contract with Mission Wellness. In 2020, CVS recouped 150% of Mission Wellness’ net profit. And so while CVS was docking Mission Wellness’ pay when it was participating in Caremark’s Medicare Part D networks, the small pharmacy was losing money.

While Medicare Part D is a governmental prescription drug program for those aged 65 or older – called SilverScript, HIV patients qualify for Medicare regardless of age.

In arbitration documents made public this week, Mission argued that it was not reasonable for CVS to pay Mission a negative reimbursement rate under “take it or leave it” contractual terms, as this is not the contract they agreed upon. The arbitrator agreed, ruling that CVS failed to show adequate calculations for coming up with the fees it imposed.

“Caremark and SilverScript have profited at the expense of Mission Wellness, HIV patients and Medicare,” according to a news release from Mission Wellness on Tuesday.

It’s a rare occasion that arbitration between a small, minority-owned specialty pharmacy serving HIV patients and a pharmacy behemoth like CVS would be unsealed. Confidentiality agreements and “gag clauses” prevent the public from obtaining a window into the cases against pharmacy benefit managers. But this case was brought into the public eye after Mission Wellness filed a case in Arizona District Court asking a judge to confirm the arbitration award and force CVS to dish out the money it owes the pharmacy.

Jonathan Levitt, who represents Mission Wellness, said his firm Frier Levitt has helped clients win several such awards, which pharmacy giants such as CVS or Cigna pay following arbitration with specialty pharmacies. However, they are never able to talk about those wins publicly because they’re confidential.

Meanwhile, CVS Caremark said it had recouped DIR fees that Mission Wellness owed because the San Franscisco pharmacy didn’t follow adherence metrics, which show how well a drug is working for a patient. But Levitt claimed that Mission Wellness has the data to show they did follow adherence metrics. In particular, since the case involves HIV drugs for which they do blood testing to see if the drug is working, there is no question that Mission Wellness followed adherence metrics, Levitt said.

During arbitration, CVS Caremark failed to provide the adherence metrics they were basing their claims off of, according to Levitt.

CVS Health, which owns CVS Caremark, did not respond to request for comment.

Following the Federal Trade Commission’s announcement earlier this month that they’re investigating the “drug middleman industry,” involving pharmacy benefit managers, such as CVS Caremark, Levitt expects these victories against PBMs to be less shrouded in darkness .

“Everyone’s afraid to tell the FTC what’s going on because of confidentiality clauses and gag clauses, but this is exactly what the FTC is asking about,” Levitt said.

He hopes the victory shows that specialty pharmacies should be aware they have rights under federal law, that can be vindicated in a court of law.

The case is 2:22-cv-00967 in the District Court of Arizona.

By AMANDA JAMES

PBMs continue to be under the microscope. The scrutiny comes on the heels of the FTC announcing that it was reversing its decision to shelf taking action on the issue. The FTA received more that 20,000 \nasty grams’ demanding that they live up to their mission of defending FAIR TRADE. 

Organizations including the APhA, AHA, and NASP all joined hands to put the pressure on. It contributed to a meaningful turnaround with a “5-0 vote at the FTC to initiate a study to scrutinize the impact of vertically integrated pharmacy benefit managers on the access and affordability of prescription drugs….. as well as PBMs’ unfair, deceptive, or anticompetitive business practices have impacted pharmacies and patients.”

All that sounds promising….. but, where’s the teeth to ensure compliance? Well, the FTC would be given broad enforcement powers. Violations could incur civil penalties up to $1,000,000. Additionally, state attorneys general could bring civil actions if they believe that patient interests are being abridged. Whistleblowers are even protected. 

Time will tell what the legislation looks like at the end of the Congressional process.
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APhA welcomes FTC study of PBMs’ anticompetitive business practices – urges agency to act

June 7, 2022 – WASHINGTON, D.C.—The American Pharmacists Association (APhA) issued the following statement applauding the FTC’s announcement of a 5-0 vote to initiate a 6(b) study “to scrutinize…..

CLICK HERE to read the full press release from APhA

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PBMs Continue to Draw Federal Scrutiny: PBM Transparency Act of 2022

Thursday, June 30, 2022As we noted in our last PBM Regulatory Roundup, there has been a wave of state regulation focused on PBM practices in the wake of Rutledge and Webhi. However, PBMs are also facing federal reform efforts. The Pharmacy Benefit Manager (PBM) Transparency Act of 2022 (the Act) was recently proposed in the U.S. Senate and ………………

CLICK HERE to read the full article posted by The National Law Review

Biosimilars are still struggling to gain maximum traction in the marketplace….. and a recent survey says that communications are at the heart of the problem.

Some of the highlights include:
Oncologists felt that switching decisions were typically initiated by pharmacies (29.0%) or hospital/treatment centers (19.4%). Note, there is only a handful of biosimilars with ‘an interchangeable’ designation.
Patients (55.2%) said they were given an option to switch to a biosimilar. 63.9% went through with the switch / 8.6% declined to switch.
Patients reported (40.8%) that they were never notified of a payer driven biosimilar switch, and only 26.4% said their oncologist or physician briefed them.
The top three most common reasons for switching, as reported by oncologists

• Payer requirements (23.5%),
• Biosimilars were considered identical (14.1%), and
• Hospitals wanted to save money (12.9%).
  Only 9.3% of patients felt that the payers could be trusted to make the right decisions about switching! It is also noteworthy that only 12.1% of oncologists felt similarly!
  35.3% of patients felt they had been given the opportunity to ask questions about biosimilars
  Only 43.4% of patients felt that the biosimilar would be as effective in treating their cancer! And, only 79.4% of oncologists felt the biosimilar would be just as effective as the reference product!!!

As the researchers said, “If biosimilar acceptance is to grow, it’s going to take a great deal of work to improve the levels of trust between payers, patients, and oncologists.”

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Researchers Identify a Communications Breakdown Over Herceptin Biosimilars

June 6, 2022Researchers have identified what they say is a critical lack of communication about biosimilars between patients with breast cancer and their oncologists, based on surveys conducted from 2020 to 2021.

They also said many switches from the reference product Herceptin (trastuzumab) are dictated by payers and much needs to be done to improve the levels of trust between payers, patients, and oncologists if biosimilar acceptance is to grow.

“There is a need for tailored and effective patient and oncologist information and education on trastuzumab biosimilars, along with improved health care communications regarding switching,” wrote lead author Elizabeth Lerner Papautsky, Ph.D., M.S., an assistant professor in the Department of Biomedical and Health Information Sciences at the University of Illinois at Chicago. Papautsky and her colleagues reported their results in May in the journal Breast Cancer Research and Treatment.

In two separate surveys, Papautsky and her colleagues collected responses from 143 patients with breast cancer and 33 medical oncologists. The researchers said that 63.9% of patients reported they had been switched to a trastuzumab biosimilar–most often Kanjinti (69.8%)–and of those, 40.8% reported they had been given no prior notice they would be switched.

In none of the responses did oncologists ever say that the switch to a biosimilar was initiated by them. It was most commonly the case that the switch was mandated by the payer (45.2%). Oncologists were much more likely than patients to report satisfaction with the way biosimilar information had been communicated.

“The discrepancy between patient-reported experiences and oncologists’ perceptions of the patient experience suggests a lack of adequate information that may be a challenge not only to the uptake of trastuzumab biosimilars, but to the patient oncologist relationship,” Papautsky and her fellow researchers wrote.

The authors expressed strong concern that these communication gaps be rectified because, they said, Herceptin is a costly drug and biosimilars represent an important opportunity to improve patient access and lower the cost of health care. Payers have latched onto the savings aspect, they said. “Literature suggests that with increasing availability of biosimilars, a variety of switching scenarios have become common across disease types.”

They cautioned that “with guidelines often being vague, the practice of switching is largely unregulated.”

Because of the above-described patient/doctor disconnect on biosimilars, many patients resorted to self-directed research to find out about these biologic alternatives, the report said.

Among patients participating in the survey, 58.1% were fully covered by private insurance and 99.3% and 91.4% were female and white, respectively. Responding oncologists were most likely to work in an urban setting (68.0%) or at an academic center or affiliate (35.3%).

Despite the communication problems, most patients (55.2%) said they were given an option to switch to a Herceptin biosimilar–it wasn’t forced on them. And of patients who responded, 63.9% went through with the switch. Papautsky said 8.6% declined to switch.

However, lack of prior notification about switching was a problem, patients reported (40.8%); and just 26.4% said their treating oncologist or physician briefed them beforehand about biosimilars. Smaller percentages of patients said they got that type of information instead from advanced practice practitioners (5.7%), chemotherapy nurses (15.5%), or others.

Oncologists said that if not dictated by payers, switching decisions were typically initiated by pharmacies (29.0%) or hospital/treatment center administrations (19.4%).

The three most common reasons for switching, as reported by oncologists, were payer requirements (23.5%), biosimilars were considered identical to Herceptin (14.1%), and hospitals wanted to save money (12.9%).

Few patients or oncologists felt that the payers could be trusted to make the right decisions about switching (9.3% vs 12.1%, respectively). Patients were less likely than oncologists to agree they had been given the opportunity to ask questions about biosimilars (35.3% vs 58.8%) or that the biosimilar would be as effective in treating the cancer (43.4% vs 79.4%).

Tony Hagen, Managed Healthcare

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Anton RX Reports are copyrighted by Anton Health, LLC.

June 28, 2022
Winter Garden, FL
The FDA recently approved a new sub-cutaneous, specialty therapy, Amvuttra (vutrisiran) from Alnylam Pharmaceuticals, for the treatment of the polyneuropathy of hereditary transthyretin-mediated (hATTR) amyloidosis in adults.

Hereditary ATTR including polyneuropathy is a rare condition that has had few treatment options. It affects about 50,000 people worldwide. The disease is rapidly progressive with a high mortality rate.

Amvuttra is administered via subcutaneous injection once every three months (quarterly). The prescribing information for the product states that it should be administered only by a medical professional.

Amvuttra joins the market with another Alnylam product, Onpattro, with the same indication. Amvuttra is sub-q, whereas Onpattro is infused. Amvuttra has a potential to treat another form of ATTR that affects the heart. That indication, called ATTR cardiomyopathy, may reach $1.8 billion in global sales by 2026.

Alnylam is pricing Amvuttra at an annual list price of $463,500. Given the small patient population in the US, it is expected that Amvuttra will launch through limited distribution (direct-to-office). By way of reference, Onpattro launched in 2018 via LD provided by US Bioservices and Orsini Healthcare.

CLICK HERE to access full prescribing information for Amvuttra

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Alnylam Announces FDA Approval of Amvuttra (vutrisiran)
RNAi Therapeutic for the Treatment of the Polyneuropathy of Hereditary Transthyretin-Mediated Amyloidosis in Adults

CAMBRIDGE, Mass.– Jun 13, 2022 — Alnylam Pharmaceuticals, Inc., the leading RNAi therapeutics company, today announced that the U.S. Food and Drug Administration (FDA) approved Amvuttra (vutrisiran), an RNAi therapeutic administered via subcutaneous injection once every three months (quarterly) for the treatment of the polyneuropathy of hereditary transthyretin-mediated (hATTR) amyloidosis in adults. hATTR amyloidosis is a rare, inherited, rapidly progressive, and fatal disease with debilitating polyneuropathy manifestations, for which there are few treatment options. The FDA approval is based on positive 9-month results from the HELIOS-A Phase 3 study, where Amvuttra significantly improved the signs and symptoms of polyneuropathy, with more than 50 percent of patients experiencing halting or reversal of their disease manifestations.

“Twenty years ago, Alnylam was founded with the bold vision for RNA interference to make a meaningful impact on the lives of people around the world in need of new approaches to address serious diseases with significant unmet medical needs, such as hATTR amyloidosis. Today, Amvuttra has the potential to change the standard of care for people living with the polyneuropathy of this devastating disease,” said Yvonne Greenstreet, MBChB, Chief Executive Officer of Alnylam Pharmaceuticals. “We are so thankful to the patients, families and investigators involved in making Amvuttra a reality for the hATTR amyloidosis community. As the fifth RNAi therapeutic developed by Alnylam to receive regulatory approval in less than four years, we believe Amvuttra represents an important milestone that brings us one step closer to achieving our P 5 x25 goals aimed at Alnylam’s transition to a leading biotech company.”

The word on the street is that CVS has acquired US Bioservices from AmerisourceBergen….. and it seems that CVS is treating it as a closely guarded secret. CVS only issued a ‘notice of a recent transaction’ only sufficient to meet SEC disclosure requirements. Moreover, the acquisition price was neither disclosed nor even hinted at. That alone seems very atypical for a top tier specialty pharmacy acquisition.

It has now been over two weeks and only one other blog post has so far made a passing reference to the deal!

US Bioservices was first acquired by Amerisource Bergen (ABC) in early 2003 for $160 million. It has been a leading specialty pharmacy….. but never gained sufficient traction to break into the Top 10 nationally. None the less, it is said to have turned in a very meaningful $1.5+ billion in 2021….. nothin’ to sneeze at!

Is this acquisition a surprise?
Not at all….. CVS acquired a variety of specialty pharmacy assets over the past decade. Does US Bioservices fill any other missing asset gaps?…. not really. CVS nailed down geographic access nationally years ago. There may be some payer deals that will be accretive to the CVS portfolio. CVS has many footholds in limited distribution deals with pharma (there might be a few therapies where CVS was not invited to play). And, there might also be some elements of specialty distribution that accrued to US Bio because of the ABC affiliation…. but, nothing is readily discernable.

So, why did AmerisourceBergen pull the plug on US Bioservices?
First, it is unlikely that ABC needed the cash…. unless ABC has plans to invest in a totally new direction. Second, wholesalers have stumbled trying to leverage their purchasing positions while simultaneously driving specialty pharmacy revenues in their owned SP shops. By comparison, Cardinal exited specialty pharmacy a few years ago. And, after several failed attempts over the past decade+, McKesson remains the lone holdout following its acquisition of Biologics which has had a stellar run competing for limited distribution therapies…. often as the exclusive provider.

The topic of the article below did not get much coverage in the media….. and that is unfortunate….. the issue should be important to all specialty pharmacies doing any substantial volume as a distributor/3PL provider.

As noted, the FDA is proposing some major rule changes that would establish a single national standard for wholesale drug distributors (WDDs) and third-party logistic providers (3PLs) with the goal of eliminating state level licensure. The FDA cites the changes are driven by conflicts in state requirements (especially vexing for entities with facilities in multiple states) and added unnecessary costs to the distribution chain.

While a single national license sounds efficient, the devil is always in the details.
Some of the key ‘details’ include:
Requiring all 3PLs to obtain a license for each 3PL facility.
Establishing “Approved Organizations,” third-party organizations approved by states and FDA to review entity qualifications and conduct facility inspections (likely with increased frequency).
Licenses will be facility and owner specific, and not transferable when there is a change of entity ownership.
New requirements related to storage and handling practices, personnel, policies and procedures, record-keeping, and reporting
And….. much confusion will arise when both a state and the feds still have licensure requirements.

Specialty pharmacies should prepare for rule changes that may be issued later this year.

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One License to Unite Them All: FDA Proposes National Standards for Wholesale Distributors and Third-Party Logistic Providers

The US Food and Drug Administration (FDA) has issued a proposed rule— “National Standards for the Licensure of Wholesale Drug Distributors and Third-Party Logistics Providers” (Proposed Rule)— pursuant to FDA’s obligations under the Drug Supply Chain Security Act (DSCSA or the Act) that, when finalized, would require all US wholesale drug distributors (WDDs) and third-party logistic providers (3PLs) to be licensed according to a national standard.

In 2013, Congress enacted the DSCSA as part of the Drug Quality and Security Act (DQSA) to address and decrease the amount of counterfeit, stolen, contaminated, or otherwise harmful drugs in the US supply chain. Among the principal objectives of the new law was requiring implementation of an interoperable system to electronically track and trace most prescription drugs distributed in the United States and establishing national licensure standards for WDDs and 3PLs.

Once final and effective, the Proposed Rule will replace the defunct 21 CFR § 205 (Part 205), which currently provides guidelines for state licensing. Specifically, the new Part 205 will standardize requirements for licensure applications; storage and handling of prescription drugs, including facility requirements and security; personnel qualifications; and recordkeeping. Notably, when final, the rule will preempt state and local licensure requirements that are different from the new national standards. Until this rule is finalized, however, the current disparate system of different state licensing and compliance requirements will remain intact.

The rule will not, however, preempt “areas within the historical police powers of States, . . . including prohibiting employees of WDDs and 3PLs from engaging in criminal activity related to prescription drugs,” so long as the state requirements are not related to licensure.

Historically, states have set their own standards for WDD and 3PL licensure, which resulted in significant differences in requirements, creating difficulties for entities with facilities in multiple states. According to comments on a prior guidance, compliance with the different state standards is time consuming and adds unnecessary costs to the distribution chain.

Some of the proposed changes in the Proposed Rule include the following:

Requiring all 3PLs to obtain a license for each 3PL facility. Currently, not all states require 3PL licensure. Moreover, under the proposed regulation, if an entity engages in both 3PL and WDD activities, it would need to obtain separate licenses and implement separate systems and processes for each function.
Requiring all WDDs to obtain a license for all facilities. While all states require distributors of prescription finished products to be licensed, the new rule will also require distributors of bulk drug substance to hold a license.

Establishing “Approved Organizations,” which will be third-party organizations approved by states and FDA to review entity qualifications and conduct facility inspections. This proposal may have the effect of increasing the frequency that facilities receive inspections, requiring facilities to increase focus on maintaining inspection readiness. Notably, however, even with these new organizations, licensure decisions would still need to be made by either the state or FDA.

While the regulation establishes a federal licensing structure, if a WDD or 3PL’s facility is located in a state with state-licensing requirements, the facility will need to obtain a state license (rather than a federal license). This is particularly notable for 3PLs that ship product in interstate commerce. State-licensed 3PLs will still need to obtain licenses in both the facility’s home state and states into which a product is sent (to the extent required). However, if the 3PL is licensed on the federal level, it will not be required to obtain out-of-state licenses. Unlike 3PLs, WDDs will still be required to obtain licensure from the state into which the drug is distributed (to the extent required), regardless of whether the WDD’s facility is licensed on the federal or home state level.

Licenses will be facility and owner specific, and, thus, will not be transferable when there is a change of entity ownership. In the case of a corporation, a change in ownership will occur when there is a merger into another corporation or consolidation of corporations, resulting in the creation of a new corporation. The transfer of corporate stock or the merger of a corporation into the licensed corporation will not constitute a change of ownership.

Licensed facilities will need to comply with new requirements related to storage and handling practices, personnel, policies and procedures, recordkeeping, and reporting.

3PLs holding state licenses will need to obtain new licenses under the new licensure requirements once the proposed rule goes into effect. It is unclear whether WDDs holding state licenses will also need to obtain new licenses.

The regulation will provide for a phased implementation program, with the effective date of the regulation dependent on whether an entity is a 3PL or WDD. Even once effective, FDA also intends to exercise its enforcement discretion for certain activities.

Key Takeaways
In many ways, the Proposed Rule would simplify the licensure of 3PL and WDD services, as it will preempt the current patchwork of licensing standards across states. However, in some respects, the Proposed Rule may result in additional compliance obligations for facilities. This is especially true for 3PLs that are in states that do not currently require licensing, and that may never have been inspected.
While the Proposed Rule would create a standardized system of 3PL and WDD licensing, facilities will still face state differences. By example, facilities that handle, ship, and/or distribute controlled substances and/or listed chemicals will still need to comply with potentially disparate federal and state regulatory requirements, as the Proposed Rule does not impact the regulation of these products.
While it may still be some time before the current Proposed Rule is enacted and effective, this is a first step toward creating a uniform WDD and 3PL licensing and compliance system. Accordingly, entities should monitor the rule’s developments to ensure that there is sufficient time for the implementation of new requirements.

Specialty pharmacies have, presumably, been preparing to implement new workflows to accommodate the anticipated January launch of new CMS regulations related to copay accumulator transactions. However, in the wake of a pharma lawsuit, a federal court has vacated the new rule leaving the marketplace unsure what changes, if any, will be required.

The Rule would have required drug manufacturers to implement mechanisms by January 1, 2023, to ensure that financial assistance for drug copays is passed on directly to patients. Such actions would also have resulted in pharmacies implementing new procedures on their end. As detailed below, one scenario would have pharmacies retro-processing rebate / refunds to patients….. which might be an operational nightmare….. let alone associated reporting.

The government has until mid-July to appeal the court’s decision. If not, the Rule will not go into effect in January.

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Federal District Court Vacates Copay Accumulator Adjustment Rule: Programs Remain the Same for Now

On May 17, the U.S. District Court for the District of Columbia issued a decision vacating the Accumulator Adjustment Rule, regulations issued by the Centers for Medicare and Medicaid Services (CMS) in December 2020 as part of a Final Rule that addressed drug copay accumulator adjustment programs (the Rule).

Background on Accumulator Adjustment Rule
CMS promulgated the Rule to address concerns over accumulator adjustment programs – called copay accumulator or maximizer programs – implemented by insurers and their pharmacy benefit managers (PBMs). In a Proposed Rule issued in June 2020, CMS indicated that PBMs believe manufacturer financial assistance programs intended to reduce out-of-pocket costs encourage patients to use more expensive drugs. To avoid paying higher costs, PBMs implement copay accumulator programs to prevent the financial assistance offered by drug manufacturers from counting toward patients’ deductibles, thereby discouraging patients from using more expensive drugs. The Proposed Rule addressed the issue through proposed changes to Medicaid drug rebate program (MDRP) policies, which were intended to encourage manufacturers to take steps that would ensure copay assistance programs accrue to patients. However, manufacturers argued they were not able to circumvent PBM copay accumulator programs to ensure patients received the assistance.

To meet this stated goal, the Rule would have required drug manufacturers to report the copay assistance in their calculation of a drug’s “best price” for MDRP purposes, to the extent that the value of the financial assistance was not passed on to the patient. Under the MDRP, drug manufacturers must pay rebates to state Medicaid programs for brand name drugs that are calculated, in part, based on a drug’s “best price,” or the lowest price available from the manufacturer. Including financial assistance in the best price would lower the best price, resulting in increased rebate liabilities. The hope was that manufacturers would ensure that financial assistance is passed on to patients to avoid paying higher rebates.

However, manufacturers expressed concern that they are not in a position to ensure that their financial assistance is being passed on directly to patients and not to payors. Nevertheless, CMS finalized its proposal, although the agency delayed the effective date to January 1, 2023, in response to manufacturer concerns. CMS indicated that the delayed effective date would give manufacturers more time to implement mechanisms to ensure that financial assistance goes directly to patients. Specifically, CMS outlined several potential mechanisms that manufacturers could use to meet these goals. For example, manufacturers could contract with vendors to track financial assistance provided at the point of sale, or they could require patients to pay for their drugs and then request the assistance from the manufacturer afterward, in the form of a rebate.

PhRMA Lawsuit
Pharmaceutical Research and Manufacturers of America (PhRMA), the trade association for brand name drug manufacturers, filed a lawsuit challenging the Rule in May 2021. PhRMA argued that the Rule was inconsistent with the Medicaid Statute and violated the Administrative Procedure Act (APA). The challenge focused on the statutory definition of “best price” under the MDRP and whether financial assistance programs offered by drug manufacturers to patients are transactions that can be included in the best price calculation.

The court sided with PhRMA, finding that the statute defines best price as the lowest price available from the manufacturer to specific best-price eligible purchasers – including wholesalers, retailers, providers, health maintenance organizations, nonprofit entities, or governmental entities – and patients are not best-price eligible purchasers.

CMS contended that manufacturer financial assistance to patients is effectively a price given to insurers, which are best-price eligible purchasers because insurers access the benefit of copay financial assistance when they prevent the assistance from counting toward deductibles. However, the court rejected this argument, finding that the assistance is going to the patient, not the insurer. The court granted PhRMA’s motion for summary judgment and vacated the Rule.

Implications for the Specialty Pharmacy Industry and Next Steps
Pharmacies, hubs, copay vendors, and drug manufacturers have been following developments related to implementation of the Rule. In particular, CMS indicated that one potential mechanism that manufacturers could implement would involve patients paying full price at the point of sale and then submitting a rebate request to the manufacturer for financial assistance. Under such mechanisms, pharmacies could play a role in collecting payments from patients and submitting rebate requests or refunding patients in some way to ensure that the financial assistance is passed on directly to patients.

The government has 60 days to decide whether to appeal the decision. In the meantime, if the court’s decision stands, stakeholders will not need to update copay collection procedures prior by the January 1, 2023 effective date, as planned.

The FDA recently approved a new form of therapy for ALS. Normally, a new form is not big news, but, for this therapy, it may be a lifeline. The approval was for an oral form of Radicava manufactured by Mitsubishi Tanabe.

Radicava is not a cure and does not restore function. Results showed that Radicava-treated patients lived nearly two times longer than those not given the therapy (median of 49 vs. 25 months).

Why is this a lifeline for Radicava?
First, there are only 12,000 to 15,000 people in the U.S. with ALS. But, it is a surprisingly competitive market with five drugs currently approved to treat ALS and its symptoms. They include Radicava, Rilutek, Tiglutik, Exservan, and Nuedexta. Secondly, Radicava was previously available only in infused form. Mobility is a huge challenge for ALS patients, so, an oral form administered in the home is competitively advantageous.

The yearly cost of infused Radicava is approximately $145,000, and each infusion session costs at least $1,000. Radicava has been available only through limited distribution since its original launch. We expect that the oral form will also be placed in limited distribution.

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Mitsubishi Tanabe scores FDA nod for oral version of its ALS drug Radicava

Five years after the FDA approved Mitsubishi Tanabe’s Radicava as an infused treatment for Lou Gehrig’s disease, the U.S. regulator has signed off on its oral version.

Hour-long infusions at a clinic, 10 days a month: Patients with amyotrophic lateral sclerosis (ALS) have had to endure an onerous treatment regimen.

But on Thursday, the FDA signed off on an oral version of Mitsubishi Tanabe’s Radicava, which can be taken at home and, if necessary, through a feeding tube.

When Radicava was initially approved in 2017, it was the first new treatment in 22 years for ALS—also known as Lou Gehrig’s disease. While the condition is fatal, usually two to five years from diagnosis, Radicava has been shown to slow its progression by roughly a third. Patients with ALS lose the ability to control their muscles, making it difficult to walk, eat, breathe and talk.

The new FDA endorsement is based on evidence showing that the oral version can deliver the same concentration of medicine to the bloodstream.

The oral Radicava is taken in the morning on an empty stomach and is administered with the same frequency as the infused version. The drug is introduced into the body with doses for 14 straight days, followed by 14 drug-free days. For maintenance, patients take it 10 out of 14 days, followed by 14 days with no medicine.

After Radicava won approval in Japan and South Korea in 2015, the FDA reached out to Mitsubishi Tanabe to apply for an orphan drug nod in the United States. The blessing came less than a year after submission and was based solely on a successful trial of the drug in Japan.

Those who take Radicava can have side effects such as bruising, headache and gait disturbance.

The FDA recently approved the fourth pegfilgrastim biosimilar referencing Neulasta, Fylnetra (pegfilgrastim-pbbk) from Amneal Pharmaceuticals. Fylnetra is a leukocyte growth factor indicated to decrease the incidence of infection, as manifested by febrile neutropenia, in patients with non-myeloid malignancies receiving myelosuppressive anti-cancer drugs associated with a clinically significant incidence of febrile neutropenia.

Can the market support four biosimilars with the same indication? Yes….. in time.
According to IQVIA, U.S. annual sales for pegfilgrastim for the 12 months ended March 2022 were $3.1 billion, $1.0 billion of which represented biosimilar sales. There is certainly a lot of room to gain share even in an already crowded category.

Amneal did not indicate a price point for the launch of Fylnetra. The GoodRx price for each of the biosimilars already on the market have broken the $4000 threshold. One might expect that additional competition would put further downward pressure on launch price or discounting off WAC. The cost for brand Neulasta is over $6000, positioning the current biosimilars at a 30+% discount to the brand.

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Amneal Achieves Third U.S. Biosimilar Approval with Fylnetra (pegfilgrastim-pbbk)

May 27, 2022 — Amneal Pharmaceuticals, Inc. (NYSE: AMRX) (“Amneal” or the “Company”) today announced that the U.S. Food and Drug Administration (“FDA”) has approved the Company’s Biologics License Application (“BLA”) for pegfilgrastim-pbbk, a biosimilar referencing Neulasta. The product will be marketed under the proprietary name Fylnetra.

Fylnetra was developed in collaboration with Kashiv Biosciences, LLC, located in Chicago, Illinois. It is used to treat neutropenia which is commonly experienced by patients undergoing chemotherapy.

This marks the third biosimilar approval Amneal received this year for products used in oncology, the second-largest biosimilar category in the U.S. Earlier this year, Amneal received approval of Releuko (filgrastim-ayow), a filgrastim biosimilar referencing Neupogen, and Alymsys (bevacizumab-maly), a bevacizumab biosimilar referencing Avastin. Amneal expects to launch these three products over the second half of 2022, along with a full patient support program.

“This is our third U.S. biosimilar approval this year and we are very enthusiastic about our future in the fast growing $28 billion U.S. biosimilars market. Biosimilars represent the next wave of affordable medicines and are closely aligned with our mission to provide high quality, affordable medicines to as many patients as possible,” said Chirag and Chintu Patel, Co-Chief Executive Officers.

“Building on our successful partnership with the recent approval of our first biosimilar, Releuko, we are pleased to receive approval for our second biosimilar. Kashiv is one of a few domestic companies to manufacture and launch multiple biosimilars in the United States. Kashiv aims to continue bringing high quality biosimilars to the global markets over the coming years. I would like to extend a humble thank you to our highly talented team, without whom this would not have been possible,” said Dr. Chandramauli Rawal, Chief Operating Officer for Kashiv.

Announcements for newly approved specialty drugs often state that the product will be available through specialty pharmacy in limited distribution. However, the press releases rarely specify the specialty pharmacy(ies) selected as the designated partner(s).

Here are several Limited Distribution deals that have been recently publicly confirmed subsequent to the approvals.

AllianceRx Walgreens Prime
Cancer-fighting Lenvima Available Through AllianceRx Walgreens Prime
May 18, 2022—Patients of AllianceRx Walgreens Prime who have certain kinds of cancer will now have access to Lenvima (lenvatinib), newly available via limited distribution.

Manufactured by Eisai Inc., Lenvima is used by itself to treat differentiated thyroid cancer (DTC) and hepatocellular carcinoma (HCC). DTC is a type of thyroid cancer that can no longer be treated with radioactive iodine and is progressing. HCC is a type of liver cancer, for which Lenvima is a first-line treatment when surgery is not an option. Lenvima also treats advanced renal cell carcinoma, a type of kidney cancer, when used in conjunction with another anti-cancer medicine. Patients with certain types of advanced endometrial carcinoma may also use Lenvima when used in combination with another anticancer medication.

Soleo Health
Named to Genentech’s Limited Drug Distribution Network for Provision of ENSPRYNG
Company to Distribute FDA-Approved Treatment for Neuromyelitis Optica Spectrum Disorder
Soleo Health announced today it has been named a limited distribution drug partner for ENSPRYNG (satralizumab-mwge), from Genentech. ENSPRYNG is indicated for Neuromyelitis Optica Spectrum Disorder (NMOSD), a rare autoimmune disease of the optic nerve, brain and spinal cord, who are anti-aquaporin-4 (AQP4) antibody positive. ENSPYRNG is a subcutaneous treatment administered every four weeks.

Soleo Health Named as Distribution Partner by Mitsubishi Tanabe Pharma for RADICAVA ORS
Soleo Health announced today it was named one of only four limited distribution drug (LDD) specialty pharmacy partners to dispense nationwide RADICAVA ORS (edaravone) oral suspension, commercialized by Mitsubishi Tanabe Pharma America, Inc. (MTPA).

The FDA approved the oral formulation of edaravone on May 12, 2022. RADICAVA ORS is among a select few FDA-approved oral treatments for patients with Amyotrophic Lateral Sclerosis (ALS), a neurodegenerative disorder. Edaravone is also approved in an intravenous (IV) formulation, known as RADICAVA® (edaravone). Soleo Health has been a limited distribution partner for the infused form since launch in 2017.

Onco360
ORGOVYX (relugolix) Now Available from Onco360 for the Treatment of Advanced Prostate Cancer
Onco360, the nation’s leading independent Specialty Pharmacy, has been named as a limited distribution specialty pharmacy partner for ORGOVYX (relugolix), a gonadotropin-releasing hormone (GnRH) antagonist that is approved by the FDA for the treatment of adult patients with advanced prostate cancer. ORGOVYX ® is commercialized by Myovant Sciences, Inc. and Pfizer, Inc.