Home Infusion Stakeholders to be Helped by Newly Introduced Congressional Legislation

According to a press release by Senator Warner (D-VA), a newly introduced “bipartisan bill in the U.S. Senate proposes to ensure Medicare patients maintain access to home infusion therapies that require the use of an infusion pump. The Preserving Patient Access to Home Infusion Act — introduced by Sen. Mark Warner (D-VA) and Sen. Tim Scott (R-SC) — would ensure patients with serious viral and fungal infections, heart failure, immune diseases, cancer, and other conditions can receive the intravenous (IV) medications they need while at home.”

The Preserving Patient Access to Home Infusion Act can be viewed here. 

How did this legislation come to be? 

“Congress included provisions in the 21st Century Cures Act and the Bipartisan Budget Act of 2018 to create a professional services benefit for Medicare Part B home infusion drugs. The intent in establishing this benefit was to maintain patient access to home infusion by covering professional services including assessments, education on administration and access device care, monitoring and remote monitoring, coordination with the patient, caregivers and other health care providers, and nursing visits.

Despite Congress’ intent — as detailed in multiple letters to the agency — the Centers for Medicare and Medicaid Services (CMS) improperly implemented the benefit by requiring a nurse to be physically present in the patient’s home in order for providers to be reimbursed. As a practical matter, the current home infusion therapy benefit only acknowledges face-to-face visits from a nurse and fails to account for the extensive clinical and administrative services that are provided remotely by home infusion clinicians. As a result, provider participation in Medicare’s home infusion benefit has dropped sharply and beneficiaries have experienced reduced access to home infusion over the last several years.

The Preserving Patient Access to Home Infusion Act provides technical clarifications that will remove the physical presence requirement, ensuring payment regardless of whether a health care professional is present in the patient’s home. The legislation also acknowledges the full scope of professional services provided in home infusion — including essential pharmacist services — into the reimbursement structure.”

Lanton Law is a national boutique law and lobbying firm that focuses on healthcare/life sciences and technology. We have lobbied for and consult home infusion stakeholders.

If you are either thinking about getting into or are a current home infusion stakeholder and are unsure how your business model fares, contact Lanton Law so that we can go over your business model, assess potential risks and help you plan for both pending legislative and regulatory actions.

Amazon Launches U.S. Pharmacy Business

Many supply chain stakeholders have been fearing whether Amazon would ever open a retail pharmacy business. There have been traces of this occurring for years from its sporadic applications of pharmacy licenses in various states, to its June 2018 $753 million acquisition of PillPak. However; no coherent plan had come into focus until now. 

Today (November 17) Amazon has launched Amazon Pharmacy. According to the press release: 

“ Amazon.com, Inc. (NASDAQ: AMZN) today announced two new pharmacy offerings to help customers conveniently purchase their prescription medications. Amazon Pharmacy, a new store on Amazon, allows customers to complete an entire pharmacy transaction on their desktop or mobile device through the Amazon App. Using a secure pharmacy profile, customers can add their insurance information, manage prescriptions, and choose payment options before checking out. Prime members receive unlimited, free two-day delivery on orders from Amazon Pharmacy included with their membership. 

Also new today, Prime members can access savings on medications at Amazon Pharmacy when paying without insurance, as well as at over 50,000 other participating pharmacies nationwide. The Amazon Prime prescription savings benefit saves members up to 80% off generic and 40% off brand name medications when paying without insurance. Prime members will have access to their prescription savings at checkout on Amazon Pharmacy, or can learn more at amazon.com/primerx.

Together the Amazon Prime prescription savings benefit and Amazon Pharmacymake it simple for customers to compare prices and purchase medications for home delivery, all in one place. Now, filling prescriptions is as convenient as any other purchase on Amazon’s online store:

• Research Medications and Order Confidently: The same browsing experience customers are familiar with from Amazon makes it easy to discover what medications – including branded and generic versions, and different forms or dosages – are available through Amazon Pharmacy. Before checking out customers can compare their insurance co-pay, the price without insurance, or the available savings with the new Prime prescription savings benefit to choose their lowest price option.

• Seamless Transactions: Customers can add insurance information and ask their prescriber to send new or existing prescriptions directly to Amazon Pharmacy for fulfilment. Purchase is as simple as confirming the request on the Amazon App or website.

• Access Fully Digital, Personalized Quality Care: Customers have online self-service help options combined with phone access to customer care at any time. Friendly and knowledgeable pharmacists are available 24/7 to answer questions about medications.”

Notwithstanding today’s market moving news, we fully expect that our healthcare supply chain will continue to evolve. New players are moving into the sector and are looking for ways to either disrupt the model or have significant influence on reimbursement. To succeed you need to be in the know and planning ahead. 

Lanton Law is a national boutique law and government affairs firm that closely monitors legislative, regulatory and legal developments in the LTC, CBD/hemp, specialty and retail pharmacy space, as well as manufacturers and suppliers. If you are an industry stakeholder with questions about strategy or simply need advice, contact us today.    

Lanton Law to Attend 9/14-9/18 2020 NASP Annual Meeting & Expo Virtual Experience

Lanton Law is proud to be attending the 9/14-9/18 2020 NASP Annual Meeting & Expo Virtual Experience.

We will be giving a presentation on the role of “State & Federal Regulations in Payer Contracting” and Ron Lanton will be serving as Vice Chair of Law Day! Additionally, we will be hosting a panel titled “Interoperability of Health Records: Providing Post-Market Data and Other Valuable Information.”

We are very much looking forward to interacting with our specialty colleagues including Sheila Arquette! Register today at https://lnkd.in/eU2VXaB

The New Concerns of a Digital Workplace

We are honored to have worked with STACK for Pharmacy on a great and timely webinar titled “The New Concerns of a Digital Workplace. COVID-19 has changed the way that we work, communicate and transfer information and finances. We discuss the early trends of what we are seeing from a transitioning marketplace.

Click here to access the webinar

Upcoming Webinar with STACK and Lanton Law

STACK will be teaming up with Lanton Law to do an April 22, 2020 webinar at 1:00 PM EST titled “The New Concerns of a Digital Workplace.” Join Jonathan Ogurchak, Founder & CEO of STACK and Ron Lanton III, Esq, Principle of Lanton Law to discuss the following:

Challenges facing healthcare organizations with a rapid deployment to “work from home” environments

Considerations to ensure ongoing compliance and ensure appropriate use

Future areas for advancement related to the “new normal” organizations are likely to face

Click here to register

Lanton Law; Your Digital Lawyer & Lobbying Team

As organizational needs evolve right now, businesses are looking for innovative ways to become efficient and manage risks. 

For years our team at Lanton Law have been helping businesses around the country remotely with a variety of transactional needs. 

Legal services include but not limited to:

• Contract drafting, review and negotiation

• Due diligence in transactional matters

• Change of ownership

• Corporate governance matters

• Employment matters

• Privacy and data security 

• Leases

• Business strategy and growth objectives

• Day to day operational matters

• Litigation readiness and response

• Pre-litigation dispute resolutions such as arbitration and mediation

• Regulatory compliance 

• Acquisition due diligence/transfer of ownership

• Payor network access   

Additionally, our government affairs services include:

• Federal and state lobbying

• Strategic consulting

• Bill composition/bill check service

• Submitting regulatory comments

• Regulatory monitoring

Pharmacy Times Recaps Lanton Law's NASP Presentation on the FDA Biosimilars Action Plan

Pharmacy Times did a recap of our National Association of Specialty Pharmacy presentation on the FDA Biosimilars Action Plan, during NASP’s Annual Meeting this fall. The original story from Pharmacy Times can be found here. We have provided the article below in case you have trouble accessing the story. 

During the 2019 National Association of Specialty Pharmacy Annual Meeting and Expo, Ron Lanton III, Esq, reviewed the FDA Biosimilars Action Plan, its implications for the biosimilar marketplace, recent legislation set to influence the biosimilar pathway and drug accessibility, and the future of the biosimilar market.

Lanton began his presentation referencing the Biologics Price Competition and Innovation Act, which was enacted with the intent to balance innovation and consumer interest via an abbreviated approval pathway for biologic drugs that are biosimilar to or interchangeable with FDA-approved medications.

The FDA has since made substantial progress toward the scientific and regulatory policies needed to facilitate the abbreviated pathway. It established the Therapeutic Biologics and Biosimilars Staff under the Center for Drug Evaluation and Research, which supports consistent review of policy development for all biosimilars and interchangeable products, Lanton said. The agency also created the Biosimilar Product Development Program to facilitate the rapid development of biosimilar and interchangeable products. Finally, it has prioritized efforts to share regulatory information of stakeholders by publishing policies and documents on exclusivity.

Lanton noted the FDA Biosimilars Action Plan was released to allow the federal agency to manage the review and licensure pathway to facilitate biosimilar legislation; modernize policies that govern the development of biosimilars to make the process more efficient; educate clinicians, payers, and patients regarding biosimilar products and the rigorous evaluations that they go through; and modernize regulatory policies to accommodate new scientific tools that enable comparison between biosimilars and reference products, which may reduce the need for clinical studies.

The Biosimilars Action Plan also calls for the development of an application review templated for 351(k) biological licensing indications, improving coordination and supporting activities in the biosimilar/interchangeable process, accelerating the response time to determine the appropriate stakeholders, and increasing stakeholder communication, Lanton said.

The FDA said these actions and the revised guidelines are meant to prevent companies from blocking new biosimilars from entering the market and to stop manufacturers of reference products from manipulating the exclusivity provision to fend off biosimilar entry to the marketplace.

According to Lanton, the FDA is also going to issue a notice of how, if requested, it would go about trial protocols of applicants to determine whether its new protocols give enough safety protections for biosimilars in term of strategy. In May 2019, the FDA released a document seeking to promote competition in the biologic development market by providing final guidelines for interchangeable biologics.

“The FDA is updating guidelines now to provide additional clarity to biosimilar applicants who seek approval for all conditions for use for which the reference product is licensed,” Lanton said during the presentation. “The agency is also developing a proposed rule on the interpretation of the definition of [biological product], which will provide additional clarity and predictability.” Lanton referenced the following Congressional bills in his presentation:

• The Creating and Restoring Equal Access to Equivalent Samples Act, still under consideration, seeks to speed the entry of lower-priced drugs into the market.

• The Biologic Patent Transparency Act codifies the FDA’s Purple Book as a single searchable list and requires additional information to be published in it.

• The Affordable Prescriptions for Patients Through Improvements to Patent Litigation Act of 2019 limits to 20 patents that can be claimed for a reference product sponsor and tries to stop the “patent thicket.”

• The Prescription Drug Pricing Reduction Act of 2019 has the sole purpose of lowering drug prices. It wants to require that prescription biosimilar and biologic manufacturers that don’t have a Medicaid drug rebate agreement to report average sale price information to the Health and Human Services Secretary, who will use that informmation to establish the payment rates.

“Given the relative newness of biosimilars, the FDA is taking a proactive role toward giving clinicians, patients, and payers information about biosimilars and interchangeable products,” Lanton said. “They are doing this by developing educational materials and videos, explaining the concepts that the agency can use. The FDA will continue to evaluate if these firms are using statutory or regulatory requirements to appropriately delay the approval of a biosimilar or interchangeable companion.”

In referencing the future of biosimilars, Lanton stated that by 2020, there will be 56 new products in clinical development and as much as $110 billion in savings to health systems in Europe and the United States. Furthermore, there will be a 30% reduction in price per treatment day compared with originator biologics.
 

Conflicting CBD Activity Calls for Increased Compliance and Business Planning

Lanton Law gave a December 2019 webinar with the American College of Apothecaries ACA on CBD. Since then we have seen two significant developments. 

The first was with the U.S. Food and Drug Administration (FDA) itself. In November 2019, the industry saw the agency’s announcement of 15 warning letters it sent to companies for illegally selling products containing CBD in “ways that violate the Federal Food, Drug, and Cosmetic Act (FD&C Act).

The FDA shortly afterwards issued a revised Consumer Update detailing safety concerns about CBD products more broadly. In the document titled “What You Need to Know (And What We’re Working to Find Out) About Products Containing Cannabis or Cannabis-derived Compounds, Including CBD,” FDA indicated that “Based on the lack of scientific information..., it cannot conclude that CBD is generally recognized as safe (GRAS) among qualified experts for its use in human or animal food.” 

With the industry already facing several compliance questions, this new information from FDA has definitely made this issue even more confusing. 

States on the other hand have been pressing forward with making their own policies. In New York, Governor Cuomo signed (S.6184/A.7680) which establishes a regulatory framework for the production and sale of hemp and hemp extract in New York State. 

According to the Governor’s press release “The measure also requires the hemp industry to test and label their products, protecting consumers from potential harm. The legislation was signed pursuant to a chapter agreement, which provided for a more streamlined regulatory pathway for hemp products, granted the Department of Agriculture and Markets supervision over hemp growers and the Department of Health supervision over hemp extract; created a registration requirement for sellers of hemp extract products; made conforming regulatory changes to the 2018 Farm Bill; and defers decision making on hemp extracts, including CBD, as additives for food and beverages.” 

The state will host a hemp summit in January to continue policy discussions on this issue.

With the collective market for CBD sales expected to exceed $20 billion in the United States by 2024, according to BDS Analytics and Arcview Market Research, there are many stakeholders who would benefit from clarity in this area. If you are either thinking about or are currently selling CBD and are unsure how your business model fares, contact Lanton Law so that we can go over your business model, assess potential risks and help you plan for both pending legislative and regulatory actions.  

Texas v. United States (An ACA Ruling)

Lanton Law has been both monitoring and advising clients on a controversial case winding through the federal courts called Texas v. United States, which focused on the constitutionality of the Affordable Care Act (ACA). 

On December 18, 2019 the industry witnessed the U.S. Court of Appeals for the 5th Circuit issue its ruling, which found that while the individual mandate is unconstitutional, the federal district court must decide on whether the remaining portion of the ACA could remain intact. The previous federal district court ruled that the ACA’s individual mandate is no longer considered a tax, meaning that Congress does not have a constitutional authority to enforce the individual mandate. Ultimately the district court stated that since the mandate was not a severable provision from the rest of the ACA, the remainder of the ACA was thus unconstitutional.      

In contrast, the U.S. Court of Appeals for the 5th Circuit reasoned:     

“First, there is a live case or controversy because the intervenor-defendant states have standing to appeal and, even if they did not, there remains a live case or controversy between the plaintiffs and the federal defendants. Second, the plaintiffs have Article III standing to bring this challenge to the ACA; the individual mandate injures both the individual plaintiffs, by requiring them to buy insurance that they do not want, and the state plaintiffs, by increasing their costs of complying with the reporting requirements that accompany the individual mandate. Third, the individual mandate is unconstitutional because it can no longer be read as a tax, and there is no other constitutional provision that justifies this exercise of congressional power. Fourth, on the severability question, we remand to the district court to provide additional analysis of the provisions of the ACA as they currently exist.”

 So what happens next?

First the status quo remains for now as the individual mandate has been repealed by Congress. And while it is anticipated that the U.S. Supreme Court will have a say again on this issue in 2020, the defendants in this case comprised of a coalition of Democratic state attorneys general are considering asking the Supreme Court to examine the ACA for a third time since 2012. The question is whether the U.S. Supreme Court would issue any decision before the lower federal courts have completed their review of the case. Whether the Court grants an expedited review is currently unknown. 

If you have additional questions about this issue or you are trying to comprehend how this case will impact you as a stakeholder, contact us by clicking here. 

What Will Happen to Biosimilars in the USMCA Agreement in 2020?

Back in August I started an analysis of how biosimilars will be impacted in the new United States-Mexico-Canada Agreement (USMCA). To refresh, in a follow up on a 2016 campaign promise to renegotiate the North American Free Trade Agreement (NAFTA), the Administration has been engaging Mexico and Canada in an effort to create and ratify the USMCA. 

One of the major points of contention in the negotiation centered on the exclusivity period of biologics. Biosimilar manufacturers raised concerns about the fact that the USMCA would award biologic manufacturers 10 years of market exclusivity. 

Fast forward to December 19, 2019 when the U.S. House of Representatives approved the USMCA with a bipartisan vote of 385-41. When it comes to biologics, the status quo remains as the exclusivity period continues to be 12 years. A provision that would have guaranteed 10 years of market exclusivity for biologic drugs was stripped out of a deal between Congress and the Administration. 

Senate Majority Leader McConnell (R-KY) stated that the U.S. Senate would consider the measure in early 2020. The reason for the delay according to the Senator is due to the looming impeachment trial for President Trump. Stay tuned for developments.

If your organization intends to either start or increase your utilization of biologic/biosimilar products or you are interested in understanding how to invest in these emerging products, contact us today. 

New Draft Importation Rule Released

A new pilot program that allows states to import from Canada and allow manufacturers to voluntarily import has been announced via a draft rule through HHS and the FDA. 

The program would give states and nonfederal government entities the ability to import from Canada by applying to the FDA. Higher priced drugs such as biologics are not included in the draft rule. Here are some of the main points: 

• The drugs must be approved in Canada. 

• It does not include, controls, biologics or intravenously injected drugs. 

• States can work with wholesalers and pharmacies to create an application.

Canadian officials have already stated that the plan is unlikely to work as Canada is only 2% of the global market versus 44% from the U.S. This means that Canada will not be able to meet demand. 

A separate program that would allow for drug company importation of its own products does not take into account rebates or the best-price rule. The program requires that the drugs go through a separate re-labeling and testing that will have an additional cost. Additional costs may either cancel out any savings or make the drugs more expensive. 

This rule is in response to several states such as Florida who have created legislation in 2019 to allow for the importation of drugs from Canada. 

For more information regarding importation in general click here. 

Here is a link to the proposed rule. 

At Lanton Law we help our clients with business strategy, legal, compliance, as well as regulatory and government affairs issues. We help various entities within the supply chain be prepared for tomorrow by knowing the landscape of today. If you have questions or are looking for innovative ways to realize your organization’s priorities, click here to contact us. 

U.S. Solicitor General Advocates for writ of certiorari to be granted in Rutledge v. PCMA

One case that pharmacy stakeholders have been closely monitoring is  Rutledge v. Pharmaceutical Care Management Association. 

According to the U.S. Supreme Court blog (SCOTUSblog), the issue in this case is “whether the U.S. Court of Appeals for the 8th Circuit erred in holding that Arkansas’ statute regulating pharmacy benefit managers’ drug-reimbursement rates, which is similar to laws enacted by a substantial majority of states, is pre-empted by the Employee Retirement Income Security Act of 1974, in contravention of the Supreme Court’s precedent that ERISA does not pre-empt rate regulation.”   

As part of his response to the Court’s “CVSG” or “Call for the Views of the Solicitor General” to provide a position on an issue such as this, U.S. Solicitor General Noel Francisco on December 4, 2019 submitted his brief recommending that the Court review the Eighth Circuit’s holding that ERISA preempts state laws that regulate PBM-pharmacy reimbursements. The Solicitor General’s position advocates for the overturning of the appeals court decision. The brief can be read here.  Having this letter from Solicitor General can help push the Court into granting cert to hear the merits of this case. 

Lanton Law uses law and government affairs to advocate on behalf of supply chain clients, which includes retail, specialty, LTC pharmacies as well as home infusion providers. All of these providers have ties to PBM business practices via reimbursement. Lanton Law will continue to monitor the developments of Rutledge v. PCMA and will advise our clients accordingly. If you have an issue that we can assist you with such as us being your in house counsel or lobbyist, contact us and we’ll be happy to walk through your options.   

Not knowing what’s in your contracts can stop your business expansion

No matter if you are a hospital, physician, pharmacist, manufacturer, SAAS or Health IT provider, the lifeblood of your business is in your contracts. As an attorney what amazes me time after time is how contracts are often overlooked by businesses.

When I speak with clients, many of them tell me that either they will just sign a contract to get access to something or on the back side, they will simply plan to get out of a contract if they aren’t happy with the party they contracted with. Situations like this are when things get interesting.

For clients contemplating entering into a contract, I usually ask the following: 

• Were you were able to negotiate your priorities into the contract? 

• Are you using standard terms and conditions from prior agreements?

• Are you thinking about how your business may evolve over time? 

On the flip side for clients that plan on exiting a contract I ask:

• Do you know what happens if you plan to get out of the contract? 

• Are there penalties for terminating?

• Are you prohibited from re-entering a certain market?

Many businesses don’t know the answers to these questions. Not knowing your rights before making a decision to either enter or exit a contract can cost your business thousands of dollars. 

Fortunately, there is something you can do about this. Clients have been using Lanton Law to help them understand not only what’s in their contracts, but Lanton Law gives you suggestions on how to negotiate a better deal, while also giving you a risk assessment for clients considering leaving a contractual relationship. Having a contract strategy will definitely save you from making a costly decision. 

Click here to contact Lanton Law now to schedule a contract risk assessment. Taking this small proactive step will not only help protect your interests, but it will allow you to more confidently plan for your future business expansion.

Lanton Law Quoted in New Medscape Article On Biosimilar Insulin

Lanton Law was quoted in a new Medscape article on biosimilar insulin. Click here to read the article

If you are having trouble accessing the link we have included the article for you below:

A new US Food and Drug Administration (FDA) policy may help get novel biosimilar insulins to market more quickly, but it will be no guarantee that the products will be significantly less expensive than branded insulins, say analysts.

The FDA recently issued new draft guidance for insulin biosimilar manufacturers.

The recommendations "may result in a more efficient development program that could ultimately bring biosimilar or interchangeable insulin products to the market more quickly," said Brett P. Giroir, MD, acting FDA commissioner, in a statement by the agency. 

"The availability of approved biosimilar and interchangeable insulin products is expected to increase access and reduce costs of insulin products," he added.

Meanwhile, the Republican leaders of the US House Energy and Commerce Committee have written to the nation's largest insurers to demand that they provide information on their involvement in the rising price of insulin.

The committee wrote to Anthem, Blue Cross Blue Shield, CVS Health, Cigna Corporation, Kaiser Permanente, and UnitedHealth Group seeking transparency on rebate programs with pharmacy benefit managers (PBMs); detailed information on how they design their benefit plans and formularies; how much enrollees in high-deductible plans pay out of pocket for insulin; and whether the insurers offer patient assistance programs to help defray the cost of insulin.

"Unfortunately, even though the average net price that manufacturers are receiving for many insulin products is decreasing and PBMs are working with health plans to help reduce the cost of insulin for health plans, many Americans are facing increased out-of-pocket costs for their insulin at the pharmacy counter," the members of Congress wrote.

"Floodgates Opening": Clearer Path to Market for Biosimilar Insulins 

Analysts and one industry group applauded the FDA draft guidance, stating that it gives a much clearer picture of how products can be developed and approved.

The new guidance — which will be made final once the agency takes public comments into account — has been expected for some time. The FDA issued final guidance on interchangeability of biosimilars in May and held a public hearing specifically on interchangeability of insulin biosimilars not long after.

The Association for Accessible Medicines (AAM) said it was continuing to review the draft guidance but believes it reflects much of the concerns and feedback it gave the agency at the May hearing.

"We find FDA's flexibility on the implementation of statutory interchangeability requirements to be particularly positive," Christine Simmon, AAM senior vice president for policy and executive director of the Biosimilars Council told Medscape Medical News.

"This really was the floodgates opening," said Ron Lanton, III, a Washington, DC-based attorney who studies regulatory policy and has represented primarily small pharmacy chains.

"The United States is not an easy place for doing business when you're talking about biosimilars," he told Medscape Medical News.

The FDA has approved 26 biosimilars, including two insulins which, to date, have been labeled "follow-ons", Basaglar (insulin glargine, Lilly) and Admelog(insulin lispro, Sanofi), as they were brought to market under a different regulatory pathway, but are considered to be copycat or biosimilar versions of the respective branded insulin products.

The guidance "is one step forward for manufacturers" to say, "now that we know what the rules are, we can start to compete," said Lanton.

He believes the draft guidance, if ultimately adopted, will get biosimilars to market faster.

Dave Clissold, a food and drug lawyer with Washington, DC-based Hyman Phelps McNamara, which has represented biosimilar and branded insulin manufactures, also believes the policy will speed up new product development.

Also important, said Clissold, is the FDA's decision that manufacturers won't necessarily have to conduct studies that compare immunogenicity to the reference product.

That goes further than what had been expected but will be welcomed by biosimilar makers, Clissold told Medscape Medical News.

The FDA is communicating that "insulins are special biologics. They're small, they're not very complicated, we know a lot about them. There are all different types of insulins on the market right now, so we've got a ton of clinical experience with these things," he added.

Skipping those comparative studies won't be automatic, he said.

"But there is a path forward" that manufacturers can take to justify why they think they don't need to conduct what are usually costly and long studies, he explained.

Price Still a Question Mark

Clissold continued by noting that the FDA cannot dictate pricing, but ideally, "more competition will drive prices down."

"We've certainly seen that for the big blockbuster generic drugs," he said.

Lanton said that although the agency is attempting to harness competition to lower prices, that's not a given in the US market.

"We really don't know what the pharmacy benefit managers are going to do," he said.

Lanton pointed out the lack of transparency in the rebate scheme between PBMs and drug makers.

"What's going to prevent an innovator from coming in, talking to a PBM, and giving a steeper discount?" he said.

"Even if the price is lower, with the rebate still not being addressed, is that going to have an effect on anything?" Lanton wondered.

CMS Star Ratings: Will Biosimilars Benefit?

This article is in Biosimilar Development: Click here to read the article

In case you can’t access the article, here is the text below.

The Centers for Medicare and Medicaid Services (CMS) star ratings system was created in 2007 for insurance plans operating under both the Medicare Advantage and Part D. This 1 to 5 system (with 5 being the highest rating) is a way for CMS to measure the value of a plan and determine whether to continue to allow it to be part of the program. However, it’s more than just the plan, since the plan’s providers play a key role in how CMS evaluates each plan.

Essentially, the system measures other items as well, such as clinical quality, beneficiary satisfaction, and regulatory compliance, in addition to included providers. Plans are incentivized with financial rewards for improving quality performance and achieving the highest rating. What has been interesting to watch over time is how the star ratings system has become the go to evaluator for anything healthcare. The question is whether this concept could be applied to reduce drug costs, specifically, where biosimilars are concerned. 

We received our answer with the introduction of the Star Ratings for Biosimilars Act, otherwise known as H.R. 4629. This bipartisan bill is sponsored by Congressmen Tonko (D-NY) and Gibbs (R-OH), but to date it hasn’t gotten much support. The bill has a U.S. Senate version sponsored by Senators Cassidy (R-LA) and Menendez (D-NJ). According to Senator Cassidy’s press release, “This bill would incentivize insurers to use lower cost versions of drugs by rating the plan based on usage of biosimilar medications. Using lower cost drugs will lead to positive health outcomes with lower out of pocket costs for patients.” We have also seen similar legislative language in S.2543, known as the Prescription Drug Pricing Reduction Act of 2019.

For years now, we have witnessed several debates on how biosimilars could potentially lower drug costs, and this proposed legislation is another example of the potential promise that biosimilars have in helping policymakers lower drug costs. But will this bill help? Specifically, the proposed legislation calls for determining whether a biosimilar is on the formulary, assesses whether and how utilization management tools are applied with respect to a biosimilar, and assesses the percentage of enrollees prescribed the biosimilar biological product when the reference biological product is also available.

While I applaud any idea that attempts to lower costs and promote patient access, the devil is always in the details. For example, will these proposed metrics of incentivizing plans to use biosimilars work? Will there be competing metrics that plans have that may be better measurements than CMS?

Industry stakeholders like physicians and pharmacists may not like having plans with too much autonomy because unfairness and bias in measuring provider compliance may come into play, as plans and their partner pharmacy benefit managers (PBMs) would likely favor their providers and pharmacies, which could result in different star ratings for some. Will hospitals be amenable to this system when they already have complaints against CMS’ star ratings programs due to hospitals not being able to predict quality improvement metrics for operational efficiency? Physician education on biosimilars will have to be increased as well, since their comfort level with biosimilars will help spawn more utilization by their patients. Lastly, what impact will star ratings on biosimilars have on insurer rebates? At this time, it is too early to tell, since without this clarity it is even hard to quantify if biosimilars are already experiencing formulary disadvantages due to innovators offering larger discounts. One thing is for certain, in order to force monumental change, it may be best to do it via mandate. Forced compliance, in my opinion, will bring out the potential bugs in a system fast.

Ultimately, the other big issue is whether there is enough time to get legislation like this through Congress, along with a presidential signature. It would also help if the bill had more support, through either Congressional members or a push from powerful interested stakeholders. To date, the bill doesn’t have a significant number of cosponsors. It could be that it is December or that lowering drug prices through biosimilars is an idea that is spread throughout too many current Congressional proposed bills.

Theoretically, this seems like a win-win for both parties, but, realistically, we are on the doorstep of campaign season. With the upcoming elections on the state and federal level expected to be explosive, will lawmakers find the will to agree on a bipartisan solution like this before the political rhetoric heats up? We can only hope.  

Lanton Law December 2019 Newsletter Now Available

We are out with our December 2019 newsletter. This edition covers data oversight, a Medicaid white paper and upcoming webinars. Click here to access the December 2019 newsletter.

Additionally, if you are interested in signing up for our newsletter that has trending information on healthcare, technology and fintech, click here to sign up.  

Lanton Law's Webinar With WellSky Now Available

Our recently recorded webinar with WellSky titled “What home care policies to watch for the rest of 2019” is now available at https://info.wellsky.com/LP-Emerging-SPRX-and-IV-Policies.html Below is a description of the webinar:

Unlike anything we have experienced before, the backend of the legislative calendar year is proving to be louder than ever. While Capitol Hill is embroiled in contentious topics, issues that are more important to home infusion and specialty pharmacy industries are impacted, and slowly working their way through the system. The webinar discussed the following:

DIR and possible policy solutions

• Latest drug price and how these will impact specialty and home infusion stakeholders

• Patient co-payments and biosimilars

• The Home Health Payment Rule

The Challenges to Launching Biosimilars

Check out Ron Lanton’s interview with Specialty Pharmacy Times on “The Challenges to Launching Biosimilars” https://www.pharmacytimes.com/news/challenges-to-launching-biosimilars

Below we have provided the text from the interview as well:

Ron Lanton III, Esq.: Well, there are a few challenges to launching biosimilars after approved. One I can think of is litigation. So there’s been constant litigation between the biologic and the biosimilar to make sure that there is some kind of market exclusivity. So that’s the first thing. The second thing is that the biosimilars are actually fighting the patent thicket, so the biologic or innovator product is throwing up a lot of patents to keep the biosimilar off of the market, so you’re having a fight about that. I think education—so physicians, patients, they’re not really knowing too much about biosimilars and what some of these biological products are and kind of use them interchangeably because they don’t know about either/or. So I think a little bit more education is key, and I know that the FDA has been trying to put out a lot of policies recently to get more utilization out of this to drive down the cost of medication.