The recent ACCESS Europe 2023 Annual Meeting held in Budapest drew significant attention to the Inflation Reduction Act (IRA) from a global perspective. The conference brought together a highly engaged international audience, including professionals from various fields such as access, evidence, healthcare policy, and academia. The dynamic discussions revolved around the potential impacts, unintended consequences, and stakeholder viewpoints related to the IRA. The relevance of the IRA outside of the US was underscored by a unanimous show of hands regarding its frequency of discussion in stakeholder meetings. This strong start set the stage for a comprehensive panel discussion featuring perspectives from healthcare policymakers, payers, economists, and pharmaceutical manufacturers, addressing concerns and considerations surrounding the IRA’s implications.
This article summarizes the discussion held during the ACCESS Europe 2023 meeting and the conference plenary, US Inflation Reduction Act (IRA): What Keeps You Awake at Night?
Policy Perspective
The current political climate emphasizes the strong commitment of President Biden’s administration to tackle drug prices and improve access for Medicare beneficiaries. The political undercurrent is substantial. The main objective of policy implementation is to establish durable and resilient policies that can withstand changes in political leadership, regardless of which party is in the majority. The Centers for Medicare and Medicaid Services (CMS) has extensive experience in conducting detailed analyses with complex evidence packages, which shows a desire to develop a thoughtful and enduring approach to implementing the law. These efforts highlight the administration’s dedication to addressing the critical issues surrounding drug pricing and access within the healthcare system.
Payer Perspective
The Maximum Fair Price (MFP) negotiations and the redesign of Medicare Part D are two issues that are top of mind for the payer community. Special attention is being applied to the changes in Part D, such as the increased financial liability during the catastrophic phase and the challenge of managing it without traditional tools like premium hikes to offset the financial impact. There are concerns about the practical implementation of various elements of the redesign, such as the need for more scalable systems and processes to help patients who choose to distribute their $2,000 out-of-pocket maximum expenses equally, known as “smoothing,” in 2025. As these changes take effect, the relationship between medical and pharmacy benefit management will play a crucial role in shaping the future of healthcare coverage and access.
Economist Perspective
At the moment, there is significant uncertainty around determining the MFP and the drug price negotiation process, creating a complex situation for the future of drug commercialization. This is particularly true when it comes to small molecules and biologics, which are treated differently in terms of timing for eligibility in the negotiation process. A long-term effect may result in lower returns for emerging products. In addition, when launching a product, the order of indications matters, and multi-indication products may face a disadvantage. The impact of these changes on public health is a pressing concern, as there may be a decrease in the number of products that make it to the market due to evolving regulations, making it more difficult to develop and commercialize new products.
Pharmaceutical Manufacturer
CMS has communicated its stance to ensure that patients will have reasonable access to selected MFP products. However, the existing statute, while mandating drug coverage, does not explicitly require the implementation of reasonable measures to prevent selected MFP drugs from having onerous cost-sharing or disadvantages when compared with non-MFP drugs that are used to treat the same medical conditions. As the implementation of MFP approaches, a paramount question emerges: will patients be able to access the selected drugs, and what will be the implications of this regulatory shift on affordability? Time will tell.
Thoughts for the Future
As we navigate the strategic decisions surrounding our product and pipeline, we face pivotal questions in the ever-changing landscape shaped by the IRA. It is crucial to consider how we can ‘future-proof’ portfolios through evidence generation and strategic decision-making. While we monitor the negotiation process with these first 10 products, manufacturers should be analyzing which types of evidence and studies are the most compelling during the CMS evaluation. We should also consider how the international arena can be a valuable source for clinical and post-market evidence generation. As global markets become increasingly significant, it is essential to align portfolio strategies to achieve international success.
The price negotiation process dominated the question-and-answer portion of the plenary discussion. The Part D redesign perhaps did not resonate as much due to unfamiliarity with the practical operation of the Medicare program and pharmacy benefit.
The ACCESS Europe 2023 conference provided a platform for a comprehensive discussion on the IRA from a global perspective. The engagement of a diverse audience across various healthcare fields highlighted the importance of this US-centric policy on the international stage.
As the IRA continues to shape the healthcare landscape, these multifaceted considerations will play an important role in shaping the strategic direction of future products, pipeline decision-making, and patient access.
