Technological and scientific advancements have dramatically altered the treatment landscape in several disease states. These include orphan diseases and conditions that previously had no disease-modifying treatment options. These innovative therapies have also come with unprecedented costs, with some agents introduced at a price exceeding one million dollars for a single patient. Value-based purchasing arrangements (VBPs) have attempted to manage the initial cost of these agents. In a VBP, which is sometimes referred to as an outcome-based arrangement, the ultimate price that is paid for the drug is dependent on the clinical outcome. In addition to a plan’s traditional utilization management initiatives to maintain sustainability, this strategy aims to hold pharmaceutical manufacturers responsible for the result of their product. This is similar to other healthcare environments, such as when readmissions impact hospital reimbursement. Under VBPs, a pharmaceutical manufacturer would issue a reimbursement if their product failed to produce the desired clinical outcome. In addition, this strategy incentivizes the development of unique therapies that are more likely to have a clinically significant impact. Novel medications that improve outcomes would provide a greater healthcare value and could be priced higher in the market. Currently, volume is a large driver of cost, with discounts from pharmaceutical manufacturers often tied to the number of units dispensed. This is less helpful for niche-area pharmaceuticals and genuinely innovative treatments used for uncommon conditions.

Practical considerations of VBPs, such as a higher administrative burden (e.g., paperwork, electronic database access, automated retrieval of data), limit their application to all products. Since it can be expensive to measure outcomes in order to assess the worth of a product to an individual patient or plan, VBP concepts are most commonly applied only to the costliest medications. For instance, VBPs can have a significant impact on the pricing of agents like gene therapy or select oncology agents. Some of these agents can have a large clinical impact on disease progression, survival, or quality of life, but a drug may not have the same results in all patients. However, value-based or outcome-based pricing may provide an increased incentive to payers by decreasing their initial risk and providing more sustainable treatment coverage.

While there has been an increase in the use of VBPs by states, manufacturers, and other payers in order to control drug spending and tie patient outcomes to cost, uncertainty remains in developing novel VBPs. The Medicaid Drug Rebate Program (MDRP) created by Congress under the Omnibus Budget Reconciliation Act of 1990 ensures that Medicaid receives the lowest net price for a single source drug or innovator multiple source drug during the rebate period charged to any payer. Simply put, pricing net of all discounts, must be reported to Medicaid, and the best price would have to be offered to Medicaid as well. It is critical that Medicaid programs continue to receive the lowest price available for a single source drug or innovator multiple source drug.

On June 19, 2020, the Centers for Medicare & Medicaid Services (CMS) issued a proposed rule that is aimed at promoting VBP flexibility for a variety of payers, including Medicaid, with a goal of maintaining a best price for Medicaid. CMS notes that best price creates challenges related to the availability of VBP arrangements. For example, under existing best price rules, if an individual fails to achieve the specified clinical outcome under the VBP arrangement, the drug manufacturer may be required to provide a discount or otherwise may not be entitled to payment for that patient. Thus, the best price of that drug for purposes of the MDRP could become zero. This possibility has stunted the development and proliferation of VBPs. This new proposal from CMS, which includes other regulatory revisions as well (e.g., minimum standards for Drug Utilization Review [DUR] programs), could ultimately lower healthcare costs and potentially limit spending on treatments with limited value over time.

The ultimate goal of a VBP is for all parties to have a vested interest in the outcomes of drug therapy and to share the risk related to healthcare costs. Specifically, it calls on manufacturers to have more “skin in the game.” Moreover, the change to the Medicaid market could have potential savings applicable to a variety of market segments, impacting all Americans. Regardless of the final outcome or any changes made to the current draft prior to its possible rollout, the proposal demonstrates readiness from CMS to pivot prior strategies to mitigate rising drug prices.

In January 2020, the United States (US) Food and Drug Administration’s (FDA) Center for Drug Evaluation and Research (CDER) published Advancing Health through Innovation: New Drug Therapy Approvals 2019. This report provides a summary of a number of approvals and highlights the “game-changers” approved in 2019, solidifying the upward trend in approval volume initially seen in 2017. Compared to 2017 and 2018, in which CDER approved 46 and 59 new drugs, respectively, 48 novel agents were approved in 2019. This number does not include new and expanded uses of already approved drugs, new formulations, new dosage forms, vaccines, blood products, cellular or gene therapy, or the 10 biosimilar approvals. This far exceeds the average of 38 novel approvals per year in the past 10 years. Figure 1 outlines approvals over the past 10 years.

In 2019, the FDA continued its strategic initiatives, with additional approvals of biosimilars and generics (both first-time agents and those off-patent with limited competition), as well as a focus on the expedited approval process, particularly for rare diseases and agents supported by positive patient-reported outcomes. Notably, the FDA hosted a public meeting in April 2019 to receive input on how to tackle barriers associated with the development of treatments for rare diseases, and held another meeting to celebrate “Rare Disease Day” in February 2020. Moreover, this trend is likely to continue, with the FDA releasing several guidances on gene therapy. The new pathway for insulin approval under biologic license applications planned for March 2020 and the launch of internet-based repositories or apps to improve access to information for both providers and patients (e.g., CURE ID in 2019, antiretrovirals in 2020) also highlight strategic initiatives of the FDA.

Last year, all 48 novel drug approvals met their Prescription Drug User Fee Act (PDUFA) goal dates, cementing this as a priority for the Agency. In 2019, 42% were considered first-in-class, and 44% were approved for rare diseases (Orphan Drugs). Priority Review was granted to 58% of novel drugs, 19% received Accelerated Approval (more than doubling the rate of 7% last year), 27% were designated as Breakthrough Therapy, and 35% garnered Fast Track designation. Overall, 60% of all drug approvals in 2019 used expedited development and review methods. In addition, 90% were approved in the first review cycle, and 69% were approved in the US prior to receiving approval in other countries. A breakdown of the types of drugs approved in 2019 is illustrated in Figure 2, with approvals once again dominated by drugs in the expansive oncology spectrum.

Some of the notable 2019 approvals included new advances for the treatment of cystic fibrosis (CF), with the first triple combination therapy and expanded indications of existing CF therapy available to younger patients, and the first new medications in several years for sickle cell disease. Additionally, several approvals targeted rare conditions, such as erythropoietic protoporphyria, neuromyelitis optica spectrum disorder, tenosynovial giant cell tumor, Duchenne muscular dystrophy, and systemic sclerosis-associated interstitial lung disease. Beyond treatments for rare disease and cancer, the FDA also approved agents for more common disorders, including multiple sclerosis, novel treatments for depression, migraine and cluster headaches, epilepsy, several autoimmune conditions, age expansions for diabetes therapy, and a drug-sparing regimen and new prophylaxis option for human immunodeficiency virus-1 (HIV-1). Although down slightly from 2018, the large number of approvals from 2019 represent a continued trend by the FDA to expedite and increase the quantity of annual approvals.

While there have been significant drug shortages in the past as a result of unforeseen circumstances, such as Hurricane Maria’s effect on Puerto Rico’s drug manufacturing facilities in 2017, drug shortages often crop up and continue despite no obvious reason. The ongoing shortage of vincristine, an older, traditional chemotherapy agent used for several cancers, has compelled tough decisions by providers and families. In some cases, there are few other treatment options for patients or the treatment regimen is incomplete without vincristine. Other shortages, including those for heparin, critical antimicrobials, and immunoglobulin, have also made national news. The United States (US) Food and Drug Administration (FDA) monitors and reports drug shortages and has historically worked with manufacturers and public health partners to mitigate the impact of shortages. For instance, during Hurricane Maria, the FDA allowed temporary importation of certain products from select manufacturers and worked to expedite reviews of drug applications that could alleviate shortages of affected medications. According to the FDA, the biggest causes for drug shortages are quality or manufacturing issues (37%), lack of raw materials (27%), and manufacturing delays and capacity concerns (27%).

Due to the ongoing issues associated with drug shortages and prompting from a bipartisan Congressional group in June 2018, the FDA developed an interagency Drug Shortages Task Force. This group was tasked with studying shortages, determining their root causes, and developing strategies to limit the occurrence and widespread effect of drug shortages. The Task Force evaluated products that were affected by a shortage between 2013 and 2017 and solicited public and key stakeholder feedback. In late October 2019, the FDA issued a press release announcing the publication of a report from the Task Force entitled, “Drug Shortages: Root Causes and Potential Solutions.” Notably, the Task Force confirmed that drug shortages not only persist but also have continued to rise again recently since falling from their peak in 2011. As an example of their impact, the group highlighted select medications whose shortages have had a significant clinical impact (e.g., pediatric oncology medications, medications for septic shock). Of the 163 drugs in shortage they analyzed, 63% were sterile injectables and 67% were products available as a generic. The median time since first approval was nearly 35 years and most were considered relatively “cheap,” as they were several years off-patent (median price of $2.27/unit for oral drugs and $11.05 for injectables).

The Task Force identified 3 root causes associated with drug shortages: (1) lack of incentives for manufacturing less profitable drugs; (2) lack of recognition and incentives for mature quality and production management, as well as production contingency plans; and (3) logistical and regulatory hurdles that limit production responsiveness. Moreover, the Task Force proposed solutions to alleviate the impact of drug shortages. The first recommendation is to create a shared understanding of the impact of drug shortages, including quantifying costs, frequency, persistence, and intensity, as well as improving transparency of contracted price and stipulations. The group also recommends the development of a rating system to incentivize a manufacturer’s investment in maturing quality management, beyond the minimum threshold of Current Good Manufacturing Practices (CGMPs), to improve voluntary transparency. Finally, the group recommends the promotion of sustainable private sector contracts. This recommendation would involve providing incentives for manufacturers that would mitigate the financial risk of introducing or keeping products on the market, in addition to quality-based manufacturing financial incentives. The Task Force further identified legislative proposals that could limit product availability interruptions (including improved data sharing), risk assessment to identify vulnerabilities, and additional expiration date/shelf-life data. Likewise, the Task Force also stated that the FDA plans to publish guidance for the industry. These would be regarding FDA notification of permanent or temporary manufacturing of a product and risk management plans to prevent and limit shortages.

In addition, other legislation has been proposed, such as the Mitigating Emergency Drug Shortages (MEDS) Act, introduced to legislation by Senator Susan Collins (R-ME) and Senator Tina Smith (D-MN). According to Collin’s office, shortages can add approximately $230 million in drug costs and $216 million in labor costs annually in the US. Key priorities of the Act include strengthening transparency to disclose causes, expected impact, and estimated durations of shortages; extending reporting requirements to include active ingredients (not only the finished product); requiring contingency and redundancy plans for critical medications; and incentivizing manufacturing of products in shortage. Furthermore, the proposed legislation would require the Department of Health and Human Services (DHHS) and Department of Homeland Security (DHS) to conduct a risk assessment associated with shortages of critical drugs that could affect national security. So far, the MEDS Act has support from several healthcare organizations, including the American Pharmacist’s Association (APhA), American Society of Health-System Pharmacists (ASHP), American Society of Clinical Oncology (ASCO), and the American Hospital Association (AHA).

In the meantime, drug shortages continue to creep into national news. While a lack of drug accessibility is often linked to cost, drug shortages are a reminder that cost is not the only roadblock to treatment. Despite the innovation of the US healthcare system, and the novel drug and biologic discoveries that have dramatically altered care, some Americans, because of a variety of factors and causes, still find themselves scrambling to obtain routine or essential medications.

The Drug Shortages Task Force’s report may be found here: https://www.fda.gov/media/131130/download.

Nearly 2 decades after measles was declared “eliminated” in the United States (US), we find ourselves in the midst of an unprecedented measles outbreak in the modern era of vaccination. As of July 25, 2019, a total of 1,164 active cases of measles have been confirmed in 30 states. As one of the most contagious human diseases, measles can lead to serious health complications such as pneumonia, encephalitis, and even death. Given its highly contagious nature, the measles resurgence has public health officials on high alert.

Once relegated to the history archives thanks to a widely effective immunization program, measles is an acute respiratory illness spread through coughing or sneezing. The virus can linger for up to 2 hours after an infected person leaves an area. Symptoms typically begin 1 to 2 weeks after a person becomes infected. High fever, cough, runny nose, and red/watery eyes are followed after a few days by the hallmark red rash. Patients are considered contagious from 4 days before and after the rash appears. It is so contagious that following exposure, about 90% of unprotected individuals will develop measles.

According to the Centers for Disease Control and Prevention (CDC), the measles outbreak has proliferated due to factors including international travel and unvaccinated individuals. Unfortunately, measles is common in many parts of the world, and Europe is experiencing an ongoing spike, which is contributing to the measles surge in the US. In late April 2019, the CDC reported that, of the 44 “imported measles” cases that came into the US this year, 34 cases were in primarily unvaccinated US residents traveling abroad. The majority of imported measles cases in the US have been from popular travel spots such as the Philippines, Ukraine, Israel, Thailand, Vietnam, and Germany. In June 2019, the CDC issued a Level 1 Global Measles Outbreak Notice, alerting US travelers to the current situation and reminding them to check their immunizations before traveling internationally. Regardless of destination, the CDC recommends visiting their “destinations” site to view valuable traveler’s health updates to safely plan for travel.

Insufficient measles vaccination coverage, the other culprit in this outbreak, has also been fueling US circulation of the disease. The majority of measles cases in the US have been among unvaccinated individuals. CDC statistics show that there are pockets of unvaccinated close-knit communities in certain US jurisdictions, such as in parts of New York, experiencing an outbreak. Measles spreads quickly through these populations, making it difficult to limit transmission. Personal and religious beliefs, complacency, and unproven risks thought to be associated with vaccines, are among the reasons behind vaccine hesitancy and avoidance, leading to undervaccination in vulnerable communities. Moreover, unfounded concerns regarding vaccines and autism, which have been refuted by scientific evidence, have also led to skepticism in select groups.

In the pre-vaccine era, an estimated 3 to 4 million people in the US contracted measles each year, resulting in significant deaths and hospitalizations. In modern times, a vaccine is the strongest weapon to combat measles. For best protection, 2 doses of the measles, mumps, and rubella (MMR) vaccine are recommended and are approximately 97% effective at preventing measles; 1 dose is roughly 93% effective. The MMR vaccine is part of routine childhood immunizations. Measles vaccine recommendations for all age groups, as well as for international travelers, are available on the CDC website.

The CDC deems a disease “eliminated” after 12 continuous months of no active transmissions. If the current outbreak, which started in New York in October 2018, is not contained by October 2019, the US risks losing its measles elimination status. Whether traveling abroad or enjoying a summer staycation, individuals and communities should guard against the measles virus. The best protection against the “21^st century measles outbreak” is immunization. Armed with awareness, education, and appropriate vaccinations, this preventable disease can once again be banished to the history books.

Disclaimer: The content in this blog article is not a substitute for professional medical advice. For questions regarding any medical condition or if you are in need of medical advice, please contact your healthcare provider.

Two patients, both 73-year-old males with newly diagnosed congestive heart failure, are seen by the same provider and prescribed the same therapeutic regimen. Despite the similarities, the 2 patients experienced drastically different therapeutic outcomes. These divergent outcomes were not attributable to the clinical care they received but instead to non-clinical factors surrounding each patient’s circumstances. These non-clinical factors are also referred to as social determinants of health (SDOH). According to the Centers for Disease Control and Prevention (CDC) website, SDOH are conditions in the places where people live, learn, work, and play that affect a wide range of health risks and outcomes. Some key SDOH that may influence clinical outcomes include housing insecurity, food insecurity, lack of transportation, and lack of family or other social support.

It is widely known that social and economic factors have significant impacts on health outcomes of both individuals and communities. At a population level, it has been estimated that clinical care accounts for only 20% of a community’s health outcomes while the remaining 80% is related to a combination of health behaviors (e.g., diet and exercise), the physical environment (e.g., housing security), and socioeconomic factors (e.g., education and social support). Despite this insight, addressing SDOH has traditionally been the purview of government and charitable organizations rather than healthcare providers. However, with the shift toward value-based reimbursement and increased accountability for the costs and health status of patients, there is an incentive for health plans and providers to further consider the social and economic barriers that contribute to poor health outcomes. Models are being developed that link healthcare systems, providers, and community resources in an integrated fashion to address SDOH. These models are evolving from systems that rely on acute episodes of care to a coordinated system focused on prevention and care management.

As the largest payer for healthcare in the United States, Medicare has also recently begun to make accommodations in order to address SDOH in the privately administered Medicare Advantage (MA) program. MA is a capitated system placing health plans that administer MA benefits at risk for the cost of caring for each beneficiary. MA plans are permitted to offer supplemental benefits beyond traditional Medicare offerings as long as those benefits are “primarily health-related.” Historically, the most common supplemental benefits offered by MA plans have been services not traditionally covered by medical insurance such as vision exams, hearing tests, and preventative dental services.

The Centers for Medicare & Medicaid Services (CMS) have recently begun to implement regulatory changes allowing MA plans more flexibility with regard to these supplemental benefits. First, the definition of “primarily health-related” has been expanded. Examples of this expanded interpretation include providing in-home support for activities of daily living (ADLs) or installation of grab bars in the bathroom in order to prevent injuries and reduce avoidable emergency room utilization. In addition, supplemental benefits that may reduce exacerbations of existing illnesses, such as installing air conditioning units or providing carpet shampooing for patients with asthma, may be considered. Beginning in 2020, MA plans may offer chronically ill patients additional benefits that directly impact SDOH, such as expanded meal delivery options to address food insecurity and transportation for non-medical needs like grocery shopping. In announcing the expanded options for MA plans, CMS Administrator Seema Verma said the changes “give plans the ability to be innovative” and the changes permit “benefits and services that address SDOH for people with chronic disease.”

The shifts occurring in healthcare delivery, including the expansion of accountable care organizations (ACOs), the rise of capitated reimbursements, and penalties associated with hospital readmissions, incentivize healthcare systems to become increasingly focused on holistic care for beneficiaries. By addressing individual and population SDOH, healthcare systems, providers, and community support can be integrated to improve health outcomes and reduce unnecessary healthcare utilization.