Medicare Makes Big Decision on New Alzheimer's Drug

Medicare said Tuesday it will limit coverage of a $28,000-a-year Alzheimer’s drug whose benefits have been widely questioned, a major development in the nation’s tug-of-war over the fair value of new medicines that offer tantalizing possibilities but come with prohibitive prices. The initial determination from the Centers for Medicare and Medicaid Services means that for Medicare to pay, patients taking Biogen’s Aduhelm medication will have to be part of clinical trials to assess the drug’s effectiveness in slowing the progression of early-stage dementia as well as its safety, the AP reports. Medicare’s national coverage determination would become final by April 11, following a public comment period and further evaluation by the agency.

The requirement for clinical studies applies to the entire class of drugs of which Aduhelm is a pioneer, monoclonal antibodies that work against amyloid, a kind of protein that forms plaques characteristic of Alzheimer's disease. Biogen sharply disapproved of Medicare's decision. The company said in a statement that the decision "denies the daily burden of people living with Alzheimer’s disease." The Alzheimer's Association called it "shocking discrimination against everyone with Alzheimer’s disease," but Vermont Independent Sen. Bernie Sanders applauded the decision as “an important step forward” in efforts to curb "outrageous" drug prices.

Biogen's initial launch price of $56,000 a year for Aduhelm led to an increase of nearly $22 in Medicare’s monthly "Part B" premium for outpatient care, the largest ever in dollar terms but not percentage-wise. Medicare attributed about half of this year’s increase to contingency planning for Aduhelm. Faced with skepticism over its medication, Biogen recently slashed the price to $28,200, but Medicare enrollees were already on the hook for the $170.10 premium. Medicare officials stressed Tuesday that they did not take cost into account in the coverage decision, but rather whether Aduhelm is "reasonable and necessary" for treating Alzheimer's patients enrolled in the program. Nonetheless, the high price of Aduhelm and the fact that most of the 6 million Americans with Alzheimer’s are old enough to be covered by Medicare stretched the limits. (More Aduhelm stories.)