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ProAct
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Inflation Reduction Act & Drug Price Negotiation Program Update

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The Inflation Reduction Act (IRA) of 2022 established a Drug Price Negotiation (DPN) Program for Medicare. The program requires the U.S. Department of Health and Human Services (HHS) to negotiate prices with drug manufacturers for some single-source medications covered under Medicare Part B and Part D. HHS is scheduled to release, on September 1, 2023, the first list of selected, qualifying medications, and to begin negotiations on October 1, 2023. In June 2023, Merck & Co. filed the first lawsuit against HHS challenging the constitutionality of the DPN program. The Ohio Chamber of Commerce, Bristol Myers Squibb, and Pharmaceutical Research and Manufacturers of America have also filed lawsuits challenging the constitutionality of the DPN program. The impact the DPN program will have in the commercial space is still unknown as prices on the selected single-source medications could remained unchanged or even possibly increase as drug manufacturers look to offset losses in revenue. For more information, visit: https://www.cms.gov/inflation-reduction-act-and-medicare/medicare-drug-price-negotiation and https://jamanetwork.com/journals/jama-health-forum/fullarticle/2787467

Humira Biosimilar Formulary Update

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Inflammatory medications represented nearly 30% of total drug spend across our book of business in 2022.  It’s estimated that competition created with biosimilars can save the U.S. $225 billion to $375 billion in pharmacy spend by 2031.

As part of our commitment to driving greater affordability, ProAct will add the following biosimilar products to our Advantage and Core formularies, alongside Humira (adalimumab) and the biosimilar Amjevita (adalimumab-atto):

  • Cyltezo (adalimumab-adbm) (Boehringer Ingelheim), the first interchangeable biosimilar with Humira, low concentration formulation
  • Adalimumab-adaz (Sandoz), high-concentration formulation, unbranded
  • Hyrimoz (Sandoz), high-concentration formulation

ProAct will continue to conduct individual reviews of new biosimilar products for potential formulary placement as they become available, to ensure each product meets clinical standards and provides cost-savings. We are also committed to helping accelerate the market transition to biosimilars while preserving choice and flexibility for patients.

Two New Gene Therapies Granted FDA Approval

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On June 22, 2023, the FDA granted approval to Sarepta Therapeutics’ Elevidys (delandistrogene moxeparvovec-rokl), this is the first gene therapy for the treatment of patients 4 through 5 years of age with Duchenne Muscular Dystrophy (DMD) with a confirmed mutation in the DMD gene. Sarepta announced the pricing for Elevidys at $3.2 million for the one-time treatment. On June 29, 2023, the FDA also approved BioMarin Pharmaceutical’s Roctavian (valoctocogene roxaparvovec-rvox), the first gene therapy for the treatment of adults with severe hemophilia A. BioMarin stated that Roctavian will be commercially available in 2 months at a wholesale acquisition cost (WAC) of $2.9 million for the one-time treatment.

ProAct Biosimilar Strategy Update

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Although Humira will remain on ProAct’s preferred formulary at least until January 1, 2024, ProAct is continuing to monitor the biosimilar space as more Humira biosimilars launch to market this summer. The main two scenarios we are evaluating leading to January 1st include:

  1. Humira continues to remain preferred along with some of its biosimilars, considering AbbVie's ability to provide a manufacturer-specific bundle Humira, Rinvoq, and Skyrizi together, or
  2. Humira loses preferred formulary status and some of the lower cost Humira biosimilars options become preferred on ProAct’s formulary.

In both scenarios, we expect Humira plan spend to decrease in the coming years due to the introduction of competition. Based on recent settlement agreements, Stelara will be one of the next major drugs in the anti-inflammatory space to face biosimilar competition in early 2025. There are several manufacturers that may have biosimilar versions of both Humira and Stelara on the market in 2025, including Amgen and Teva, so we could see a manufacturer-specific biosimilar bundle in the future. Estimates show upwards of a 65% shift away from Stelara to biosimilars by 2027. Additional considerations for Stelara include several newer agents in the same class. These newer agents are designed to demonstrate superiority over Stelara in Crohn’s Disease, in which Stelara has the largest representation. Based on the studies' results, we could see a negative impact to Stelara utilization and transition to a newer agent.

Pharmacologic Therapy for Diabetes Mellitus

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Drug therapy can bring a complexity to a diabetic’s healthcare and every day life as there are many different types of drugs that work in different ways to help keep blood sugar under control.…

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