Latebreakers: January 8, 2007

January 8, 2007

CMS issued new rules governing Medicaid reimbursement on Dec. 22 that would cut more than $8 billion in Medicaid prescription generic drug reimbursements over a five-year period. Reimbursement for brand-name drugs would not be impacted, but CMS estimates it will reduce reimbursements for generics by $800 million in 2007 alone.

CMS drops AMP Christmas surprise

CMS issued new rules governing Medicaid reimbursement on Dec. 22 that would cut more than $8 billion in Medicaid prescription generic drug reimbursements over a five-year period. Reimbursement for brand-name drugs would not be impacted, but CMS estimates it will reduce reimbursements for generics by $800 million in 2007 alone. The new rules establish reimbursement as 250% of average manufacturers price (AMP). Pharmacy leaders have expressed deep reservations over several elements in the 150-page rules and their impact on Medicaid recipients and pharmacies. John Rector, NCPA's VP and general counsel, promised an "aggressive reaction to the policy. If it goes into effect, it will have a devastating impact on pharmacy." The rules did not go into effect on Jan. 1 as some had worried and are open for comment until Feb. 20.

New molecular entity for schizophrenia

Brain infection leads to deaths after Rituxan injection

An emerging risk of progressive multifocal leukoencephalopathy (PML) in patients taking rituximab (Rituxan, Biogen Idec/Genentech) has prompted the FDA to issue a warning to healthcare professionals and patients using the drug. The agency has received reports of two deaths in patients with systemic lupus erythematosus (SLE) who received treatment with rituximab and later developed the fatal viral infection. The FDA warned that the use of rituximab to treat SLE is not an approved indication and that the drug has been approved only for the treatment of non-Hodgkin's lymphoma and rheumatoid arthritis. Healthcare workers are encouraged to report any serious adverse events possibly associated with rituximab to the FDA's MedWatch Adverse Event Reporting program at http://www.fda.gov/MedWatch/report.htm.

Rule offers increased access to experimental meds

Expanded access to experimental drugs may soon become a reality. The FDA has proposed a rule allowing patients better access to investigational drugs by making them more widely available to patients with serious or life-threatening diseases or conditions who lack other therapeutic options and who may benefit from such therapies. One proposal point is to establish criteria that link the level of evidence needed to support the use of an experimental drug to the seriousness of the disease and the number of patients likely to be treated with the drug. Among other things, the proposal seeks to revise the current regulation regarding how manufacturers recover the costs of an experimental drug. In addition, the new rule would update regulations to include all circumstances under which access to experimental drugs is permitted. These include single patients in nonemergency and emergency settings, small groups of patients, and larger groups under a treatment IND. The proposal will be open for public comment for 90 days and can be accessed in detail at the CDER Web site ( http://www.fda.gov/cder/regulatory/applications/IND_PR.htm).

GPhA pushes Congress on biopharmaceuticals in 2007

In a teleconference, Kathleen Jaeger, president/CEO of GPhA, said it's time for Congress to take action regarding the issue of generic biopharmaceuticals. "Biopharmaceuticals are growing at an enormous rate-nearly twice the rate of traditional pharmaceuticals-accounting for roughly $35 million in U.S. sales," she said, adding that the growth is meaningless if Congress does not address cost and access. Generic biopharmaceuticals would bring competition into the system, reduce costs, and increase access, she said. "Today, the FDA has the ability to review generic biopharmaceuticals with low to modest complexity and decide when and if additional tests will be needed to show that the medicine has the same efficacy and safety profile."