Recent Trends in Medicaid Spending and Use of Drugs With US Food and Drug Administration Accelerated Approval

Abstract

IMPORTANCEState Medicaid programs have reported concerns about rising drug prices and spending, particularly regarding drugs entering the market through the accelerated approval program under the US Food and Drug Administration (FDA). The accelerated approval program enables the FDA to approve drugs on the basis of unverified surrogate end points, meaning that clinical benefits for these products are uncertain at the time of approval. However, state Medicaid programs are legally required to cover these drugs. Little is known about the set of products with accelerated approval over time, their use among Medicaid beneficiaries, or the magnitude of their financial influence on state Medicaid programs. OBJECTIVE To identify the number and class of drugs approved through the FDA's accelerated approval pathway and analyze state Medicaid programs' use and spending on these drugs from 2015 through 2019. DESIGN, SETTING, AND PARTICIPANTS In this cross-sectional study, biannual FDA reports were

Reforming Reimbursement for the US Food and Drug Administration’s Accelerated Approval Program to Support State Medicaid Programs

“…The accelerated approval program has evolved substantially since its establishment. A previous study 6 found that, in the pathway's first decade, only 40 approvals were granted for HIV/AIDS medications (40%), oncologic products (30%), and other conditions (30%). Since then, the program has changed in 2 key ways.…”

“…Between 2011 and 2020, this number increased to 12.9 approvals per year. 6 Second, the conditions for which manufacturers seek accelerated approval have also changed, shifting toward oncologic products. In 2020, 28 of the 30 approvals made were for products with oncologic indications, most of which were highly focused (eg, treatment must be for refractory illness or after previous specific courses of treatment).…”

“…In previous work, we reported that although accelerated approval drugs represented less than 1% of Medicaid drug use, they represented an outsized share (between 6% and 9%) of annual Medicaid drug spending net of rebates between 2015 and 2019. 6…”

“…Although policy makers and experts have begun to propose various strategies for potential accelerated approval reforms, 4,5 most focus on reforming the FDA's processes for approving and regulating these products. Previous work regarding the financial implications of the accelerated approval pathway for state Medicaid programs 6,7 provides context regarding the need for coverage and reimbursement reforms for drugs with accelerated approval status. Herein, we provide a more comprehensive examination of the legal obligations of payers to provide reimbursement for products approved via the accelerated approval pathway, particularly through state Medicaid programs, explain how industry's changing use of the accelerated approval program has exacerbated fiscal challenges for Medicaid, and propose and analyze novel policy reforms that would balance the goal of speeding approval of important medicines with states' concerns regarding spending on medications with little evidence of clinical benefits.…”

The Perils of Increasing Medicaid Rebates for Drugs With Accelerated Approval

“…This approach reduces revenues for highly effective drugs such as imatinib (Gleevec), which received accelerated approval in 2001, while still allowing enormous expenditures on minimally effective drugs such as eteplirsen (Exondys 51), which received accelerated approval in 2016 and was listed at $300 000 per year. Even for drugs eventually showing no benefit of any amount-Sachs et al 1 The conflation of evidence with efficacy also diverts attention from the far larger volume of drugs without accelerated approval that contribute to high Medicaid drug expenditures. 1 New drugs, with or without accelerated approval, tend to represent a disproportionate share of total pharmaceutical expenditures.…”