Medicare limits coverage of $28,000-a-year Alzheimer’s drug

WASHINGTON » 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. Medicare’s national coverage determination would become final by April 11, following a public comment period and further evaluation by the agency.

“Alzheimer’s disease is a devastating illness that has touched the lives of millions of American families,” Medicare administrator Chiquita Brooks-lasure said in a statement. “CMS has been and remains committed to providing the American public with a clear, trusted, evidence-based decision that is made only after a thorough analysis of public feedback on the benefits and risks of coverage for Medicare patients.”

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.” Randomized clinical trials “will exclude almost all patients who may benefit.” The company said clinical trials can take months to years to set up and “hundreds of Alzheimer’s patients...are progressing each day from mild to moderate disease stages, where treatment may no longer be an option.”

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. Health and Human Services Secretary Xavier Becerra has directed Medicare to reassess the premium increase.

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. “While there may be the potential for promise with this treatment, there is also the potential for harm,” said Dr. Lee Fleisher, Medicare’s chief medical officer. “This harm may range from headaches, dizziness, and falls, to other potentially serious complications such as brain bleeds.” Clinical trials will attempt to determine the balance of risks and benefits, he said.

Medicare’s payment rates will be determined through a different process, officials said. The program will pay drug costs and other services for patients in agencyapproved trials.

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.

“Biogen came to market with an eye-popping price tag,” said Tricia Neuman, a Medicare expert with the nonpartisan Kaiser Family Foundation. “Even after they slashed their drug’s price in half, it is still more than $28,000, which is not insignificant. At that price, it is clearly an issue for the Medicare program, premiums and out-of-pocket costs.”