How Will Medicare Pay for $56,000/year FDA-Approved Alzheimer's Drug That May Not Be Very Effective? Lawmakers Intervene.

By B.N. Frank

The Food and Drug Administration (FDA) seems to have again stepped into a mess of their own making by approving a controversial new Alzheimer’s drug. Of course if wasn’t so expensive, maybe Americans wouldn’t be so concerned about how Medicare was going to pay for all Alzheimer’s patients to take it.

From Ars Technica:

Controversial Alzheimer’s drug could cost US $334B—nearly half of DoD budget

Despite unproven efficacy, Biogen set the drug’s list price at $56,000 per year.

Concern is mounting over the price of the controversial new Alzheimer’s drug Aduhelm. Advocates, lawmakers, and critics worry in particular about what the drug’s $56,000 per-year list price will do to Medicare. The federal insurance program is available to those age 65 and over, which covers the vast majority of the roughly 6 million adults with Alzheimer’s in the US.

As it stands, the cost of Aduhelm—a doctor-administered intravenous drug—has the potential to eclipse the amount of money Medicare spends on all other doctor-administered drugs and retail prescription drugs, combined.

The Food and Drug Administration granted approval of Aduhelm earlier this month, sparking widespread and intense criticism. Experts and industry watchers have called the decision “disgraceful” and “dangerous,” noting that clinical trials of Aduhelm did not clearly show that the drug is actually effective at treating Alzheimer’s. The fact that Aduhelm’s maker, Biogen, set the list price so high only intensified the criticism.

An analysis earlier this month by the Kaiser Family Foundation pointed out that if just a quarter of the 2 million Medicare beneficiaries who currently use an Alzheimer’s treatment—so 500,000 or so beneficiaries—begin taking Aduhelm, it would cost Medicare an estimated $29 billion a year. In 2019, Medicare spent $37 billion on all doctor-administered drugs, total.

A new analysis released Monday by Stat pushed the numbers further. The outlet estimated that if all 5.8 million Medicare-eligible adults with Alzheimer’s began taking Aduhelm, it could cost Medicare $334.5 billion a year. Stat noted that $334.5 billion is nearly half of the entire budget for the Department of Defense—or about 4 million Tesla Model Xs (for those who think in terms of Teslas). The eye-popping total also significantly exceeds Medicare’s spending on doctor-administered and retail prescription drugs combined, which totaled about $220 billion in 2019.

“Serious concerns”…

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