Medicare Officials Insisting on Wider Choices in Drug Benefits
In today’s New York Times’ article on Medicare Part D formularies, Robert Pear interviews insurers and managed care executives who suggest that CMS is being more diligent in its efforts to ensure broad formulary coverage for the plan than some had previously expected them to be. What does this mean for pharma and for the program? Hard to say for sure, but right now, I would suppose two possible outcomes. The first is that smaller companies will be able to compete more effectively with larger companies, without having to partner, in order to get their follow-on drugs on these formularies (at least for the six key therapeutic classes identified in the article). This is very good news for some specialty pharma and biopharma companies. The second outcome, which is more speculative, is that costs to the program could spiral upward as some of the more expensive drugs get listed when they otherwise might not. This is alluded to in the NYT piece. It’s hard to say, though, until the formularies are revealed, as some of the less often used drugs for more prevalent conditions in this elderly population could be somewhat less expensive than those more often used. I’ll update this story when we know more specifics about the formularies.
