Top Stories in Business & Health for June 26, 2017 

FTC asks court to enforce subpoena in investigation of Walgreens-Rite Aid merger

In an “emergency petition” filed last Monday, the Federal Trade Commission (FTC) sought assistance from a federal court in getting Humana to turn over documents the agency wants to use in evaluating the competitive impact of the proposed $7 billion merger between Walgreens Boots Alliance and Rite Aid Corp. The FTC filed the subpoena April 10, requesting documents pertaining to Humana’s Medicare prescription drug plans. Wal-Mart is the preferred in-network pharmacy for those plans, and the FTC wants to determine if such narrow or preferred pharmacy networks are viable competitors to broader ones that include all major pharmacies. The FTC also asked for records of certain communications between Humana and the Centers for Medicare and Medicaid Services (CMS). Humana subsequently filed a petition to limit the FTC’s request, citing the costs involved in collecting and producing the documents, when Humana is “a non-party” in the proposed acquisition.  

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Continued scrutiny of prices leads to lower forecast for worldwide drug sales

Analysts predict that global sales of prescription drugs will reach $1.06 trillion in 2022, a substantially lower forecast than the $1.12 trillion they anticipated last year for 2022, according to a new report by Evaluate Pharma. This year marks the first time in a decade that the forecast for total drug sales has not exceeded the forecast from the previous year, Evaluate Pharma noted. “The continued political and public scrutiny over pricing of both the industry’s new and old drugs is not going to go away, and we are starting to feel the impact now,” Antonio Iervolino, Evaluate Pharma’s head of forecasting, told Reuters. Iervolino also pointed to lower-than-expected sales of certain new drugs, such as Amgen’s Repatha (evolocumab) and Sanofi and Regeneron Pharmaceuticals’ Praluent (alirocumab), both PCSK9 inhibitors used to treat high cholesterol.

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CMS proposes changes to ‘reduce burdens’ of Medicare physician payment system

CMS issued a proposed rule last Tuesday to simplify the Quality Payment Program, the Medicare physician payment system established under the Medicare Access and CHIP Reauthorization Act. The program went into effect this year; the proposed changes would be implemented for the 2018 performance year.  The proposed updates are intended to increase flexibility and reduce burdens, “especially for small, independent and rural practices,” according to a CMS news release.  Among the proposed changes, solo practitioners and groups of 10 or fewer eligible clinicians would have the option of participating in the Merit-based Incentive Payment System (MIPS) as part of a “virtual group.”  In addition, the low-volume threshold for MIPS would be increased, effectively exempting more than 585,000 eligible clinicians from the program, and new policies would be implemented with regard to clinicians’ ability to earn incentives for participation in advanced Alternative Payment Models. 

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Centene, Oscar Health to increase ACA exchange offerings for 2018

Last Wednesday was the deadline for insurers to decide if they would sell plans on the Affordable Care Act (ACA) marketplace, and two insurers made it clear that they intend to increase their presence next year.  Centene Corp., based in St. Louis, will begin offering plans in Kansas, Missouri and Nevada. It will also expand its offerings in Florida, Ohio, Texas and Washington. Oscar Health will continue to offer plans in New York, where it is based, and will expand or begin coverage in Ohio, New Jersey, Tennessee, California and Texas. Molina, based in Long Beach, Calif., filed preliminary rates in the nine states in which it currently offers coverage on the exchanges, as did Pittsburgh-based Highmark Health (three states) and Chicago-based Health Care Service Corp. (five states). 

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Senate releases “discussion draft” of Obamacare replacement 

On Thursday Senate Republicans released a discussion draft of their proposed ACA replacement bill, ending a weeks-long, closed-door process of limited participation among GOP senators. Known as the Better Care Reconciliation Act (BCRA), the legislation allows for greater state control over the implementation of health care, repeals most of the ACA’s tax increases on high-income earners, reduces federal funding for Medicaid and eliminates enforcement of the ACA’s individual and employer mandates. While much of the ACA’s structure is left in place, elimination of the individual mandate could be problematic in markets that depend on full marketplace participation. Health Affairs provides a more detailed look at the bill.

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CMS’ Hospital Value-Based Purchasing program still ineffective after 4 years, study indicates

The Hospital Value-Based Purchasing (HVBP) program, created under the ACA and launched in fiscal year 2013, still has not improved clinical processes or patient experience, nor has it significantly reduced mortality among patients admitted to the hospital for acute myocardial infarction or heart failure, according to research published in the June 15 issue of The New England Journal of Medicine. The study investigators said their findings are consistent with earlier assessments of the HVBP program, but they stand in contrast with results from the Medicare Hospital Readmissions Reduction Program (HRRP), which has successfully reduced rates of readmission for targeted conditions.

A possible explanation for difference in the two programs’ results, they said, is that the HVBP incentives are “much smaller” than those for the HRRP and are “spread over numerous domains and performance measures,” while the HRRP is more narrowly targeted. Moreover, the HVBP incentives consist of both penalties and bonuses, whereas the HRRP is based purely on penalties—which the researchers said “may have triggered a loss aversion among hospital administrators.”

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Memorial Hermann CEO abruptly resigns

Memorial Hermann Health System’s CEO resigned abruptly, after only a year in the role. Dr. Benjamin Chu, who also served as president of the health system, wrote in an email to Memorial Hermann employees that he was leaving “to pursue [his] passion in health and public policy.” Charles Stokes, Memorial Hermann’s chief operating officer, will serve as interim president and CEO. The Houston Chronicle noted that Dr. Chu is the third “major leader” to leave the Texas Medical Center this year. 

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FDA Approvals 

Shire gained FDA approval for Mydayis, a long-acting treatment for attention-deficit/hyperactivity disorder (ADHD). Approved for patients aged 13 years or older, Mydayis contains the same active ingredient as Shire’s Adderall—mixed salts of a single-entity amphetamine product—which is available in generic versions. Mydayis is formulated to last up to 16 hours, compared with up to 12 hours for Adderall XR. Shire anticipates launching Mydayis in the third quarter. Neos Therapeutics also received FDA approval for its ADHD drug, Cotempla (methylphenidate), an extended-release orally disintegrating tablet. Cotempla is approved for patients aged 6 to 17 years. Neos also makes Adzenys, a long-acting amphetamine in a similar formulation. 

The FDA approved Melinta Therapeutics’ Baxdela (delafloxacin) for adults with acute skin and skin structure infections caused by gram-positive and gram-negative bacteria, including methicillin-resistant Staphylococcus aureus. The antibiotic, a fluoroquinolone, is available in oral and intravenous formulations. 

Janssen Biotech has added another combination approval to its list for Darzalex (daratumumab). The FDA approved Darzalex in combination with dexamethasone and Celgene’s Pomalyst (pomalidomide) for patients with multiple myeloma who have not responded adequately to at least two previous therapies.

The FDA approved Novartis’ Tafinlar (dabrafenib) plus Mekinist (trametinib) combination therapy for patients with metastatic non-small cell lung cancer who carry the BRAF V600E mutation, making the combination therapy the first targeted treatment in the U.S. specifically for this patient population.