Securing Access to Life-Saving Antimicrobial Drugs for American SeniorsAdministrator Seema Verma
Securing Access to Life-Saving Antimicrobial Drugs for American Seniors
Antimicrobial resistance (AMR) represents an urgent clinical and economic crisis for the American health care system. Each year, more than 2 million Americans are infected by bacteria that are resistant to existing antibiotic drugs, resulting in thousands of deaths annually. Seniors are uniquely vulnerable to AMR due to age-related immunosuppression and greater exposure to infection (e.g., from catheters or chronic disease). Indeed, our internal analysis at CMS indicates that Medicare beneficiaries account for the majority of cases of both new diagnoses of drug-resistant infections and the resulting deaths in hospitals in the United States. Drug resistance causes Medicare beneficiaries to spend hundreds of thousands of additional days in the hospital each year, costing taxpayers billions in additional health care costs annually.
Unfortunately, as patients’ need for new antimicrobial drugs has mounted, innovation has remained adversely affected by government roadblocks. Even though a number of regulatory reforms (e.g., the Limited Population Pathway for Antibiotics) and public-private partnerships (e.g., CARB-X) have been established to spur drug development, market failures for antimicrobials continue to persist due to challenges that innovators encounter with payment. For example, the antibiotic manufacturer Achaogen filed for bankruptcy despite successfully gaining FDA approval for its drug, ZEMDRI, which received more than $200 million in funding from the U.S. government (e.g., federal development contracts, post-market incentive payments). The commercial failure of ZEMDRI, which is a novel treatment for complicated urinary tract infections, occurred in part because Medicare’s volume-based approach to payment was insufficient at capturing the full public health benefit of the antibiotic, causing taxpayer dollars to be used inefficiently and potentially leaving seniors without access to a needed new innovation.
As a steward for the health of our nation’s seniors, our agency is committed to removing regulatory restraints on innovators and modernizing payment systems to secure access to medications for Medicare beneficiaries and all Americans. We recognize the public health importance of AMR and the recent crisis in the antimicrobial drug marketplace, and have quickly mobilized to lead an interagency effort in partnership with the Biomedical Advanced Researched and Development Authority (BARDA) to reinvigorate innovation for new antimicrobials. I am proud to announce that CMS has developed a bundle of reforms to secure Medicare beneficiaries’ access to antimicrobials in the short-term and realign financial incentives to sustain innovation in the long-term.
Realigning Financial Incentives for Antibiotic Development
CMS thus faces a dual challenge – reining in inappropriate prescriptions of antibiotics to slow the rate at which drug resistance develops, while simultaneously ensuring that payments for new antibiotic drugs that address AMR are sufficient to reflect the value of these medical products, particularly given the naturally low prescription volume due to the limited size of the patient population.
To address the issue of payment, CMS is developing an alternative NTAP pathway for QIDPs that does not require substantial clinical improvement and also increases payments to 75%. Limiting access to the current upper band of NTAP to only QIDP drugs reflects the agency’s awareness of the public health imperative for novel antibiotics. This both reduces barriers to accessing the incentive while ensuring that payment systems reflect the value of new innovations. With regards to the challenge of slowing the rate of resistance, we are still reviewing the rule on our proposed new requirements for infection prevention and control programs in hospitals to incorporate public feedback. CMS is wholeheartedly committed to improving patient safety and care by fostering compliance with evidence-based guidelines for antibiotic stewardship.
Modernizing Medicare Payments to Reflect Public Health Value
Of course, we recognize that coding requires continuous monitoring due to the evolving nature of new technologies. Consequently, we have noted in the preamble to the FY 2020 IPPS rule that CMS will also seek further feedback about additional changes to the DRG system, such as any additional payment adjustments for antimicrobial resistance based on the relative hospital resources used in these cases, allowing us to receive feedback from stakeholders on this topic. This will help inform our thinking beyond IPPS on how to implement additional reforms to the government’s current payment methodologies and pave the road for new antimicrobial drug innovations in the long-term.
Bringing Stewardship Efforts to Scale
The Path Forward