Despite Medicare coverage, the drug with a list price of $26,500 may remain out of reach for many patients, policy experts say
The U.S. Food and Drug Administration on Thursday granted full approval to the Biogen BIIB, -0.31% and Eisai Co. Ltd. ESALF, +1.20% Alzheimer’s treatment Leqembi, a step that secures Medicare reimbursement for the first drug shown to slow the progress of the disease, rather than just treating its symptoms.
Leqembi, also known as lecanemab, is a monoclonal antibody designed to reduce the buildup of amyloid beta plaque in the brain, a marker of Alzheimer’s disease.
The FDA action Thursday “is the first verification that a drug targeting the underlying disease process of Alzheimer’s disease has shown clinical benefit in this devastating disease,” Teresa Buracchio, acting director of the Office of Neuroscience in the FDA’s Center for Drug Evaluation and Research, said in a statement.
About 6.7 million people in the U.S. aged 65 and older are living with Alzheimer’s — a number that could grow to 12.7 million by 2050, absent medical breakthroughs to prevent or cure the disease, according to the Alzheimer’s Association.
The FDA in January granted Leqembi accelerated approval, which allows for earlier approval of drugs that treat serious conditions where there is an unmet medical need, even while studies to confirm the expected clinical benefit are ongoing. In a late-stage trial, the treatment slowed declines in cognition and function by 27% compared with a placebo over 18 months.
A panel of FDA advisers in early June unanimously voted in favor of Leqembi, saying clinical studies had verified its benefit, although several experts during the open public-hearing portion of the meeting raised concerns about safety issues identified in the clinical trials, including potential brain swelling or bleeding. The drug’s label will have a boxed warning about amyloid-related imaging abnormalities, which usually have no symptoms but in some rare cases cause life-threatening brain swelling, the FDA said Thursday.
The Centers for Medicare and Medicaid Services said in June that Medicare will cover new Alzheimer’s treatments such as Leqembi if the drugs get traditional FDA approval and the beneficiary’s doctor and clinical team participate in the collection of real-world evidence about how the drugs are working. That announcement was “a big win” for Biogen as well as Eli Lilly LLY, -0.53%, which is developing its own treatment in the category, donanemab, BMO Capital Markets analysts wrote in a June research note. The analysts estimate peak sales of $14 billion for Leqembi and $17 billion for donanemab, according to the report.
Even with Medicare coverage, however, Leqembi may remain out of reach for many patients, policy experts say. With a list price of $26,500, Medicare patients taking the drug will have to pay more than $5,000 per year out of pocket, based on the 20% coinsurance required in traditional Medicare — and Medicare beneficiaries have a median income of about $30,000, according to health policy nonprofit KFF. People with supplemental insurance, such as Medigap, may have lower out-of-pocket costs.
Medicare coverage of the new treatment could significantly boost the total spending in Medicare Part B, which covers drugs, such as the infusion Leqembi, that typically aren’t self-administered. If 10% of older adults with Alzheimer’s disease take Leqembi, annual Medicare spending on the drug would be about $17.8 billion — or close to half the $40 billion in total spending on the more than 600 Part B-covered drugs in 2021, according to a recent KFF analysis.
That increased spending may also lead to higher Part B premiums, according to KFF. By law, Part B premiums must equal 25% of the estimated total costs of the program. Part B premiums jumped 15% for 2022 based in part on uncertainty about Medicare’s potential spending on Aduhelm, the first new Alzheimer’s treatment in this category, which was granted FDA accelerated approval in 2021. Part B premiums dropped 3% for 2023, based in part on a price cut for Aduhelm and Medicare limiting coverage of the drug.
Medicare’s requirement of a patient registry as a condition for coverage of the new Alzheimer’s treatments has drawn fire from some patient advocates and other groups who say it’s an unnecessary barrier to care. Although registries can gather real-world evidence to improve patient care, they “should not be a requirement for coverage of a FDA-approved treatment,” the Alzheimer’s Association said in a June statement.
CMS said in late June that the information collected “will help to evaluate the appropriateness of the treatment for the Medicare population.” Providers treating patients with the drug will submit data on the results of cognition and overall function tests, any evidence of brain swelling, hemorrhage, or other adverse events, and other details, the agency said.