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Cost of Alzheimer's Drug Could Push Medicare to the Brink

Biogen product would nearly double program's medication budget, though it might not work
By Bob Cronin,  Newser Staff
Posted Jun 11, 2021 1:00 PM CDT

(Newser) – The Food and Drug Administration's approval of a new drug to treat Alzheimer's disease could have enormous implications not just for patients, but for Medicare—even pushing the program toward collapse. FDA approval historically has meant Medicare will cover the cost of the medication, but with Biogen's product, that's complicated, Vox reports. Experts say there isn't enough evidence that the drug, aducanumab, works. Three advisers to the FDA quit when their panel's advice to withhold approval was ignored. There's no treatment at the moment for Alzheimer's, and it's difficult to rule out anything that could help the 6 million patients and their families deal with the debilitating disease. But "there’s very little potential that this will address the needs of patients," said an expert who worked on the drug's trials. In fact, some experts are concerned that the FDA's decision could result in lower standards for approving drugs in the future, per the New York Times.

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Then there's the cost. Biogen set a preliminary price for the drug, to be sold as Aduhelm, of close to $56,000 per year per patient, which would put the total cost above $100 million, which would mostly fall to Medicare. This single drug would almost double the amount Medicare spends on drugs, per Vox, an increase that would be passed on in taxes or raised premiums. Some analysts say the drug should be priced much lower, but the government can't do much about that, though other nations can negotiate the price of medications. One investment advisory note said the expense "could break the Medicare program." This issue could determine the future of Medicare, which always is at risk of a drug being approved that has a prohibitive cost. "Every conversation we’re going to have for the next few years about health care access is going to be about this drug, whether implicitly or explicitly," said a law professor. (Read more Alzheimer's Disease stories.)

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