ELIMINATING HCV TRANSMISSION MAY REQUIRE STRUCTURAL CHANGE ... H… · • 340B: Maximum price that...
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ELIMINATING HCV TRANSMISSION MAY REQUIRE STRUCTURAL CHANGE IN HOW PRISONS PURCHASE MEDICATIONS M ADELINE A DEE C MPH M ADEE @ EMORY . EDU A NNE S PAULDING MD MPH A SPAULD @ EMORY . EDU
Transcript of ELIMINATING HCV TRANSMISSION MAY REQUIRE STRUCTURAL CHANGE ... H… · • 340B: Maximum price that...
ELIMINATING HCV TRANSMISSIONMAY REQUIRE STRUCTURAL CHANGEIN HOW PRISONS PURCHASE MEDICATIONS
MADELINE ADEE [email protected]
ANNE SPAULDING MD [email protected]
Outline 1. HCV Screening in Correctional Facilities• Current status
• Barriers
2. Who Pays for Treatment?
3. Current Work• Barriers to decreasing price for treatment
• What correctional facilities pay for DAAs
• How to get less expensive drugs in to prisons
Current Status of Screening in Prisons and Jails
• Many states do not have routine screening
• Inconsistencies in prevalence estimates based on choice of numerator and denominator• Inclusion of known positives?• Out of tested or entire prison
population?
Disincentive to Screen in Prisons
Newly identified medical issues
Greater responsibilityto treat
8th amendment of the Constitution prohibits cruel and unusual punishment, which includes
“deliberate indifference to health needs” (Estelle v. Gamble 1976)
Increased medical costs
This becomes an issue with hepatitis C when prisons cannot afford
costly DAAs
Primary challenge is cost. Who is paying?
Prisons bear up-front costs:• Screening• Counseling• Drugs and medical care• Connection to care after release
• Society and individuals benefit • Gain life years• Avert medical costs • Prevent new infections
Cost-effectiveness in Prisons: Hepatitis C Treatment
Our Research
•Collaboration with Lawyer: Bill von Oehsen
•Infectious Disease Clinics of North America – will be published online soon
Barriers to Decreasing Price
•Pharmaceutical company can’t just negotiate with a DOC to very low price due to federal pharmaceutical pricing regulations
•Negotiating too low with prison systems disrupts even bigger markets, such as Medicaid. • In order to participate in the Medicaid Drug Rebate Program (MDRP), must give Medicaid the “best
price”
Barriers to Decreasing Price•State prisons are not eligible for the same discounts as safety-net hospitals, VA, or FBOP-- they all purchase through mechanisms that are exempt from best price• Safety net hospitals: 340B Program
• Veterans Administration: Federal Ceiling Price Program
• Federal Bureau of Prisons: Federal Supply Schedule
• AWP: Average wholesale price. The “list” price.
• 340B: Maximum price that can be charged to a 340b covered entity.
SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017
$69,773
$49,657
$38,186
$4,966$400
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
AWP AMP 340B, MDRP Nominal PriceCeiling
Cost to Produce
Estimated Price per Course of Treatment, DAAs for Hepatitis C
• AWP: Average wholesale price. The “list” price.
• AMP: Average manufacturer price. The average price paid to the manufacturer by wholesaler or other direct purchaser.
• 340B: Maximum price that can be charged to a 340b covered entity.
SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017
$69,773
$49,657
$38,186
$4,966$400
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
AWP AMP 340B, MDRP Nominal PriceCeiling
Cost to Produce
Estimated Price per Course of Treatment, DAAs for Hepatitis C
• AWP: Average wholesale price. The “list” price.
• AMP: Average manufacturer price. The average price paid to the manufacturer by wholesaler or other direct purchaser.
• 340B: Maximum price that can be charged to a 340b covered entity.
• Nominal Price: Price that is less than 10% of AMP. Certain “safety net” providers can negotiate nominal price with manufacturers, without there being a violation of federal drug pricing laws.
SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017
$69,773
$49,657
$38,186
$4,966$400
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
AWP AMP 340B, MDRP Nominal PriceCeiling
Cost to Produce
Estimated Price per Course of Treatment, DAAs for Hepatitis C
• AWP: Average wholesale price. The “list” price.
• AMP: Average manufacturer price. The average price paid to the manufacturer by wholesaler or other direct purchaser.
• 340B: Maximum price that can be charged to a 340b covered entity.
• Nominal Price: Price that is less than 10% of AMP. Certain “safety net” providers can negotiate nominal price with manufacturers, without there being a violation of federal drug pricing laws.
SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017
$69,773
$49,657
$38,186
$4,966$400
$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
AWP AMP 340B, MDRP Nominal PriceCeiling
Cost to Produce
Estimated Price per Course of Treatment, DAAs for Hepatitis C
$20,000
$14,234$10,946
$1,423 $400$0
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
$80,000
AWP AMP 340B, MDRP Nominal PriceCeiling
Cost to Produce
Estimated Price per Course of Treatment, DAAs for Hepatitis C
Ways of Decreasing Price1. Pooled procurement
2. Contracts with entities eligible for discounts under the 340B Drug Pricing Program
3. Nominal pricing
4. Section 1115 waiver
5. Change best price rule statutorily
6. Purchasing a patent◦ Recommended in A National Strategy for the Elimination of Hepatitis B & C: Phase Two
Report
7. Invoke 28 U.S.C. §1498oRecently considered as a potential strategy by Louisiana
Nominal Pricing: a Possible Solution for Correctional Facilities
•Hurdles to nominal pricing
• Finding a willing seller
• DHHS determining that prisons can count as a “safety net provider”
• Prisons may still need to expand budget for HCV testing and treatment
•Requires cooperation on the part of the manufacturer, but could be beneficial to them as well
• Prisons are an untapped market
• At a nominal price of $4,000 per course of treatment, drugs could still be produced for a small fraction of sales price
• Wouldn’t disrupt other DAA markets
• Nominal price by definition must be less than 10% of AMP – very substantial discount
Gap in the Marketplace: HCV Therapy Demand Curve
Number of Persons with Chronic Hepatitis C Hypothetically Treated and Missed under Three Pricing Strategies. • FY 2017, Georgia
Department of Corrections treated 219 Patients with DAAs
• At AWP prices, this would cost $15,280,287
• The same amount of money could treat 400 people at 340B pricing, or 3,820 people at a nominal price of $4,000.
under 3 Schema: AWP,
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
Average WholesalePricing
340B Pricing Nominal Pricing
Nu
mb
er o
f V
irem
ic In
div
idu
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Treated Not Treated
Data Source: Georgia Department of Corrections, FY 2017- FY 2018
Questions?
CONTACT I NFO:
MADELINE ADEE CMPH
ANNE SPAULDING MD MPH
