Alnylam Pharmaceuticals Issues Public Comment on Centers for Medicare & Medicaid Services Proposed Rule

WASHINGTON, Oct. 16 -- Alan Eisenberg, vice president for global public policy and government relations at Alnylam Pharmaceuticals Inc., Cambridge, Massachusetts, has issued a public comment on the Centers for Medicare and Medicaid Services proposed rule entitled "Most Favored Nation Model". The comment was written on Oct. 12, 2021, and posted on Oct. 14, 2021:

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Alnylam(R) Pharmaceuticals, Inc. (Alnylam) thanks the Centers for Medicare & Medicaid Services (CMS) for this opportunity to comment on the Most Favored Nation (MFN) Model proposed rule, CMS-5528-P.

Alnylam has led the translation of RNA interference (RNAi) from a Nobel Prize winning discovery into a new class of innovative medicines with the potential to transform the lives of patients who have limited or inadequate treatment options. Our pioneering work has delivered the world's first and only Food and Drug Administration (FDA) approved RNAi therapeutics--ONPATTRO(R) (patisiran) in 2018, GIVLAARI(R) (givosiran) in 2019, and OXLUMO(TM) (lumasiran) in 2020--for rare, and often fatal, diseases. We are advancing a deep pipeline of innovative RNAi medicines in four strategic therapeutic areas: genetic medicines, cardio-metabolic diseases, infectious diseases, and central nervous system and ocular diseases.

Alnylam supports the proposal to rescind and remove the regulations at 42 CFR part 513 and therefore withdraw the MFN Model. The MFN Model would have negative impacts on access to needed medications for patients with rare and life-threatening diseases and impose a financial burden on the healthcare providers who treat them. Medicare policy should encourage reliable access to medically necessary treatments for all Medicare beneficiaries and should support clinicians who treat patients with rare, life-threatening diseases. Alnylam supports policies that help beneficiaries access the therapies they need, and that enable providers to treat patients with the therapies they deem most effective without reference to practice economics. The MFN Model would do neither.

We believe there is no amount of modification to this Model that could minimize the damage its implementation would do to patients who have critical need for Part B therapies. The negative implications the Model's implementation would have for Part B therapies - both those included as well as those excluded from the Model - are myriad, indelible, and highly concerning. Therefore, we support CMS's proposal to immediately rescind and remove the regulations at 42 CFR part 513, withdrawing the MFN Model in its entirety.

As a member of the Biotechnology Innovation Organization (BIO), we are aligned with the trade association's opposition to the MFN Model and comments on its withdrawal. We provide our own comments below with respect to the disproportionate impact the MFN Model would have on Medicare beneficiaries with rare and life-threatening diseases and on the providers who care for them.

1. The MFN Model would significantly impact providers who treat patients suffering from rare, life-threatening diseases who are administered both MFN and non-MFN Part B therapies.

Of the 50 drugs in the MFN Model for Year 1, 10 drugs are exclusively indicated to treat rare diseases and 22 drugs have one or more orphan drug designations./1

It is clear, therefore, that the MFN Model would have a direct impact on patients with rare diseases and the clinicians who treat them.

The MFN Model would alter reimbursement for the 50 Part B drugs within the Model by setting the drug payment amount to the lowest amount paid among a set of OECD nations and by changing the add-on fee to a flat amount of approximately $149. The add-on payment associated with Medicare Part B drug reimbursement is intended to cover costs related to administration overhead. Some rare disease therapies have complex administration, storage and/or handling requirements. For Medicare Part B drugs in the Model, the reduction in add-on payment alone would result in a significant drop in total drug reimbursement, which could directly impact a practice's ability to cover the associated overhead costs for administration, storage and handling.

Although the MFN Model would have an immediate and direct impact on those drugs included in the Model, it would also have an indirect but significant and perhaps equally damaging impact on patients administered non-MFN Part B therapies and the providers who administer them. Clinicians who treat patients with rare diseases often treat patients with more common conditions; as a result, they typically prescribe a wide array of therapies. Physicians who would experience significant disruption as a result of MFN may react by shifting their treatment patterns for all Part B therapies. The CMS Actuary's own analysis suggests that there would be considerable adjustments for providers, and that in the long run, 20% of patients would lose access to therapies under this rule./2

This spillover impact could have the unintended consequence of creating access and quality issues for patients with rare diseases. Of the orphan drug approvals between 2000 and 2016, 27% are covered under the medical benefit (Part B), suggesting that over 1 out of 4 patients with rare diseases could be negatively affected by the MFN Model./3

If the Model were to be implemented, providers who treat Medicare patients with MFN drugs would be forced to choose one of a handful of options with respect to treatment choice for patients, none of which would be ideal for providers or patients:

* Continue to treat patients with MFN drugs, with undue economic burden caused by the reduced reimbursement;

* Send patients to MFN-exempt facilities or 340B facilities for treatment, which could disrupt care and potentially result in patients discontinuing needed therapy;

* Treat patients with healthcare practitioner (HCP)-administered drugs in-office through the process of "white bagging," which could create additional practice operational burden and increase patient out-of-pocket costs; or,

* Switch patients to other non-MFN Part B or Part D therapies, which may not be an option for patients with rare diseases where few alternatives exist and might result in higher patient out-of-pocket costs.

The shift in buy and bill behavior among MFN-impacted providers could be experienced in smaller, community-based practices, where the reduction in reimbursement might be less easy to overcome due to the lack of other lines of business. The deterioration of clinic-based practice could create the wrong incentives for lowering the costs of healthcare, as multiple studies have demonstrated the differences in costs of care between the physician office and the hospital outpatient department./4,/5,/6,/7

2. The MFN Model would significantly hamper access to Part B therapies for patients with rare, life-threatening diseases.

Given that the MFN Model would include orphan designated drugs and would certainly have spillover effects for non-MFN Part B therapies, the Model would threaten to hinder access for patients with rare diseases. As noted above, clinicians treating patients with MFN drugs might alter their buy and bill practices for those Part B therapies - and potentially all Part B therapies. In such instances, a few scenarios could be possible, all with potential negative ramifications for patients due to a switch in therapy (if one exists) or a switch in site of care.

In the Interim Final Rule with Comment, CMS acknowledged that approximately 19% of patients would lose access to their Part B drugs entirely as a result of the implementation of the Model./8

This prospect could dramatically harm patients with rare, life-threatening diseases with no therapeutic alternatives if their physicians were unable to treat them at a suitable, alternative site of care. It is therefore laudable that CMS is proposing to withdraw the MFN Model to protect Medicare patients - the elderly and most frail among us - from losing access to needed medication.

Patients whose providers would be more impacted by the MFN Model would be more likely to face the risk that their physician might choose to switch them to non-MFN Part B medicines or to Part D alternatives compared to patients whose providers would be less impacted. Switching therapies or switching benefit coverage, however, might not be feasible for patients with rare diseases, who often have few to no alternative treatments for their conditions, or who face benefit designs that would increase cost burden./9

In circumstances where "white bagging" or a Part D therapy alternative exist, patient out-of-pocket costs could dramatically increase as a result of the implementation of the MFN Model. In general, the vast majority of Medicare beneficiaries with Part B Fee-for-Service coverage often have a supplemental plan that reduces or covers the 20% coinsurance for Part B drugs and services./10,/11

This means that patients usually pay an annual deductible and a reduced copayment (if any) for their drugs and services. Under Medicare Part D, the lack of a patient out-of-pocket maximum and the prohibition on manufacturers to provide cost-sharing assistance means that patients with rare diseases face significantly higher costs for their therapies than when those therapies are covered under the Part B benefit./12,/13,/14,/15,/16

Should MFN-impacted providers decide to switch their patients to therapies covered under the Part D benefit, those patients might experience greater cost burden as a result of the MFN Model implementation. So, in effect, CMS would be raising patient financial burdens through this rule, rather than lowering them.

Patients might also be sent to MFN-exempt facilities or 340B facilities for treatment. These facilities might be considerably farther away from home than a patient's existing treatment site, and the shift in site of care could increase disease burden and negatively impact a patient's quality of life. For patients with rare disease, these considerations could be serious: many patients with rare disease already sometimes must travel long distances due to the lack of a specialist or center of excellence nearby. In fact, the National Organization for Rare Disorders (NORD(R)) reports that 39% of its 2019 survey respondents needed to travel 60 or more miles to access medical care related to their rare disease./17

Disease complications and comorbidities impacting comfort and mobility can make travel demands especially difficult for rare disease patients. The MFN Model could further increase travel time and travel burden for more patients.

In summary, Alnylam supports the proposal to rescind and remove the regulations at 42 CFR part 513 and therefore withdraw the MFN Model to prevent severe and negative impacts on patients with rare, life-threatening diseases and the providers who treat them. While we support value-based approaches to healthcare, this MFN Model would neither improve quality of care nor lower patient costs. We thank CMS for proposing to withdraw the rule and encourage CMS to work with the healthcare stakeholder community on alternatives that better support evidence-based, value-based care for Medicare beneficiaries who require Part B therapies.

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Alnylam appreciates the opportunity to comment. Should you have any questions, please do not hesitate to contact me at aeisenberg@alnylam.com.

Regards,

Alan Eisenberg

Vice President, Global Public Policy & Government Relations

Alnylam Pharmaceuticals, Inc.

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Footnotes:

1/ Alnylam analysis.

2/ Average change in drug payment for drugs with orphan indications only is -15%, and for drugs with both orphan and non-orphan indications is -13%.

3/ Cohen, J. "Orphan Drug Pricing And Reimbursement: Challenges To Patient Access." In Vivo Informa Pharma Intelligence. November 15, 2017. Accessible at: https://invivo.pharmaintelligence.informa.com/IV005214/Orphan-Drug-Pricing-And-Reimbursement-Challenges-To-Patient-Access. Accessed on January 22, 2021.

4/ Hargraves, J. and Reiff, J. "Shifting Care from Office to Outpatient Settings: Services are Increasingly Performed in Outpatient Settings with Higher Prices." Health Care Cost Institute. April 2, 2019. Accessible at: https://healthcostinstitute.org/hcci-research/shifting-care-office-to-outpatient. Accessed on January 25, 2021.

5/ Higgins, A., Veselovskiy, G. "Does The Site Of Care Change The Cost Of Care?" Health Affairs. June 2, 2016. Accessible at: https://www.healthaffairs.org/do/10.1377/hblog20160602.055132/full/. Accessed on January 22, 2021.

6/ "Medicare Payment Differentials Across Outpatient Settings of Care." Avalere Health. February 2016. Accessible at: http://www.siteneutral.org/wp-content/uploads/2016/06/4_Payment-Differentials-Across-Settings.pdf. Accessed on January 25, 2021.

7/ Reimers, K. "The Trends and Complexities of Provider-Administered Drugs." Magellan Health Insights. November 3, 2016. Accessible at: https://magellanhealthinsights.com/2016/11/03/the-trends-and-complexities-of-provider-administered-drugs/. Accessed on January 25, 2021.

8/ 85 FR 76237.

9/ National Organization for Rare Disorders (NORD). "Barriers to Rare Disease Diagnosis, Care and Treatment in the US: A 30-year Comparative Analysis." November 19, 2020. Accessible at: https://rarediseases.org/wp-content/uploads/2020/11/NRD-2088-Barriers-30-Yr-Survey-Report_FNL-2.pdf . Accessed on January 21, 2021.

10/ Cubanski, J., Damico, A., Neuman, T., and Jacobson, G. "Sources of Supplemental Coverage Among Medicare Beneficiaries in 2016." Kaiser Family Foundation. November 28, 2018. Accessible at: https://www.kff.org/medicare/issue-brief/sources-of-supplemental-coverage-among-medicare-beneficiaries-in-2016/. Accessed on January 25, 2021.

11/ Davis, K., Willink, A., and Schoen, C. "How the Erosion of Employer-Sponsored Insurance Is Contributing to Medicare Beneficiaries' Financial Burden." The Commonwealth Fund. July 25, 2019. Accessible at: https://www.commonwealthfund.org/publications/issue-briefs/2019/jul/erosion-employer-sponsored-insurance-medicare-financial-burden. Accessed on January 25, 2021.

12/ Cubanski, J., Koma, W., and Neuman, T. "The Out-of-Pocket Cost Burden for Specialty Drugs in Medicare Part D in 2019." Kaiser Family Foundation. February 1, 2019. Accessible at: https://www.kff.org/medicare/issue-brief/the-out-of-pocket-cost-burden-for-specialty-drugs-in-medicare-part-d-in-2019/. Accessed on January 25, 2021.

13/ Goldman, D. P., Jena, A. B., Lakdawalla, D. N., Malin, J. L., Malkin, J. D., and Sun, E. "The Value of Specialty Oncology Drugs." Health Services Research. January 8, 2010. 45(1): 115-132. Accessible at: https://dx.doi.org/10.1111%2Fj.1475-6773.2009.01059.x.

14/ Hwang, T. J., Jain, N., Lauffenburger, J. C., Vokinger, K. N., and Kesselheim, A. S. "Analysis of Proposed Medicare Part B to Part D Shift With Associated Changes in Total Spending and Patient Cost-Sharing for Prescription Drugs." Journal of the American Medical Association Internal Medicine. January 14, 2019. 179(3): 374-380. Accessible at: https://doi.org/10.1001/jamainternmed.2018.6417. Accessed on January 25, 2021.

15/ Parasrampuria, S., Sen, A. P., and Anderson, G. F. "Comparing Patient OOP Spending for Specialty Drugs in Medicare Part D and Employer-Sponsored Insurance." The American Journal of Managed Care. September 11, 2020. 26(9): 388-394. Accessible at: https://doi.org/10.37765/ajmc.2020.88489. Accessed on January 25, 2021.

16/ Sen, A. P., Parasrampuria, S., Anderson, K. E., and Anderson, G. "Catastrophic Coverage in the Medicare Part D Drug Benefit: Which Beneficiaries Need It and How Much Are They Spending?" The Commonwealth Fund. September 17, 2020. Accessible at: https://www.commonwealthfund.org/publications/issue-briefs/2020/sep/catastrophic-coverage-medicare-part-d-drug-benefit. Accessed on January 25, 2021.

17/ NORD 2020 at 5.

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The proposed rule can be viewed at: https://www.regulations.gov/document/CMS-2018-0132-3911

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