Thursday, July 17, 2014

WSJ examines Arkansas Medicaid denial of expensive drug for cystic fibrosis

Posted By on Thu, Jul 17, 2014 at 10:05 AM

The Wall Street Journal examines in depth today a federal lawsuit in Arkansas over the state Medicaid program's denial of coverage for an expensive drug to treat three plaintiffs with a rare strain of cystic fibrosis.

The drug, Kalydeco, costs $300,000 a year. A coming improved version might cost more. Arkansas has said the patients denied the drug coverage first must prove that older therapies are ineffective, a requirement that their lawyers say is contrary to recommended protocols and a denial of their civil rights.

State-mail dug up by lawyers show that cost has been a prime concern of state officials. Expensive new drugs are presenting dilemmas for Medicaid agencies across the country, the article notes. Said Matt Salo, executive director of the National Association of Medicaid Directors, a professional association:

We have this public health mentality that all people have to be cured no matter what the cost, and also let the innovators charge whatever they want. Those are fine theories independently, but when you combine them together in a finite budget environment, it's not sustainable.

Discussions in Arkansas are illustrative.

In a series of 2012 emails obtained by Chloe's attorneys and reviewed by The Wall Street Journal, Arkansas Medicaid officials discussed Kalydeco's cost. In an email to colleagues discussing a review board's deliberations about Kalydeco, a pharmacist named Pamela Ford wrote, "the consensus of the physicians on the board was that none of the prescribers would have a clue that this will cost AR Medicaid $303,408 per patient per year."

She also noted in a separate email that Vertex was working on a new product that would combine Kalydeco with another drug, which could treat the majority of cystic fibrosis patients. The new therapy would be "likely even more expensive" and a "budget-breaker!" Ms. Ford wrote. "So we will be very strict in these reviews knowing it will come back even worse the next go-round."

The kicker is the article close:

Brian O'Sullivan, a cystic-fibrosis specialist at University of Massachusetts Medical School, said the consensus among doctors is that all patients with the genetic defect should receive Kalydeco. Dr. O'Sullivan and other doctors criticized Vertex's pricing of the drug in 2012, saying the company was "leveraging pain and suffering into huge financial gain." But he called Arkansas's policy "unconscionable."

The plaintiffs are Chloe Jones, 14, and Elizabeth West and Catherine Kiger, both 21.

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