ELIMINATING HCV TRANSMISSION MAY REQUIRE STRUCTURAL CHANGE IN HOW PRISONS PURCHASE MEDICATIONS ANNE SPAULDING MD MPH

Transcription

1 ELIMINATING HCV TRANSMISSION MAY REQUIRE STRUCTURAL CHANGE IN HOW PRISONS PURCHASE MEDICATIONS MADELINE ADEE CMPH ANNE SPAULDING MD MPH

2 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

3 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?

4 Disincentive to Screen in Prisons Newly identified medical issues Greater responsibility to treat 8 th 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

5 Cost-effectiveness in Prisons: Hepatitis C Treatment 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

6 Our Research Collaboration with Lawyer: Bill von Oehsen Infectious Disease Clinics of North America will be published online soon

7 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

8 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

9 AWP: Average wholesale price. The list price. $80,000 $70,000 Estimated Price per Course of Treatment, DAAs for Hepatitis C $69, B: Maximum price that can be charged to a 340b covered entity. $60,000 $50,000 $40,000 $49,657 $38,186 $30,000 $20,000 $10,000 $0 $4,966 AWP AMP 340B, MDRP Nominal Price Ceiling $400 Cost to Produce SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017

10 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. $80,000 $70,000 $60,000 $50,000 $40,000 Estimated Price per Course of Treatment, DAAs for Hepatitis C $69,773 $49,657 $38,186 $30,000 $20,000 $10,000 $0 $4,966 AWP AMP 340B, MDRP Nominal Price Ceiling $400 Cost to Produce SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017

11 AWP: Average wholesale price. The list price. AMP: Average manufacturer price. The average price paid to the manufacturer by wholesaler or other direct purchaser. $80,000 $70,000 $60,000 Estimated Price per Course of Treatment, DAAs for Hepatitis C $69, B: Maximum price that can be charged to a 340b covered entity. $50,000 $40,000 $49,657 $38,186 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. $30,000 $20,000 $10,000 $0 $4,966 AWP AMP 340B, MDRP Nominal Price Ceiling $400 Cost to Produce SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017

12 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. $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 Estimated Price per Course of of Treatment, DAAs for Hepatitis C $69,773 $49,657 $38,186 $20,000 $14,234 $10,946 $4,966 $1,423 $400 AWP AMP 340B, MDRP Nominal Price Cost to Produce Ceiling SOURCE: Based on unpublished Georgia Department of Corrections data, supplied November 2017

13 Ways of Decreasing Price 1. 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 o Recently considered as a potential strategy by Louisiana

14 Nominal Pricing: a Possible Solution for Correctional Facilities Nominal price by definition must be less than 10% of AMP very substantial discount 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

15 Gap in the Marketplace: HCV Therapy Demand Curve

16 Number of Viremic Individuals 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. Number of Persons with Chronic Hepatitis C Hypothetically Treated and Missed under Three Pricing Strategies Average Wholesale Pricing Treated 340B Pricing Not Treated Nominal Pricing Data Source: Georgia Department of Corrections, FY FY 2018

17 Questions? CONTACT I NFO: M ADELI NE A DEE CM P H M ADEE@EMORY. EDU ANNE SPAULDING MD MPH A SPAULD@EMORY. EDU