The Aduhelm Controversy

I suspect by now that everyone has read or heard something about Aduhelm. Aduhelm is the very expensive new Alzheimer’s drug which was ultimately approved by the Food and Drug Administration (FDA) but the review process was mired in controversy. The controversy continued with the decision to only have Medicare cover the drug for patients in clinical trials, vastly restricting its availability. Apparently, this is the first time the FDA has approved a drug which then Medicare approved for reimbursement in such a narrow manner.

The drug was originally priced at $58,000 per year and then reduced to $28,200. After the Medicare decision to limit reimbursement, the stock price of Biogen, the company which developed the drug, plummeted and the CEO resigned.

It is reported that half of the 2022 Medicare Part B premium increase, a relatively significant 14.5% over the 2021 premium, was due to Medicare accounting for the original price tag of Aduhelm. Now that the cost of Aduhelm has been reduced and the availability of its coverage restricted, there has been speculation about an adjustment to the Medicare Part B premium but that would be a major undertaking to implement midyear. We’ll be waiting for the announcement of 2023 Medicare Part B premiums. It is possible they will be reduced. We’ll see.

An interesting op-ed piece in the Wall Street Journal characterized the CEO’s resignation as a “casualty of the left’s crusade against high drug prices.” Earlier in the piece the writer suggests that The Centers for Medicare and Medicaid Services’ decision on Medicare reimbursement means that “Most patients will have to pay $28,200 a year out of pocket.” Let’s be realistic. Very few patients outside of the clinical trials will be taking Aduhelm with such a high out-of-pocket cost.

I am not an expert in these matters but common sense suggests it is not helpful to conclude that this is primarily a political issue when so many experts question the effectiveness of the drug. A simple internet search shows that the United Arab Emirates is the only other country in the world that has approved Aduhelm. It will be very interesting to see what other countries decide in terms of how to cover Aduhelm and how to limit its availability.