Last Wednesday, a United States District Court judge issued an injunction against the Centers for Medicare and Medicaid Services’ (CMS) Most Favored Nation drug pricing model for 14 days. The demonstration was set to begin on January 1, but the court ruled that the COVID-19 pandemic emergency was not sufficient to immediately finalize the policy without a comment period.
From U.S. District Court for the District of Maryland Judge Catherine Blake:
An agency may not dispense with notice and comment procedures merely because it wishes to implement what it sees as a beneficial regulation immediately… The rule at issue threatens not just to harm the livelihoods of healthcare providers but also to shutter the community-based healthcare facilities, without which many patients may have to travel long distances to obtain medical care.
CMS announced the new payment model on November 20, after a year and a half of stagnation in the Trump Administration docket. The agency moved ahead with an Interim Final Rule, which dodged the traditional public comment and response period for review of the rule.
According to CMS, the Most Favored Nation rule is aimed to lower prescription drug costs by paying no more for Medicare Part B pharmaceuticals than the lowest drug price that manufacturers receive from other developed nations.
The Pharmaceutical Research and Manufacturers of America (PhRMA) sued the Trump administration about the rule, joined by the Association of Community Cancer Centers, the Global Colon Cancer Association and the National Infusion Center Association, according to Inside Health Policy. This coalition requested that the court provide a preliminary injunction as well as a restraining order against the plan to tie drug prices to overseas prices.
From Sue Peschin, the Alliance for Aging Research, via PR Newswire:
The Most Favored Nation rule would have an immediate and negative impact on Medicare Part B beneficiaries’ access to therapeutics for terminal cancers, vision loss and other serious illnesses. The Alliance thanks U.S. District Judge Catherine Blake for her expedited decision, given that the U.S. Health and Human Services was trying to bypass notice and comment procedures required under the Administrative Procedures Act. We hope to see the rule enjoined permanently in Early January.
Modern Healthcare Reports this was one of several lawsuits filed against the policy, and the Alliance for Aging Research filed an amicus curiae in one such similar lawsuit in the U.S. District Court for the Northern District of California.
Judge Blake specifically mentioned the multiple sclerosis (MS) drug Ocrevus as one that could potentially cause harm to patients, if prices were adjusted under the rule. Ocrevus is the only approved therapy to treat MS, and the plaintiffs stated that the model would make it “economically impossible” to continue infusing Ocrevus. Blake said that this type of complaint is a concrete example by which the demo would likely cause harm and supported the requirement for a delay to continue the rulemaking process.
Judge Blake is now reviewing a request for a preliminary injunction that would delay the model from going into effect after the restraining order expires.