Cost Effectiveness of the 15 Drugs Selected for IPAY 2027 CMS Drug Price Negotiation.

Objective: To analyze published cost-effectiveness analyses (CEAs) for the 15 drugs selected for the Initial Price Applicability Year 2027 by the Centers for Medicare and Medicaid Services (CMS).

Methods: We identified CEAs for the 15 drugs from the Tufts Cost-Effectiveness Analysis Registry. For each drug, we included all base-case incremental cost effectiveness ratios (ICERs) and calculated median and interquartile ranges for positive ICERs for each drug-indication. We also performed the analyses on CEAs conducted in the US, which used a lifetime horizon, or were industry-sponsored. We present all costs in 2022 US dollars.

Results: A total of 20 drug-indications were included in the analysis. Most studies employed a non-societal perspective and were industry-sponsored. Median positive ICERs ranged from $1,800 (linagliptin) to $640,000 (acalabrutinib) with six drug-indications having a median ICER below $50,000 and 10 above $100,000. Among the 13 drug-indications with US-based CEAs, 11 had a median ICER near or above $100,000. Among CEAs with a lifetime horizon, seven drug-indications had a median ICER below $50,000 and five above $100,000. CEAs sponsored by industry had median ICERs above $100,000 for five drug indications. The median ICERs differed considerably between the two covered indications for semaglutide, linaclotide, and rifaximin.

Conclusion: As CMS continues to implement its drug price negotiation program, promoting greater transparency and consistency in how value is defined and applied to pricing decisions will be essential. CEA can serve as an important source of evidence, ensuring that negotiated prices more closely reflect the benefits drugs provide.