Altarum released projections suggesting that, by the mid-2020s, Aduhelm, approved Aduhelm for treatment of Alzheimer’s disease on June 7 by the U.S. Food and Drug Administration (FDA), will constitute more than 1% of all national health spending, increasing non-retail drug spending by more than 25% and increasing total prescription drug spending by more than 8%.
Additionally, it is projected that doubling the uptake of Aduhelm to two million people – at the higher end of the drug’s manufacturer Biogen estimates of the target population – would double this impact, with Aduhelm’s contribution to NHE increasing to nearly 2.5% and non-retail drug spending increasing by more than 50%.
While Biogen tested it on patients with mild cognitive impairment (of whom there are an estimated one to two million in the U.S.), the FDA approved its use more broadly for the more than six million Americans currently diagnosed with Alzheimer’s. The drug is administered through intravenous infusion at an annual cost of $56,000 per patient – a non-retail expenditure that will be borne primarily by Medicare Part B.
FDA’s decision is controversial both because of the drug’s cost and the limited efficacy demonstrated in the manufacturer’s clinical trials. In this paper, its paper, Altarum addresses the impact of Aduhelm use on non-retail prescription drug expenditures, total prescription drug expenditures, and national health expenditures (NHE) as projected by the Centers for Medicare and Medicaid Services (CMS).
In a previous report, Altarum developed projections of non-retail prescription drug expenditures through 2028 and estimated their share of national health expenditures. In this paper, the company extends those projections to include estimated expenditures on Aduhelm. It considers only spending on the drug itself, excluding additional expenditures associated with facility costs at infusion sites, Medicare payments to prescribing physicians, and testing of patients both for eligibility for receiving the drug and for side effects during its administration.
Biogen has announced that the price of Aduhelm will not increase in the next four years. Altarum data through April 2021 show decline and subsequent recovery in spending on health care services, but less impact on growth in retail drug spending. This could potentially lower the ratio of non-retail to retail drug spending in 2020 and 2021. However, we do not yet know the final impact of the pandemic on actual and projected drug spending and NHE beginning in 2020.