Medicare Spending on Orphan Drugs With Single and Multiple Rare Disease Indications
Author(s)
Genevieve Lyons, MSc1, Yaena Min, PhD2, Linh Tran, PhD2, Andrew Messali, PharmD, PhD1, Tope Olufade, BS, MPH, PhD3, Jay Eberle, MPS4, Lisa Feng, DrPH5;
1Alexion, AstraZeneca Rare Disease, Boston, MA, USA, 2Health Management Associates, Washington, DC, USA, 3AstraZeneca, Wilmington, DE, USA, 4AstraZeneca, Washington, DC, USA, 5Alexion, AstraZeneca Rare Disease, Washington, DC, USA
1Alexion, AstraZeneca Rare Disease, Boston, MA, USA, 2Health Management Associates, Washington, DC, USA, 3AstraZeneca, Wilmington, DE, USA, 4AstraZeneca, Washington, DC, USA, 5Alexion, AstraZeneca Rare Disease, Washington, DC, USA
Presentation Documents
OBJECTIVES: The Inflation Reduction Act (IRA), passed in 2022, allows the Centers for Medicare & Medicaid Services (CMS) to negotiate "maximum fair prices" for certain prescription drugs covered in the Medicare Drug Price Negotiation Program. Orphan drugs are excluded from negotiation, but only if they treat a single indication. This study aims to assess the proportion of Medicare expenditures for orphan drugs and stratify by those with exclusively rare disease indications compared to those with some non-rare disease indications.
METHODS: We categorized drugs into the following groups: (1) Single Orphans: orphan drugs that have a single indication, (2) Multi-Rare Orphans: orphan drugs with multiple indications where all are rare diseases, (3) Multi-Non-Rare Orphans: orphan drugs with multiple indications where some are non-rare diseases, and (4) Non-Orphan Drugs. Using the 100% Medicare Part B Fee-For-Service (FFS) claims data and Medicare Part D claims data in 2022, we assessed the proportion of total Medicare Part B and D drug and medical spend that is associated with orphan drugs in each of these categories.
RESULTS: Out of 8,842 drugs analyzed, 3.7% (N=324) were Single Orphans, 0.9% (N=82) were Multi-Rare Orphans, 2.6% (N=233) were Multi-Non-Rare Orphans, and 92.8% (N=8,203) were Non-Orphan Drugs. In 2022, the drug spend associated with Medicare Part B (FFS) and D was $286.69 billion. Multi-Rare Orphans constituted 3.2% of total Part B (FFS) and Part D Medicare spend and 5.4% of Part B (FFS) and Part D drug spend. By contrast, Multi-Non-Rare Orphans constituted 11.6% of total Medicare spend and 19.5% of the drug spend. Single Orphans constituted 4.5% of total Medicare spend and 7.5% of the drug spend.
CONCLUSIONS: Spending on Orphan Drugs in Medicare Part B and Part D was concentrated primarily in Multi-Non-Rare Orphans and not in Multi-Rare Orphans.
METHODS: We categorized drugs into the following groups: (1) Single Orphans: orphan drugs that have a single indication, (2) Multi-Rare Orphans: orphan drugs with multiple indications where all are rare diseases, (3) Multi-Non-Rare Orphans: orphan drugs with multiple indications where some are non-rare diseases, and (4) Non-Orphan Drugs. Using the 100% Medicare Part B Fee-For-Service (FFS) claims data and Medicare Part D claims data in 2022, we assessed the proportion of total Medicare Part B and D drug and medical spend that is associated with orphan drugs in each of these categories.
RESULTS: Out of 8,842 drugs analyzed, 3.7% (N=324) were Single Orphans, 0.9% (N=82) were Multi-Rare Orphans, 2.6% (N=233) were Multi-Non-Rare Orphans, and 92.8% (N=8,203) were Non-Orphan Drugs. In 2022, the drug spend associated with Medicare Part B (FFS) and D was $286.69 billion. Multi-Rare Orphans constituted 3.2% of total Part B (FFS) and Part D Medicare spend and 5.4% of Part B (FFS) and Part D drug spend. By contrast, Multi-Non-Rare Orphans constituted 11.6% of total Medicare spend and 19.5% of the drug spend. Single Orphans constituted 4.5% of total Medicare spend and 7.5% of the drug spend.
CONCLUSIONS: Spending on Orphan Drugs in Medicare Part B and Part D was concentrated primarily in Multi-Non-Rare Orphans and not in Multi-Rare Orphans.
Conference/Value in Health Info
2025-05, ISPOR 2025, Montréal, Quebec, CA
Value in Health, Volume 28, Issue S1
Code
HPR145
Topic
Health Policy & Regulatory
Topic Subcategory
Public Spending & National Health Expenditures, Reimbursement & Access Policy
Disease
No Additional Disease & Conditions/Specialized Treatment Areas, SDC: Rare & Orphan Diseases