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The Obscure Drug With a Growing Medicare Tab

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Posted on Aug 5, 2014

By Charles Ornstein, ProPublica

    A gel used to treat multiple sclerosis relapses and a rare kidney disease is costing Medicare millions, despite questions about its effectiveness. Shutterstock

This story was co-published by ProPublica and The New York Times’ The Upshot.

An obscure injectable medication made from pigs’ pituitary glands has surged up the list of drugs that cost Medicare the most money, taking a growing bite out of the program’s resources.

Medicare’s tab for the medication, H.P. Acthar Gel, jumped twentyfold from 2008 to 2012, reaching $141.5 million, according to Medicare prescribing data requested by ProPublica. The bill for 2013 is likely to be even higher, exceeding $220 million.

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Acthar’s explosive growth illustrates how Medicare’s prescription drug program — perhaps more than private health insurers and even other public health programs — is struggling to contain the taxpayer burden of expensive therapies aimed at rare conditions.

Many outside experts say there’s insufficient evidence that the drug works better than much cheaper options for treating multiple sclerosis relapses and a rare kidney disease, conditions for which it is often prescribed. In the absence of such scientific studies, some private health insurance companies, as well as Tricare, the military’s health care program, have curtailed or eliminated spending on Acthar. Proponents of the drug say it is a worthy option for patients who have failed on other therapies.

But Medicare has imposed no limits, leaving such decisions to the private insurers paid to administer its drug program on the government’s behalf. Medicare accounted for around a quarter of Questcor Pharmaceuticals’s sales of Acthar in 2012 — and that proportion is growing.

Medicare cannot bar access to medications like Acthar, even in the face of rising expense and questions about efficacy, Aaron Albright, a spokesman for the Centers for Medicare and Medicaid Services, said in a written statement. The law mandates that Medicare’s drug program, known as Part D, cover drugs for the uses authorized by the Food and Drug Administration, he said.

Since Acthar came on the market in 1952, the rules about F.D.A. approval have changed. At the time, drug companies simply had to demonstrate that a drug was safe, rather than that it was effective. Acthar was initially authorized as a treatment for more than 50 diseases and conditions. (The list has since been cut to 19.)

Acthar isn’t prescribed often, just 3,387 times in Medicare in 2012. But Part D spent an average of $41,763 per prescription, making it one of the most expensive drugs around.

The drug ranked 139th that year, in terms of total cost, out of more than 3,000 drugs prescribed in Medicare. In 2008, it ranked around 660th.

Several of the top prescribers of Acthar have financial ties to the drug’s maker, Questcor. These doctors typically receive research grants, payments for delivering speeches on behalf of the company or compensation for serving on advisory boards.

But some in the medical community say the program’s soaring bill for Acthar shows Medicare needs to do more to safeguard taxpayer dollars.

Dr. Lily Jung Henson, medical director of neurology at Swedish Medical Center’s Ballard campus in Seattle, said she rarely prescribes Acthar for her multiple sclerosis patients. Medicare, she said, should at least push for more studies to determine whether Acthar works.

She said of her patients, “I certainly prescribe enough expensive drugs to them that I think are worthwhile, that I can’t afford to waste their money by giving them a drug that I can’t convince myself has been effective.”


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