Wednesday, May 8, 2019

Very Brief Blog: HHS Finalizes Rule to Require Drug Prices in TV Ads

Last fall, HHS announced a number of possible initiatives regarding drug prices, including requiring prices in TV ads and linking US CMS prices to European prices (via a CMMI demonstration).

On May 8, 2019, CMS finalized the rule requiring TV ads for drugs (costing >$35) to include WAC prices for either "30 days" or "a typical course of treatment."
  • Endpoints blog here.
  • Federal Register webpage here.
  • Early copy of rule here. (CMS-4187-F, modifying 42 CFR 403.1200ff.)
    • Original proposal here.
    • Discussion at Foley Hoag, here.
The regulation does not include any direct penalties, but Endpoints notes that CMS proposes that other companies might sue a non-compliant scofflaw company under the Lanham Act.   ("We anticipate that the primary enforcement mechanism will be the threat of private actions under the Lanham Act...")

The regulation contains a clause over-riding state or city laws that attempted to be either more stringent or more lenient than this regulation:
No State or political subdivision of any State may establish or continue in effect any requirement concerning the disclosure in a television advertisement of the pricing of a prescription drug or biological product which is different from, or in addition to, any requirement imposed by this subpart. 403.1204(b).

They mention that CMS doesn't have explicit authority to regulate drug price TV advertising.  ("Many commenters stated that the proposal is beyond the authority of CMS to promulgate these regulations under a reasonable interpretation of sections 1102 and 1871 of the Social Security Act...")   For that matter, CMS staff also don't have explicit authority to regulate what States do (states rights!) regarding drug price advertising.

CMS notes in discussion they considered making a special carve-out counseling code payable when the physician discusses drug pricing with patients.  They deferred action for now.  Someone commented that were such a code to be created, it should be available to pharmacists also.


For a May 2019 article in Health Affairs on Euro reference pricing for Medicare - Yang et al., here.  And for Pharma pushback to international reference pricing, Stat-Plus here.