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Skepticism may be warranted when the Centers for Medicare and Medicaid Services’ Office of the Actuary says Medicare could spend as much as $3.5 billion on the Alzheimer’s disease drug Leqembi (lecanemab) in 2025. Even CMS’s projected cost to Medicare of $550 million for Leqembi in 2024 appears to be off base.
There were several explicitly stated assumptions made by CMS in its recent assessment of the cost of Medicare coverage of Leqembi. Perhaps the most conspicuous was presuming that a certain percentage of the eligible population of early Alzheimer’s disease patients would necessarily become actual users of the product, in spite of limited effectiveness and safety concerns around brain bleeding and swelling.
To arrive at the estimates, CMS considered a number of public sources, including a paper in the Journal of the American Medical Association which estimated the potential future Medicare spending and beneficiary costs for lecanemab based on an extrapolation of the numbers of early Alzheimer’s disease patients from a 2018 health and retirement study.
Furthermore, public statements from the manufacturers of Leqembi, Eisai and Biogen, suggested that as many as 100,000 patients would be “diagnosed as eligible” for treatment by 2026.
Inferring from the numbers of diagnosed patients, CMS predicted 55,875 users for 2024. However, that’s not in line with the reality of comparatively meager revenues for Leqembi thus far. According to Endpoints News, total global sales of Leqembi were about $19 million in the first quarter of this year. While numbers of patients being prescribed the drug are increasing—first quarter sales in 2024 tripled compared to the fourth quarter of last year— at $19 million it’s hard to envision it rapidly becoming the blockbuster Medicare expects it will be. Fierce Pharma reported that as of late January merely 2,000 patients were taking the medicine nationwide, which indicated the sponsors would fall short of the goal they set of having 10,000 on the drug by the end of March.
CMS’s forecast assumes market penetration based on (percentages of) numbers of patients eligible for Leqembi. However, just because a particular number of patients are diagnosed with early Alzheimer’s disease does not necessarily mean that a corresponding (projected) percentage of these individuals will be prescribed Leqembi or another monoclonal antibody like it that targets beta amyloid plaque build-up in the brain. Plaque accretion is hypothesized to be a cause of Alzheimer’s.
It’s also important to note that CMS estimates are well beyond what the drug’s sponsors, Eisai and Biogen, have forecast, as an article in STAT News detailed last month.
Undoubtedly, Alzheimer's disease therapeutics and corresponding diagnostics could turn out to be a budget breaker for Medicare, if these products gain a lot of traction. So far, none have.
Aduhelm Saga
It’s worth revisiting what CMS and others, including KFF, appeared to believe would happen when the first beta amyloid-directed monoclonal antibody indicated for Alzheimer’s disease, Aduhelm (aducanumab), was approved in 2021: Namely, rapid adoption that would result in a substantial budgetary impact for the Medicare program. In turn this would entail the need to increase Medicare Part B premiums. Part B includes physician-administered injectables, such as Aduhelm.
One can’t fault CMS or any other entity for thinking this way based on what researchers were saying. An article in JAMA submitted that if 500,000 beneficiaries would be prescribed Aduhelm and Medicare pays 103% of the annual wholesale acquisition cost of Aduhelm of $56,000 total spending for Aduhelm in one year alone would be nearly $29 billion.
The assumption was that between 25% and 50% of the total eligible population would take the drug.
Prior to the release of the national coverage determination for beta amyloid-directed monoclonal antibodies in April 2022 and the drop in price of Aduhelm to $28,000, CMS announced a 14.5% hike in the Medicare Part B premium.
Aduhelm experienced extremely poor uptake in both the public and commercial markets. In the fourth quarter of 2021, for example, Aduhelm could only muster $1 million in sales. Since then, prospects for the biologic didn’t appreciably improve.
The drug’s manufacturer Biogen subsequently said it would “reprioritize resources allocated to Aduhelm to advance Leqembi and to develop new treatment modalities.”
A muddled regulatory history as well as little proven efficacy and considerable safety risks doomed Aduhelm. And this meant that Medicare had grossly overestimated the product’s uptake.
In 2022, Department of Health and Human Services Secretary Xavier Becerra announced that Medicare Part B premiums paid by Medicare beneficiaries would be adjusted downward to account for the overestimate in costs.
Why Uptake Of Leqembi May Be Limited
Similar to Aduhelm, Leqembi is a biologic that reduces plaque accumulation in the brain thought to be a contributing factor in Alzheimer’s disease. Biogen and Eisai are co-sponsors of Leqembi, which was granted accelerated and then full approval by the FDA in January and July 2023, respectively.
Phase 3 data for Leqembi demonstrated a modest lessening of cognitive deterioration in patients with early Alzheimer’s disease. At the Clinical Trials on Alzheimer’s Disease Congress in December 2022, trial investigators presented a full data analysis on Leqembi’s safety and efficacy. The findings published in the New England Journal of Medicine made experts optimistic and cautious at the same time, which was reflected in the medical journal article’s conclusion that the drug should be studied further.
Leqembi offers some degree of hope to Alzheimer’s disease patients. It is not Aduhelm redux. Accordingly, there’s been moderately rising demand for the drug since its July 2023 approval. Nonetheless, the therapeutic hasn’t nearly gathered the kind of momentum that would indicate an imminent blockbuster status.
And while underwhelming demand is a factor, MedPage Today reports that hospitals and health systems have also required more time than expected to set up their infusion systems for delivering the drug to patients.
Eisai and Biogen are planning to seek approval for a self-injectable version of Leqembi that would be easier for patients to use. This could lead to more takers. Further, blood tests in lieu of brain scans may eventually speed up amyloid plaque detection.
In addition, the FDA is reviewing another treatment that targets amyloid protein, Eli Lilly's donanemab, which is expected to be approved later this year. Eventually this could bolster demand for the therapeutic class of plaque-busting biologics as a whole.
However, physicians and patients have lingering questions pertaining to all these medications, some of which are related to safety issues while others concern whether the treatments provide clinically meaningfully reduction of cognitive decline in patients. This has led to there not being a consensus among neurologists on whether to recommend Leqembi to their patients.
For example, while trials have shown that Leqembi slows the cognitive impairment associated with Alzheimer’s, its benefits are considered modest, perhaps too slight for some to perceive a benefit. There are also persistent safety worries.
All things considered, while Medicare projects it will spend $3.5 billion on Leqembi next year this is highly unlikely.
