28 November 2018 - The latest proposal from the U.S. CMS to let insurers use step therapies, or to drop protections on certain classes of drugs if price increases outpace inflation, may harm a wider circle of drug makers, ranging from GlaxoSmithKline to Gilead.

Amgen, Regeneron Pharmaceuticals and Roche are often cited as the drug makers having the most to lose in proposed changes to Medicare. Regeneron’s Eylea, Roche’s Avastin and Amgen’s franchise of blood boosters get a good part of their revenue from sales under Medicare. Yesterday’s CMS proposal would leave HIV therapies as well as antidepressants and cancer treatments unprotected.

Gilead and Glaxo, as the top HIV manufacturers, as well as makers of anti-depressants and antipsychotics like AstraZeneca, Pfizer, Allergan, Bausch Health, Lilly and Otsuka may face new challenges and may be deterred from price hikes, Height analyst Andrea Harris wrote in a note to clients. Harris predicts “a fairly modest impact on drug manufacturers and Medicare plan sponsors” overall and says the final rule, expected by April, will likely differ from the proposal.

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