The U.S. Department of Health and Human Services (HHS) has urged the Supreme Court to shoot down an appeal by Pfizer challenging the U.S. Anti-Kickback Statute (AKS).
The company wants SCOTUS to reconsider a ruling that blocks it from providing rebates to Medicare patients for its pricey heart medications Vyndaqel and Vyndamax.
At issue is whether drugmakers should be allowed to use charity programs to help Medicare D patients afford expensive drugs. In recent years, the government has cracked down on the rebate programs to help rein in Medicare spending.
Two courts have told Pfizer no, citing existing kickbacks law. The company maintains that the government’s interpretation of the statute is “staggeringly overbroad.”
In its most recent petition, Pfizer says that the way the AKS is interpreted, it could be used to prosecute “charitable family members and friends,” who would help patients make their co-payments. In its court filing (PDF), the HHS dismissed the position as “speculative and far-fetched.”
In the case of Pfizer’s Vyndaqel, which costs $225,000 a year, Medicare D patients are responsible for a $13,000 annual co-pay. But with Pfizer’s proposed rebate program, the cost comes to just $35 a month ($420 annually).
The HHS rejected the program in 2019, saying such an arrangement would violate a criminal ban on financial support to patients for a federally reimbursed healthcare product, prompting Pfizer to go to court.
The argument centers on whether the existing anti-kickback law requires an element of corrupt intent for financial support to Medicare patients to be considered illegal. Both the HHS and two lower courts believe ill intent is not needed for such payments to be deemed kickbacks, while Pfizer thinks it is.
In addressing the issue in its Wednesday filing, the HHS said that patient assistance programs require “guardrails.”
“If pharmaceutical manufacturers could subsidize copayments for their own products, they would have an incentive to increase prices, potentially at additional cost to federal health care programs and beneficiaries who are unable to obtain copayment support,” the HHS wrote.
Pfizer argues that the Vyndaqel/Vyndamax case is an ideal vehicle to review the law because it “poses no risk of corrupting independent medical decision-making." That's because the brands are the only ones approved by the FDA to treat transthyretin amyloid cardiomyopathy.
The rare, life-threatening heart disease mainly affects elderly people on Medicare. The company argues that there’s no attempt to seek an advantage over a competitor’s product.