End the IRA’s Innovation-Killing “Big Payor” Bailout

  • by: Peter Pitts |
  • 01/28/2025
GLP-1 drugs (Ozempic, Wegovy, Zepbound, etc.) have important therapeutic potential beyond weight loss. According to a new Pharmacy Practice in Focus article, “Since their original entry into the market, GLP-1 receptor agonists have gained FDA approval and have established significant roles in therapy for cardiovascular disease, obesity, and kidney disease. Interestingly, emerging data suggest that this class of medications may have roles in other—somewhat unrelated—conditions.”

These “unrelated” conditions include Parkinson’s Disease, Alzheimer’s Disease, osteoarthritis, gambling addiction, and chemical dependencies. To say GLP-1 drugs have potential beyond weight loss is an understatement. But there haven’t been any large-scale studies to move beyond the exciting (but limited) anecdotal data – and the plural of anecdote isn’t data. Without solid data, the FDA can’t add any of these potentially groundbreaking secondary indications to the official product label.

(In regulatory parlance, “secondary indications” come after the primary indications granted when a drug is initially approved by the FDA.)

Why does this matter? Because unless these “secondary indications” are more intensely studied, and the data reviewed and vetted by the FDA, physicians will be rightfully skeptical and insurance companies unlikely to reimburse patients for what they consider suspicious off-label use. And rightfully so.

With such exciting potential, why aren’t the expensive large-scale clinical trials that would move these new therapeutic opportunities moving forward at warp speed? One troubling answer is an unintended (but entirely predictable) codicil of the Inflation Reduction Act, specifically, the IRA’s blunt language that says that any “negotiated” price covers all indications current or future. In blunt terms, the IRA is saying to drug developers, “You will not be rewarded for investing in any new important science.” This predictable stifling of innovation cannot and must not stand.

The pharmaceutical industry recognizes this problem. Patients and disease organization do too. And you can add to that physicians who read about the potential – but are left wondering where the data are that will better inform these new and exciting use indications. Everyone is waiting.

Well, not everyone. There’s been a strange and uncomfortable silence from a major player in American health care – the insurance companies. While “Big Pharma” regularly face the wrath of pundits and politicians, “Big Payor” seems to get a pass. And it’s not unreasonable to conclude the reason -- they don’t want to pay for important new GLP-1 indications.

That’s craven. The Big Insurance Bailout must end – and a good place to start is by amending the IRA’s inexcusable, unnecessary, and dangerous innovation-penalty.
 
CMPI

Center for Medicine in the Public Interest is a nonprofit, non-partisan organization promoting innovative solutions that advance medical progress, reduce health disparities, extend life and make health care more affordable, preventive and patient-centered. CMPI also provides the public, policymakers and the media a reliable source of independent scientific analysis on issues ranging from personalized medicine, food and drug safety, health care reform and comparative effectiveness.

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