Medicare will price one-dose gene therapies as 12 months

CMS will count a Part B drug given once, such as a gene therapy, as 12 thirty-day supplies when it sets prices in Medicare drug negotiation. The agency finalized that convention in its Nov. 5 final rule, CMS-4215-F. The rule publishes in the Federal Register on Nov. 9 and takes effect Dec. 5.

The provision covers any selected drug, and any therapeutic alternative, that Part B pays for and that patients typically receive one time. The rule names some vaccines, gene therapies and cancer therapies as examples. CMS finds these drugs through billing codes that generally show a median of one claim per calendar year. Such drugs “are typically administered once for the lifetime of a patient,” CMS wrote, so its usual method, which measures the days between doses, has no second dose to measure.

Why it matters: the 12 sets how CMS lines up a single dose against drugs patients take every day or every month. That comparison feeds the ceiling price and CMS’s initial offer. Gene therapy makers, Medicare Advantage plans and health systems that buy and bill these products now know the conversion CMS will use.

How the 12 works

CMS converts every selected drug into a cost per 30-day equivalent supply. It uses that unit to set one ceiling price, and to make offers and counteroffers, across all dosage forms and strengths. Assigning 12 to a one-time drug spreads its price across 12 monthly units. The result can then sit next to a pill taken daily or an infusion given every few weeks.

CMS said it reviews use within a one-year window, so 12 “represents the maximum value possible in the calculation.” The value “accurately captures and covers a full year and allows comparison to drugs that may be administered multiple times within a year’s timeframe,” the agency wrote.

Part B drugs entered the program with the 2028 cycle, when CMS could first pick drugs from Part B as well as Part D. CMS chose 15 drugs for 2028 and can pick up to 20 a year from 2029, the first cycle this rule governs.

What drugmakers asked for

“Many commenters opposed” the value of 12, the rule says. Some asked for a more tailored method. One asked for an outlier policy. A couple of commenters said the convention “systematically misvalues therapies whose clinical benefit is decoupled from a monthly dosing.” Pink Sheet reported Nov. 6 that industry said the approach makes durable cures look far more expensive.

CMS kept the rule as proposed, with one technical title change. It also rejected pricing these drugs per administration or per billing unit. CMS said one price per administration across several billing codes may not fit, could block comparison with alternatives that Part B does not pay for or that patients take daily, and would ignore different volumes used per dose.

What it means for payers

The conversion is set for 2029, but CMS has not closed the question. The agency wrote that it is “still considering an outlier policy for future rulemaking” and asked for input. A future outlier rule is where the treatment of cures that pay off over many years gets decided.

Medicaid is on a separate track. CMS is opening its Cell and Gene Therapy Access Model, so far limited to sickle cell disease, to other cell and gene therapies. The negotiation rule also sets a temporary price floor for small biotech drugs in 2029 and 2030.