Background

The first round of Medicare drug price negotiation is concluding and maximum fair prices for the first 10 selected Part D drugs will be released by September 1. In parallel, the Centers for Medicare & Medicaid Services (CMS) is preparing to implement changes for initial price applicability year (IPAY) 2027 and beyond.

On July 2, CMS issued an initial Information Collection Request (ICR) detailing the negotiation data elements and drug price negotiation process for Medicare Part D drugs for IPAY 2027. The ICR includes substantial updates to Section I, “Evidence About Alternative Treatments,” of the Negotiation Data Elements Form. These updates likely reflect learnings and feedback from stakeholders during the IPAY 2026 negotiation process and reflect consideration from CMS to incorporate input into future IPAY program elements. The changes increase the scope of requested information from manufacturers and will require refined evidence strategies to ensure optimal preparation.

Key Changes to IPAY 2027 Initial Negotiation Data Elements ICR

CMS greatly expanded Section I, which now includes more than 30 questions organized in categories by the most likely relevant stakeholder, including:

• Manufacturer-Focused Input (Q30–Q37)
• Patient- or Caregiver-Focused Input (Q38–Q44)
• Clinical-Focused Input (Q45–Q51)
• Health Research-Focused Input (Q52–Q58)
• Other Public Input (Q59–Q62)

Although each category has a specific stakeholder listed, CMS emphasizes that these are illustrative, and any interested party can respond to any or all questions in Section I.

In the Manufacturer-Focused Input section, the topics present in the IPAY 2026 ICR and outlined in the Inflation Reduction Act (IRA) statute are retained, including Prescribing Information, Comparative Effectiveness, Therapeutic Advance, Specific Populations, and Unmet Medical Need. While these topics remain consistent, many questions have been split into multiple sub-questions, and the overall word count for responses has been increased. CMS has also added questions asking respondents to identify therapeutic alternatives; provide Medicare-specific disease prevalence, treatment utilization, and healthcare resource utilization (HCRU) data; present patient experience data; and submit an evidence dossier to complement Section I responses. Lastly, CMS specifies that it “prefers publicly available, peer reviewed literature” and “reserves the right to review submitted materials for relevance.”

Evidence Requested in Section I of the IPAY 2027 Initial ICR

For each indication, manufacturers can now submit evidence on:

• Relevant Therapeutic Alternatives
• Use in Clinical Care & Relevant Clinical Outcomes
• Clinical Comparative Effectiveness
• Medicare-specific Indication Prevalence
• Medicare-specific Drug Utilization
• Medicare-specific Healthcare Resource Utilization
• Therapeutic Advance versus Alternatives
• Addressing Unmet Medical Need
• Impact on Specific Populations of Interest
• Patient Experience, Preferences, and Disease Burden
• Health Equity, Access, and SDOH Considerations

To further support responses to each of the ICR questions, manufacturers can also submit:

• IRA-Specific Evidence Dossier
• Visual Representations (e.g., tables, charts, graphs)

Impact on Manufacturers’ Evidence Planning & Packaging

Ultimately, these changes have mixed implications for manufacturers. The evidence requested in the ICR has notably increased, resulting in greater resource demands during ICR response preparation. CMS’s specified preference for peer-reviewed literature may require additional dissemination to ensure evidence submitted is in the public domain before negotiation. Manufacturers will likely need to dedicate more resources towards ICR response submission activities and begin these activities sooner than previously planned. Further, the newly requested Medicare-specific prevalence, utilization, and HCRU data will likely require new evidence generation and subsequent publication. Manufacturers should look for opportunities to efficiently generate evidence that fills existing gaps, for example by conducting a Medicare-specific real-world evidence study across a range of outcomes and comparators relevant to negotiation.

Despite the increased effort, these ICR updates bring greater opportunities to communicate a cohesive and effective treatment value story tailored specifically to CMS. The opportunity to submit an evidence dossier is a new avenue to facilitate effective communication about the existing evidence base for a product. The dossier can be used as a tool to complement the value narrative throughout the ICR questions and should be strategically designed to ensure relevance and impact to CMS. The new organization of the ICR is more straightforward and reduces ambiguity around where specific information should be submitted. This should assist manufacturers in the development of the ICR response, particularly as it pertains to the data and evidence appropriate for each question.

Key Takeaways

This ICR is open to public comments through September 3, after which CMS will review and release a revised version in Fall 2024. While CMS may implement changes to the document following public comment, it is important that manufacturers with direct or competitor impacts in the next round of negotiation begin early evidence preparation according to this ICR. Necessary activities may include:

• Assessing the existing evidence base, particularly from a CMS lens
• Developing CMS-specific product value messaging
• Preparing an IRA-specific dossier to complement ICR response submission

For those with expected negotiation or competitor impacts in IPAY 2028 and beyond, there are greater opportunities to revamp evidence strategies to optimize negotiation outcomes. This may include:

• Conducting an evidence gaps analysis and feasibility assessment to fill those gaps with meaningful evidence generation
• Revising early lifecycle evidence planning to account for and integrate negotiation-related evidence needs
• Developing and executing an evidence publication strategy that introduces meaningful evidence into the public domain

A Trusted Partner for CMS Engagement

IRA will continue to have wide-reaching impacts across the prescription drug market. An effective IRA negotiation response strategy requires evidence planning informed by a CMS negotiation evaluation lens. With expertise in policy, evidence generation and strategy, and market access, Avalere’s multidisciplinary team can help manufacturers effectively respond to these new evidence needs. Connect with us to learn more.