BIO Notebook: MFN Pricing, Next-Gen Obesity R&D, FDA’s Rare Disease Hub & Reaction To Review Program

MFN Drug Pricing Unlikely To Be A Widespread Near-Term Threat

BIO attempted to offer some insight into the Trump Administration’s plan to institute most favored nation (MFN) drug pricing, which requires US drug prices to match lower ex-US pricing, but panelists agreed on June 18 that the yet-undefined MFN plan’s impacts are unlikely to have a major impact on drug makers in the near term.

“I think President Trump at his core aims for the populist appeal and his aim is very much, I think, to create some sort of storm here to get manufacturers to lower prices for products that are actually meaningful to the American population,” BCR Group vice president Raghav Aggarwal said. “And it’s not just reducing the cost for American consumers, but it’s also about reducing the cost for the government payers and payers across all channels.”

Aggarwal added that Trump “really wants to see a reduction in price in the United States and to do it in a meaningful enough way where he can claim victory over something that has a broad appeal. Prescription drug prices, clearly, is something that’s really important to voters out there. And that’s what he’s trying to sort of show, that he’s actually impacting prescription drug prices in a more meaningful way than even President Biden did through the Inflation Reduction Act.”

However, Health Policy Strategies principal Jayson Slotnik noted, the Congressional Research Service (CRS) issued a report two weeks ago that outlined the Trump Administration’s limited power to implement an MFN pricing requirement. The CRS report said the plan could only be implemented through a demonstration project through the Center for Medicare and Medicaid Innovation (CMMI) or under section 402 of the Social Security Act, both of which would be limited in scope and would not apply to commercial payers.

Aggarwal said the Trump Administration likely is aware of its limited authority, which is why the Administration since Trump issued his executive order on the matter on May 12 has asked manufacturers to voluntarily propose MFN prices for their drugs. The Administration provided updated language on its plan on May 20, linking MFN pricing to the lowest available price in Organization for Economic Cooperation and Development (OECD) countries.

“They know that they don’t have the ability to impose, so they want manufacturers to come to the table and voluntarily apply the MFN pricing,” Aggarwal said. “To the extent that manufacturers have engaged thus far, they’re not necessarily bringing to the table the price offers, but the ones that have are maybe focused on some of the products that don’t have as big of a market as some of their other products or where there is additional competition, which MFN level pricing might actually help with utilization or uptake of their product compared to their competitors.”

AstraZeneca’s Makar On The Case For Next-Gen Obesity Drugs

AstraZeneca’s Mina Makar, SVP of the company’s global cardiovascular, renal and metabolism (CVRM) business unit, described the case that drug developers will have to make to health care payers for next-generation obesity therapies during a June 18 session at BIO.

Makar noted that AstraZeneca’s CVRM strategy is focused on protecting the heart and the kidney from major risk factors – dyslipidemia, hypertension, diabetes and obesity – that accelerate the decline of those organs. “And we’re developing molecules and products that work within each of them, but also in combination across them,” he said.

In obesity, specifically, AstraZeneca is focused on simplifying access to its medicines globally while providing weight management that helps protect the heart and the kidney, while managing the risks of hypertension, dyslipidemia and diabetes. “And that’s why we’re really focused within weight management now on [an oral] small molecule … GLP-1, for example,” Makar said. “We’re focused on creating fixed-dose combinations.”

The company’s oral small molecule GLP-1 agonist AZD5004 is in Phase IIb for obesity and type 2 diabetes, while its GLP-1/glucagon agonist AZD9550 recently moved into Phase IIb in combination with the selective amylin agonist AZD6234 for obesity. AZD6234 monotherapy is in Phase II for obesity. Combinations also are envisioned with AstraZeneca’s SGLT2 inhibitor Farxiga (dapagliflozin), which is approved for type 2 diabetes, heart failure and chronic kidney disease.

“Combining our oral GLP-1 with Farxiga … you’re literally protecting the kidney and the heart and [atherosclerotic cardiovascular disease (ASCVD)] and weight – multiple risk factors and multiple organ protection in a single daily tablet,” Makar said, noting that the company’s obesity strategy also aims to reduce gastrointestinal side effects that make the tolerability of first-generation GLP-1-based treatments challenging.

“I think that’s where the science is going,” he said. “You see that’s where payers are moving in terms of reimbursement. [Medicare and Medicaid] wants to reimburse as show me the protection of the organs, show me the additional risk you’re reducing in addition to the weight. And I think that is a part of chronic therapy that you’re going to see in the next decade. The science is going to be incredible there.”

FDA’s Rare Disease Hub Needs Dedicated Resources For Continued Success

The US Food and Drug Administration’s new Rare Disease Innovation Hub needs dedicated resources moving forward in order to achieve its goals, director Amy Comstock Rick said in a June 18 fireside chat at BIO.

The hub began by borrowing resources from various parts of the agency, primarily the Center for Drug Evaluation and Research and the Center for Biological Evaluation and Research but that is not a long-term solution, Rick said.

“We will have to address the reality that if the hub remains without resources, it’s unlikely that it will be able to achieve the success it’s looking for and intended to have, because one needs resources,” Rick said. “But at the moment, I have an amazing group who have been loaned and we’re plugging away.”

The hub is envisioned to function like an agency center of excellence and create unified and consistent rare disease policy across the agency’s various centers.

One of the hub’s three goals for the year, a review of rare educational materials, is largely on hold due to the lack of resources, Rick said. This review was designed to look at materials intended for sponsors, patients and advocacy organizations to address any redundancies and gaps in needed advice and fill in those holes.

The hub is trying to complete part of the goal, a look at some CDER materials, “but the broader review really requires a level of resources and expertise … that is beyond what we have now,” Rick said.

Despite the funding challenges, Rick was optimistic that the hub aligns with the Trump Administration’s agenda and will be prioritized.

“I will say that the mission for the hub, in terms of centralization, efficiency, focusing on innovation and your patient, those goals are very aligned with the goals of the new administration,” she said. “So I view, in spite of changes, and as any elections bring changes, I view the new administration as an opportunity for the hub to really blossom and to focus on the issues it’s intended to focus on.”

New FDA Voucher Program Offers Positives, But Also Drawbacks

The US FDA’s new Commissioner’s National Priority Review Voucher (CNPV) program aims to significantly speed up review times for qualifying sponsors. But it has drawn mixed reactions, with analysts saying that while it could create incentives for innovative therapies and ease some concerns among investors about the agency overall, it could also reduce the value of existing voucher programs.

The program will cut review times for drug candidates that address certain “national priorities” from the customary 10 months to one to two months, including by undergoing chemistry, manufacturing and controls review while Phase III trials are underway. The program, announced June 17, is separate and distinct from the existing priority review voucher (PRV) programs, which themselves can cut review times down to four to six months.

In a same-day note, Jefferies analyst Michael Yee said that the program “incentivizes development of innovative therapies and … should ease investor concerns about the FDA,” while also seeming “focused on addressing unmet needs + rewarding domestic investment/manufacturing.” In turn, Yee said, it could provide a better incentive for encouraging domestic manufacturing than tariffs.

But some analysts see drawbacks as well. Raymond James analyst Chris Meekins agreed that the new program seems to be a “carrot” to entice companies to fulfill its priorities like domestic manufacturing and lowering drug prices. But he said a likely consequence of the CNPV program is that it will decrease the value of the PRV programs, including those for rare pediatric diseases, medical countermeasures and tropical diseases.

“FDA’s staff is already reduced, so one does wonder if these new vouchers would result in delays to non-PRV products,” Meekins said. “For companies able to gain favor with FDA and receive one of these new vouchers, it is a positive; we just wonder what it will cost them to get to that point.”

In an interview at BIO, BIO CEO John Crowley commented that “anything that reduces the time, the cost, the uncertainty of drug development,” has a tangible benefit for industry. “The cost of capital goes down and more capital comes in.”

Crowley credited FDA leadership for listening to innovators, “breaking down ... bureaucracies, redundancies, being more efficient, using technologies like AI to speed development, all while holding to the gold standard of safety and efficacy, effectively modernizing the FDA and there we’re encouraged.”

“There was a lot more uncertainty, I’d say, two months ago, three months ago,” Crowley added. “I feel, though, that we’re in a better place, and I’m optimistic that we’re going to have a new FDA that’s aligned with the excitement that we have in science and medicine.”

[Editor’s note: The BIO notebook is a joint effort by the Pink Sheet and Scrip.]