Last December the Trump administration unveiled two proposed rules designed to curb rising drug costs under Medicare Parts B and D, extending the Most Favored Nation (MFN) pricing framework to drugs not yet covered by the existing Medicare Negotiation Program. These initiatives, known as the Global Benchmark for Efficient Drug Pricing (GLOBE) Model for Part B and the Guarding U.S. Medicare Against Rising Drug Costs (GUARD) Model for Part D, aim to align U.S. prices more closely with those in economically comparable countries. For allergists and their practices, these changes could influence the availability and affordability of key medications, such as inhaled corticosteroids.
Understanding the GLOBE Model for Medicare Part B
The GLOBE Model targets certain single-source drugs and biological products under Medicare Part B – typically physician-administered therapies – with a focus on those already subject to the Part B Inflation Rebate Program. Manufacturers would face rebates if their U.S. prices exceeded benchmarks derived from international data in select Organization for Economic Cooperation Development (OECD) countries meeting specific gross domestic product (GDP) criteria (at least 60% of U.S. GDP per capita and $400 billion annual GDP). Rebates would be calculated using the greater of two methods: the lowest country-level price or a volume-weighted average across reference nations.
This mandatory model would roll out in a randomized 25% of U.S. zip code tabulation areas, affecting Medicare Fee-for-Service beneficiaries in those regions. CMS projects $11.9 billion in net savings over seven years, without directly altering provider payments. However, manufacturers might adjust strategies, potentially impacting supply chains or patient assistance programs. While Part B drugs are less common in allergy practices (e.g., biologics), ripple effects could extend to broader pharmaceutical innovation.
The GUARD Model for Medicare Part D
Complementing GLOBE, the GUARD Model applies similar international benchmarking to Part D drugs – self-administered medications like inhalers – modifying inflation rebates for qualifying products. The model applies to high-spend drugs (over $100 million in annual Medicare FFS spending) that do not already have a Maximum Fair Price (MFP) from the Inflation Reduction Act’s (IRA’s) negotiation process. This could directly affect allergy treatments, as many inhaled therapies fall under Part D.
CMS anticipates significant savings while preserving access, but stakeholders worry about unintended consequences, such as reduced manufacturer incentives leading to product withdrawals or shortages.
Potential impacts on allergy patients and practices
Allergists know that asthma and allergy management relies on a diverse array of inhalers. Each inhaler is tailored to specific patient needs – from rescue to maintenance therapies. Even with multiple options available, the market’s niches mean that losing access to just a subset could disrupt care. A stark example is the 2024 discontinuation of branded Flovent (fluticasone propionate HFA), attributed in part to pricing pressures and the shift to generics. This led to a 17.5% increase in asthma-related visits in the first quarter post-discontinuation and a 24.1% rise in the second quarter, with higher hospitalization rates among affected patients. Children were particularly vulnerable, with many discontinuing inhaled steroid therapy altogether, heightening risks of exacerbations.
The College emphasizes that while fair pricing is essential, policies like GLOBE and GUARD must not compromise drug availability or stifle research into new therapies. Excessive price controls could deter innovation, limiting future options for complex conditions like severe asthma. As one expert noted, these models represent a bold step toward MFN alignment but require careful calibration to avoid supply disruptions.
The College submitted comments highlighting these concerns, stressing the need for balanced policies that protect patient access. Stay tuned for updates from the College on our official submission.
The Advocacy Council – ADVOCATING FOR ALLERGISTS AND THEIR PATIENTS
