Cigna first insurer to reach value-based agreements for new class of cholesterol drugs

As part of the broader effort to tie the cost of drugs to their value, Cigna has inked a deal with the makers of two cholesterol-lowering drugmakers to receive extra price discounts from them if the new medications aren't as effective as desired, according to The Wall Street Journal.

Cigna announced Wednesday that it is the first insurance company to finalize value-based contracts for an entire new class of cholesterol medications. Two drugs introduced last year to reduce levels of LDL cholesterol — Praluent, which is co-marketed by Sanofi SA and Regeneron Pharmaceuticals, and Amgen's Repatha — are the only two such PCSK9 inhibitors currently on the market in the U.S., according to the report. Both drugs are shown to be more effective at reducing LDL than statins.

Both cholesterol drugs cost a minimum of $14,000 per year, and Cigna negotiated an undisclosed discount off the list prices, according to the report. 

Under the terms of the contract, if Cigna-insured patients who take either of the two drugs aren't able to lower LDL cholesterol as effectively as was shown in clinical trials, the drugmakers will apply further discounts to the costs of the goals for all of the insurer's patients. On the flipside, if the cholesterol drugs meet or surpass expectations, the original negotiated price stays intact, according to the report.

Cigna has access to patients' cholesterol levels and will monitor them over "a period of time, months and quarters" to determine whether they are meeting targets, Chris Bradbury, senior vice president for Cigna's pharmacy benefits business, told The Wall Street Journal. A Cigna spokeswoman said the insurer will also monitor patients' medication adherence, side effects and drug interactions, as well as review lab results and work with customers' physicians as necessary, according to the report.

Insurance companies and pharmacy benefits managers have reached at least a dozen similar deals with drug manufacturers since 2014, including Cigna, Harvard Pilgrim Health Care and Express Scripts for high-cost drugs, particularly for cancer and hepatitis C, according to the report. While the volume of such deals has increased, they will likely only make a small impact in overall drug spending in the near-term. This is largely because accurately determining value of a drug involves carefully tracking patients' health over time, and this can be a barrier.

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