Gilead has applied to CMS for a Medicare add-on payment for the FDA-approved COVID-19 treatment remdesivir, according to federal filings.
If the normal timeline for obtaining a New Technology Add-On Payment applies, the earliest a payment would be effective is October 2021. There's a chance that the prevalence of the coronavirus could be mitigated by that time if vaccines are effective and distributed quickly, but the payment would still apply if CMS approves it.
"NTAP approval does not require a certain case volume — if remdesivir is approved for NTAP payments, it doesn't matter if there are 10 or 1 million qualifying cases in a year," said Dr. Christopher Manz, an oncologist at the Dana-Farber Cancer Institute and an instructor in medical oncology at Harvard Medical School.
By that time, it's also possible that superior therapeutics will be available that would decrease remdesivir's usage and financial impact.
"I think by the end of next year hopefully COVID will be a very rare disease in the US — there will still be some presumably who acquire it, but hopefully many fewer who end up in the hospital, especially with the antibodies available or perhaps other therapies yet to be proven," said Dr. Walid Gellad, an associate professor of health policy at the University of Pittsburgh.
A NTAP would only apply if a hospital lost money on a COVID-19 admission.
To get approval for a NTAP, Gilead would have to prove that remdesivir produces a substantial clinical benefit in patients. Avalere Health Senior Consultant Abby Moorman said FDA approval alone isn't enough to show substantial clinical benefit.
A NTAP for remdesivir would only likely be relevant after the COVID-19 public health emergency is over, as CMS in October announced interim add-on payments for COVID-19 treatments including remdesivir through the HHS-declared public health emergency. The declaration next expires in January, though stakeholders think it's likely the emergency will be renewed.
The interim payment, called a New COVID-19 Treatments Add-on Payment, is the lesser of 65% of the operating outlier threshold for the claim, or 65% of the cost of a COVID-19 stay beyond the operating Medicare payment, including the 20% add-on payment for COVID-19 hospitalizations created in the Coronavirus Aid, Relief, and Economic Security Act.
The CARES Act 20% add-on payment also expires with the public health emergency declaration.
CMS has not clarified how the payments would interact if the COVID-19 public health emergency lasts until next October, Moorman said.
Gilead will argue that remdesivir deserves a NTAP during a virtual town hall starting Dec. 15.