Study Questions Whether the High Price of Ocrevus is Warranted

Medicare and Medicaid could have saved about $2.5 billion if the multiple sclerosis therapy Ocrevus (ocrelizumab) was priced similar to Rituxan (rituximab) and its biosimilars, according to a research letter recently published in JAMA Neurology

Ocrevus and Rituxan are monoclonal antibodies that target CD20-expressing B cells, which are immune cells that contribute to the myeline damage in multiple sclerosis. Both were developed by Genentech and Biogen. Ocrevus was approved specifically to treat multiple sclerosis. Rituxan and its biosimilars are FDA approved to treat non-Hodgkin’s lymphoma, chronic lymphocytic leukemia. But Rituxan and its biosimilars — Riabni, Ruxience, and Truxima — are used off-label to treat multiple sclerosis because of their ability to destroy B cells.

Benjamin M. Rome, M.D.,

Benjamin M. Rome, M.D., a faculty member in the Division of Pharmacoepidemiology and Pharmacoeconomics at Brigham and Women’s Hospital, and his colleagues wanted to estimate the savings to Medicare and Medicaid if Ocrevus had been priced at the level of rituximab.

They measured quarterly prices for Ocrevus and Rituxan and three Rituxan biosimilars from 2018 to 2021. Researchers excluded two newer anti-CD20 mAbs for multiple sclerosis: Briumvi (ublituximab-xiiy), which was approved after the study period, and Kesimpt (ofatumumab), which had limited Medicare and Medicaid use through 2021.

In Medicare, researchers used average sales prices to determine Medicare Part B reimbursement; in Medicaid, they estimated net prices accounting for statutory discounts. Use and spending data were obtained from the Medicare Part B drug dashboard and Medicaid State Drug Utilization Data. They then estimated savings based on differences between net Ocrevus spending and hypothetical spending at the lowest rituximab price.

What they found was that prices for branded Ocrevus and Rituxan both decreased during from 2018 to 2021. Rituximab biosimilars were less expensive than the brand-name version in Medicare, but in Medicaid the brand-name version had lower net prices after accounting for large inflationary rebates.

The annual price of Ocrevus was more than four times higher than that for rituximab in Medicare — $69,949 compared with $11,759 for the lowest cost rituximab in the fourth quarter of 2021. In Medicaid, the price of annual price of Ocrevus was eight times higher — $47,671 compared $5,893 for the lowest cost rituximab in the fourth quarter of 2021.

The researchers also saw that from 2018 to 2021, the use of Ocrevus increased by 35% in Medicare and by 152% in Medicaid. During this time, Ocrevus spending totaled $2.5 billion in Medicare and $670 million in Medicaid.

The researchers suggest that had Ocrevus’ net price been consistent with rituximab, savings for Medicare and Medicaid would have been $1.9 billion (76%) and $590 million (86%), respectively.

Researchers in this paper point to a recent study in JAMA Neurology that showed that rituximab is not inferior to Ocrevus, and they said they the high price of Ocrevus is not justified based on comparative effectiveness.

“This study shows a clear example of why it is important for U.S. policy makers and insurers to consider the comparative effectiveness of drugs when negotiating prices,” Rome told Formulary Watch. “In cases where there is no evidence that one drug is safer or more effective than a less expensive alternative, its price should not be substantially higher.”

Rome said the study only measured the use of Ocrevus and they did not have data for the off-label use of rituximab for patients with multiple sclerosis. Researchers are working to gather and assess that data as well.

Other limitations include the possibility of overestimating Medicaid prices by not accounting for best-price discounts and not accounting for manufacturer patient assistance programs that could offset the 20% Medicare coinsurance for some patients.