CMS to states: Medicaid must cover drugs approved under AA pathway

CMS has issued a <a href="https://www.medicaid.gov/medicaid-chip-program-information/by-topics/pr…; target="_blank">release</a> clarifying that state Medicaid programs are required to cover drugs approved under FDA's accelerated approval (AA) pathway.

CMS has issued a <a href="https://www.medicaid.gov/medicaid-chip-program-information/by-topics/pr…; target="_blank">release</a> clarifying that state Medicaid programs are required to cover drugs approved under FDA's accelerated approval (AA) pathway. It says pharmaceuticals that are granted accelerated approval are approved by FDA and can satisfy the definition of covered outpatient drug, and if used for a medically-accepted indication, then they must be covered by state Medicaid programs "if the manufacturer has an applicable signed Medicaid national drug rebate agreement for participation in the MDRP [Medicaid Drug Rebate Program]." The move could cause further financial strain on states, warned Rachel Sachs, a professor of law at Washington University in St. Louis. In its release, CMS stated that FDA can grant accelerated approval to a drug for a serious or life-threatening disease or condition either if a surrogate endpoint is likely to predict a clinical benefit, or if a clinical endpoint can be measured earlier than irreversible morbidity or mortality and is likely to predict an effect on clinical benefit, taking into account factors including severity of the condition and the availability of alternative treatments.