‘A huge shock to the system’: Doctors warn about asthma inhaler switch coming in January

Starting January 1a drug that thousands of patients depend on to help them breathe will disappear from pharmacy shelvesand doctors are concerned patients may have delays switching to alternatives and getting them covered by insurance.

Manufacturer GSK has said it’s discontinuing the branded asthma inhaler Floventand instead is making an “authorized generic” versionwhich is identical but without the same branding.

Physicians who treat patients with asthma say the authorized generic will work just as well as the branded drugbut it doesn’t appear to be covered as widely by insurers. That may mean patients will have to obtain new prescriptions and sort out coverage hurdles at the height of respiratory virus season.

“This medication has been the most commonly used inhaled medication for the past 25 or 30 years,” said Dr. Robyn Cohena pediatric pulmonologist at Boston Medical Center. “It’s the one thatoverwhelminglypediatricians reach for when they decide that their patient needs a daily preventive medication. … The fact that it’s being discontinued is going to be a huge shock to the system for patientsfor families and for doctors.”

Doctors are urging patients to take action now to ensure they’ve got their medicine heading into the new year and advocacy groups have been trying to get the word out.

But the story of why Flovent is disappearingand the lack of insurance coverage for its ostensibly identical replacementtouches on some of the most complex facets of American health care and drug pricing.

Major change to Medicaid’s drug program

A spokeswoman for GSK said the company is making the change “as part of our commitment to be ambitious for patients.”

She noted the company introduced the authorized generics of Flovent HFAan inhalation aerosoland Flovent Diskusan inhalation powderin May 2022 and October 2023and thatsubsequentlyit would discontinue manufacturing the branded versions in the United States on January 12024.

The authorized genericsshe said“will provide patients in the US with potentially lower cost alternatives of these medically important products.”

Experts who follow the industry both on Wall Street and in academiathoughpoint out GSK is making the switch at precisely the time a change in Medicaid rebates could cause the company to have to pay large penalties because of price increases on Flovent over a number of years.

The legal change coming into effect on the first of the year removes a cap on Medicaid rebates that companies are required to pay if they raise the price of medicines more than inflation.

“Flovent Diskus has been on the market since 2000 and Flovent HFA since 2004and GSK has hiked the price on both products numerous times since their launch,” Dr. William Feldmanan associate physician in the Division of Pulmonary and Critical Care Medicine at Brigham and Women’s Hospital who studies asthma drugstold CNN. “These are precisely the sort of drugs that will be affected by the new policy eliminating the Medicaid rebate cap.”

Until nowthe rebates were capped at the total price of a drugso manufacturers would never pay more than a drug costs back to Medicaid.

But under a provision in the 2021 American Rescue Plan Actthat limit was removedand starting January 12024drugs that have been subject to large price increases over time could end up incurring rebates to Medicaid that are greater than their price — meaning pharmaceutical companies would sell those drugs to Medicaid at a loss.

“Obviously pharma doesn’t want to be selling at a loss on anything in its portfolio,” said Andrew Bauman analyst who covers the stock of GSK and other pharmaceutical companies for the financial firm Citi. “So it seeks to evade impact byone: discontinuation; two: authorized generic.”

An authorized genericBaum told CNNis viewed as a separate product“but still enables pharma to collect some of the economics.”

Orput another wayit’s the same product without the branding and also without the history of price increases that would leave the medicine vulnerable to such large rebates to Medicaid.

According to data from GoodRxthe price of branded Flovent has gone up about 47% since 2014.

Other drugmakers have made changes ahead of the January 1 rebate cap removal as well; makers of insulin this year announced major price cuts — of 70% or more — on their productsa move analysts estimate will save them hundreds of millions of dollars a year.

The authorized generic strategy GSK is employing “is a waybroadly speakingto maximize the profitability of the product in question,” said David Amsellema financial analyst who covers the industry at investment firm Piper Sandler.

He noted there are currently no other generic versions of Flovent approved by the FDA.

GSK did price the authorized generic lower than branded Flovent; one package of Flovent HFA in the 110 microgram dosefor examplecosts $273.83about 50% more than the $177.99 wholesale acquisition cost of its authorized generic counterpartaccording to prices the company shared with CNN. The wholesale acquisition cost is the price before insurance and rebates.

But CVS Caremarka major pharmacy benefit manager that determines which medicines are covered by insurance for its membersis giving preferential placement to another branded inhalerPulmicorton its formularyinstead of the authorized generic versions of Flovent.

“In this casethe authorized generics were more expensive than the brand name medications,” a CVS spokesman told CNN. He noted that’s based on net pricesrather than the wholesale acquisition costmeaning Pulmicort could be less expensive because of rebates its manufacturerAstraZenecapays to obtain better insurance coverage.

‘The worst possible time of year’

The fact that insurance plans aren’t broadly covering the authorized generic of Floventsaid BMC’s Cohen“means that patients are going to need to get a brand new prescription for a completely different medication in the middle of the worst possible time of yearwhich is the winter respiratory virus season.”

For patients with persistent asthmaCohen saidFlovent has been the most commonly used daily preventive anti-inflammatory medication for decades. It shrinks swelling in the airways and reduces the body’s exaggerated response to triggers that make it hard to breathe.

During cold and flu seasonshe saidit becomes even more crucial to have that daily medicine.

“FluCovidRSV — all these circulating viruses that are going around right now — are one of the biggestif not the biggesttriggers for asthma attacks in kids,” Cohen said. “This is what leads to kids being in the emergency room.”

Cohen said she’s concerned that patientsas well as physicians and pharmacistsdon’t know this change with Flovent is comingand they need to act now to work out alternatives and determine insurance coverage.

For some groupsthe alternatives are more limited. For patients with a more rare inflammatory conditioncalled eosinophilic esophagitisFlovent HFA is one of the most commonly prescribed topical steroidsand other medicines don’t have as much data supporting their use in the conditionsaid Dr. Erin Syversonan attending physician in the Division of GastroenterologyHepatology and Nutrition at Boston Children’s Hospital.

As EoE affects the esophaguspatients swallow the medicine instead of breathing it inand it can tame the inflammation that can cause pain with swallowing or food getting stuckrequiring procedures to remove it. In kidsSyverson saidEoE can lead to recurrent vomitingheartburnbelly achesand trouble making progress starting solid foodsand Flovent can help keep the condition under control.

“With the discontinuation coming upI worry it’s going to just be one more hurdle for this patient population that already has very limited medications available to them,” Syverson told CNN. “I don’t know what January is going to be likebut I’m worried.”

CNN’s Tami Luhby contributed to this report.

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