NCHR Comments on the CMS Inflation Reduction Act Initial Program Guidance

April 14, 2023

The National Center for Health Research (NCHR) appreciates the opportunity to submit public comments on the Centers for Medicare & Medicaid Services (CMS) Inflation Reduction Act (IRA) Initial Program Guidance. NCHR is a non-profit think tank that conducts, analyzes, and scrutinizes research on a range of health issues, with particular focus on which prevention strategies and treatments are most effective for which patients and consumers. We do not accept funding from companies that make products that are the subject of our work, so we have no conflicts of interest.

We greatly appreciate the efforts of CMS to fully implement the authorities provided by Congress in the Inflation Reduction Act (Pub. L. 117-169) to lower the costs of prescription drugs for beneficiaries through drug price negotiations. We have focused our comments below on key items within the initial program guidance including criteria to select drugs for negotiations, data reporting requirements for selected drug manufacturers, use of real-world evidence, and inclusion of research using surrogate endpoints to demonstrate effectiveness of alternative therapeutics and have highlighted specific considerations for CMS.

Use of Real-World Evidence

We agree with the inclusion of pharmaceutical alternative therapies to assist with establishing initial negotiated price. It is important to consider to what extent the selected drug and alternative therapies have been shown to be safe and effective among the Medicare population and to consider the quality of the data used to make the determinations. The guidance document states that CMS will review real-world evidence (RWE) in considering clinical benefit of a selected drug and evidence of therapeutic alternatives. RWE can be a valuable tool when used properly, however there are limitations that should be considered. The use of RWE requires access to unbiased data of a substantial number of patients that are demographically and medically similar to the U.S. Medicare population. Patient registries have been excellent sources of information in other countries, but there are numerous shortcomings for their use in the U.S. Registries have the potential to include a matched control group to evaluate a product’s effectiveness and safety, but are unlikely to make such comparisons. Research has indicated that registries often miss confounding patient and medical center variables that were not evaluated but influenced outcomes.[1] Further, access to information from registries is a major problem in the U.S., as most if not all registries are controlled by medical societies. These societies control the data collected as well as the data that they will make public to government agencies, or other researchers. Lastly, these registries typically include little, if any patient-reported outcomes, such as pain or quality of life, as well as lacking data on other adverse events which are needed to evaluate outcomes that truly matter to patients.

“Big Data” from billing records and electronic health records can also be used to determine very serious adverse events, but have several limitations.[2],[3] It is not possible to determine if patients took medication as instructed or complied with instructions. Additionally, when patients report adverse effects, especially those that are subjective and relatively common, that information is not always included in billing records or EHR, making it difficult to accurately evaluate the frequency of those events.

Use of Surrogate Endpoints

The document also states that CMS will consider “validated surrogate endpoints that predict a relevant health outcome” to determine the clinical benefit of the selected drug and therapeutic alternatives. There is not always agreement whether a surrogate endpoint is a consistently accurate predictor of clinical outcomes and CMS should take this into consideration when reviewing data based on surrogate endpoints, and rely on the preponderance of solid scientific evidence. Surrogate endpoints are used by manufacturers to obtain approval by the Food and Drug Administration (FDA). They are especially common for obtaining accelerated approval, almost always with the requirement that efficacy will be validated by confirmatory trials completed at a later date. For example, the drugs aducanumab and lecanumab were granted accelerated approval based on a reduction of amyloid plaque in the brain of patients with Alzheimer’s disease. However, numerous studies have suggested this endpoint does not reliably predict changes in cognition.[4],[5] Additionally, confirmatory trials for drugs granted accelerated approval are often significantly delayed and fail to demonstrate meaningful, patient-centered outcomes, while the drug remains on the market.[6],[7] We recommend CMS only use surrogate endpoint data to determine clinical benefit if there is data using patient-centered outcomes and very strong scientific evidence.

Drug Selection Criteria

We strongly agree with the process described in the guidance document detailing how eligible drugs will be determined. Specifically, we agree with the inclusion of any dose, delivery method, indication for different patient populations, or authorized generic drug as one single source drug. Manufacturers have often used changes in dosing, delivery method, or indication to extend the life of patents on a drug, often blocking access to lower cost generic competition for years. We also agree that CMS should select the drug exclusivity timeframe based on the initial indication of the product. This will help prevent manipulating the negotiation process through harmful practices of patent abuse in the future.

Data Reporting for Selection

We appreciate the extent to which CMS will consider different data items received by drug manufacturers to determine the maximum fair price (MFP). In addition to providing information publicly, it should be made clear how these various data items are being used to justify decision making. For example, how will data submitted by the manufacturer that shows they have yet to recoup the costs of Research and Development be used by CMS? The use of the data and information required to be reported by drug manufacturers must be clearly explained to the public to promote true transparency in the process.


[1] Nørgaard, M., Ehrenstein, V., & Vandenbroucke, J. P. (2017). Confounding in observational studies based on large health care databases: problems and potential solutions – a primer for the clinician. Clinical epidemiology, 9, 185–193.

[2] Mourik, M., Duijn, P., Moons, K., et al. (2015). Accuracy of administrative data for surveillance of healthcare-associated infections: A systematic review. BMJ.

[3] Lawson, E., Louie, R., Zingmond, D., et al. (2012). A Comparison of Clinical Registry Versus Administrative Claims Data for Reporting of 30-Day Surgical Complications. Annals of Surgery. 256 (6): 973-981.

[4] Ackley, S., Zimmerman, S., Brenowitz, W., et al. (2021). Effect of reductions in amyloid levels on cognitive change in randomized trials: instrumental variable meta-analysis. BMJ. 372 doi:

[5] Zuckerman, D., Jury, N., & Silcox, C. (2015). 21st Century Cures Act and similar policy efforts: at

what cost? BMJ. 351:h6122 doi: 10.1136/bmj.h6122

[6] Eglovitch, J. (2023). Study: Half of confirmatory studies for accelerated approvals are late. Regulatory Focus

[7] U.S. Department of Health and Human Services, Office of Inspector General. (2022). Delays in Confirmatory Trials for Drug Applications Granted FDA’s Accelerated Approval Raise Concerns.