Medicaid program pays for unapproved drugs

Medicaid paid nearly $198 million from 2004to 2007 for more than 100 unapproved prescription drugs forbeneficiaries, according to an Associated Press analysis of federal data…The drugs in question, most of which are used to treat commonconditions such as colds and pain, have been on the market before theearly 1960s when FDAenhanced restrictions on pharmaceuticals. The drugs have not beenevaluated by FDA for safety or effectiveness and could putbeneficiaries at risk of adverse events or, in some cases, death.

For the report, APchecked medications covered by Medicaid from 2004 to 2007 against FDAdatabases and used agency guidelines to determine if the medicationshad been approved. Data for 2008 were not available. According to AP,unapproved drugs comprise about 2% of those sold in the U.S., or about72 million prescriptions each year. In most cases, doctors, pharmacistsand patients are not aware that these drugs are not approved. “Over theyears, they have become fully entrenched in the system,” PattiManolakis, a North Carolina pharmacist, said.

FDA hasimplemented a program to “weed out drugs it had never reviewedscientifically,” but many have “continued to escape scrutiny,” and”conflicting federal laws” allow Medicaid to continue paying for them… FDA estimates there could bethousands of drugs sold in the U.S. that never have been approved. Manymanufacturers claim their drugs were “grandfathered in” under earlierlaws and exempt from FDA regulation. However, FDA compliance lawyerMichael Levy questioned the grandfather status of unapproved drugs,saying that to qualify, the drugs would have to be exactly the same informulation and other aspects as medications sold decades ago.

  Response 
Critics say that FDA’s “case-by-case approach” is ineffective and thatthe agency must create a comprehensive list of drugs that have not beenapproved to ensure that Medicaid and private insurers do not pay forthem.  Jon Glaudemans, senior vice president of Avalere Health,said, “FDA does not appear to have a systematic mechanism to reportthese drugs out, and there doesn’t seem to be a systematic process bywhich health insurance programs can validate their status,” adding,”And everyone is pointing the finger at someone else as to why we can’tget there.”

The agency says it would be difficult to createsuch a list because drugmakers do not list unapproved products with theagency. The analysis found that some of the drugs are listed, whichcould provide a “possible starting point” for such a list… Levy said, “The situation is complicated by the fact thatMedicaid and Medicare have a different regulatory regime than FDAdoes,” adding, “There are products that we may consider to be illegallymarketed that could be legally reimbursed under their law.”

Medicaidofficials say Congress needs to step in to help address the matter.Medicaid Chief Herb Kuhn said, “I think this is something we ought tolook at very hard, and we ought to fix it.” He added, “It raises awhole set of questions, not only in terms of safety, but in theefficiency of the program — to make sure we are getting the right setof services for beneficiaries.” Senate Finance Committee ranking member Chuck Grassley (R-Iowa) has asked the HHS Office of Inspector Generalto investigate the issue. Grassley said, “The problem I see isbureaucrats don’t want to make a decision. There is no reason why thisshould be such a house of mirrors when so much public money is beingspent” …

Source/more:  KFF/AP/Houston Chronicle, http://kaisernetwork.org/daily_reports/rep_index.cfm?DR_ID=55724