COVID-19 drugs are transitioning to the commercial market

In late 2022, the Biden administration signaled that it would begin transitioning COVID-19 vaccines and treatments to a more standard purchasing process in which commercial insurers and pharmacy benefit managers (PBMs) will increasingly pay for treatments. COVID-19 vaccines transitioned to the commercial market earlier this year.

Now, COVID-19 treatments including Pfizer's Paxlovid and Merck's Lagrevio are following, with the transition period beginning today and lasting through at least December. The federal government will stop ordering Lagevrio on Nov. 10 and Paxlovid on Dec. 15. Providers will be able to send back Paxlovid packs to receive government credit for the drug in Medicare and Medicaid beginning in December.

According to a federal health official, the long transition period will allow payers and providers to "work out all those kinks" in the purchasing process as government supplies of the drugs run out. After COVID-19 vaccines first entered the commercial market, there was frustration and confusion about coverage and how patients could pay for the vaccines, which were updated with new formulas this fall.

"There's probably a lesson from the vaccines. It's also an option we didn't have for vaccines because that was a product switchover [to new COVID-19 vaccines this fall]," the official said. "There was no ability to have any overlap because it was simply two different products."

How will the transition affect patients?

Earlier this month, Pfizer announced that it planned to price a five-day course of Paxlovid at $1,390, or more than double the $529 the U.S. government initially paid for the drug. However, health plans will likely pay less for the drug as Pfizer and PBMs negotiate discounts or rebates in their contracts.

There are also plans in place to either cover the drug fully or help people receive discounts for the drug.

For patients with private insurance, Pfizer has launched a copay savings program for Paxlovid that will run through 2028. Merck has also set up a similar copay savings program for its drug Lagevrio.

After difficulties with transitioning COVID-19 vaccines to the commercial markets, federal health officials say they are closely watching the transition of COVID-19 treatments to ensure patients do not lose access.

"It is of paramount importance that these medications remain widely accessible to high-risk patients after commercial distribution begins in order to minimize hospitalizations and deaths from COVID-19," said HHS Secretary Xavier Becerra. (Owermohle, STAT, 10/27; Rockoff/Hopkins, Wall Street Journal, 10/18; Reed, Axios, 10/30)

Develop a strong COVID-19 vaccine communication strategy that shares information, addresses patient concerns, and encourages uptake.