Ardelyx Won’t Include Xphozah in CMS Bundle Payment Program


Company officials have said the bundled payment program could negatively impact sales of Xphozah, which was approved last year to reduce serum phosphorus in patients with kidney disease on dialysis.

Ardelyx will not seek to have for Xphozah (tenapanor), its therapy to reduce serum phosphorus in adults with chronic kidney disease (CKD) on dialysis, included in CMS’ bundled payment system for oral therapies in the End-Stage Renal Disease (ESRD) Prospective Payment System.

In a news release, company officials said their analysis of the CMS policy to include all oral-only medicines in the Transitional Drug Add-on Payment Adjustment (TDAPA) program could cause significant restrictions on the use of Xphozah for all patients. 

Mike Raab

Mike Raab

During an investor call, Mike Raab, president and CEO of Ardelyx, said under the new rule, Xpozah is being considered as a dialysis service and not part of the specific Transitional Drug Add-on Payment Adjustment program developed for phosphate binders.

“About 550,000 patients on dialysis in the United States, and 80% require prescription therapies for elevated phosphorus,” he said. “Despite use of phosphate binders, many patients are unable to achieves levels within target range. Patients need other options to manage phosphate levels.”

Rabb said, as a result, putting Xphozah in the bundle would likely its limit use for all patients. “We’ve seen these dynamics in the past with other novel therapies,” he said. “Drugs that were providing meaningful clinical benefit being so restricted, manufacturers ultimately chose to discontinue marketing efforts.”

Rabb did not specify what restrictions would be put on n Xphozah or how those restrictions would come about. But in a 10K filling to the Securities and Exchange Commission for year-end 2023, company executives said reimbursement under the TDAPA program will likely impact revenue from sales of Xphozah.

In the filing, the company said it expects CMS to increase bundled payments to dialysis facilities to administer oral only drugs, but “there are no assurances that any increase in the single bundled payment base rate will be sufficient to adequately reimburse the dialysis facilities for Xphozah at a price that is profitable for us.”

The FDA approved Xphozah in October 2023 as add-on therapy in patients who have an inadequate response to phosphate binders or who are intolerant of phosphate binder therapy. The product generated $2.5 million in net revenue through Dec. 31, 2023. In the first quarter of 2024, Xphozah generated $15.2 million.

The cost of Xphozah is about $3,126 for a supply of 60 tablets, according to Patients with commercial insurance may be eligible to pay $0 per 30-day prescription.

CMS’ new rule, released on June 27, 2024, outlines the inclusion of oral-only drugs and biological products into the ESRD Prospective Payment System. When it was first implemented, the ESRD Prospective Payment System excluded oral-only drugs. Since then, laws have updated the program to allow for inclusion of oral-only drugs in the ESRD Prospective Payment System beginning Jan. 1, 2025.

CMS said in its proposed rule that the inclusion of oral-only drugs will expand access to the 21% of the end-stage renal population that does not have Part D coverage.

Rabb said the best opportunity for all patients to have access to Xphozah is passage of the bipartisan legislation introduced in both the House and the Senate extending the exclusion of oral-only medications from entering the bundle.

In the House, the Kidney PATIENT Act passed 41-1 in the Ways and Means Committee in March 2024. Congresswomen Carol Miller (R.-W.V.) and Terri Sewell (D.-Ala.) introduced the legislation to provide access to oral medicines for chronic kidney disease patients through Medicare Part D through 2027. Another version of this bill would extend Medicare Part D coverage through 2033.

In the Senate, a bill sponsored by Marsha Blackburn (R.-Tenn.) was introduced in June 2024 and referred to the Committee on Finance. This will bill would delay inclusion of oral-only medications into the prospective payment system, but no other information is available.

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