Feds come down in support of subsidizing copays in some clinical trials

The feds recently said that device companies can subsidize copays in clinical trials, a move that was praised by food and drug attorneys at Hyman, Phelps & McNamara.

An advisory opinion issued by the Office of Inspector General involved an incident in which subsidizing a copay was necessary in order to keep the trial's subjects blinded so that they would not know whether they were receiving the treatment or control procedure, known as a sham.

In an unspecified, randomized, double-blind, placebo-controlled trial of percutaneous image-guided lumbar decompression (PILD) for patients with a spinal condition, the subjects in the treatment arm were set to owe copayments, while the control arm would not, because they were receiving a fake procedure designed ward off the placebo effect. The difference risked unblinding the patients, meaning they would be able to determine whether they were in the treatment or control arm.

The manufacturer proposed paying the patients' copays directly to the healthcare provider in order to solve the problem, though the move could have been looked down upon by the feds, specifically the OIG, which is the government's corruption watchdog. It has made a habit of cracking down on questionable payments, such as those involving physician-owned distributorship.

According to the FDA Law Blog, "The OIG found that this arrangement presented minimal risk of fraud and abuse" because it was "designed in consultation with CMS," "was necessary to enable a properly designed study to be conducted," and was "a reasonable means of achieving the Study's goals because it both encourages necessary patient enrollment in the Study and allows for the true impact of the PILD using the System on patient health outcomes to be isolated and assessed."

Thus, the advisory opinion was supportive of necessary adaptations to support optimal trial design, even if the solutions involve financial transactions that would otherwise raise a red flag. The FDA Law Blog says device (and pharma) companies should be pleased with the opinion, for conducting clinical trials can be tricky and requires flexibility, especially in the device arena.

For instance, med tech companies cannot easily incur the costs related to experimental therapies because they often involve expensive surgeries or procedures. CMS reimbursement to the providers of industry's experimental devices is not guaranteed, though advocates like AdvaMed have said they would like to change that.

And CMS reimbursement raises challenges of its own. Although it helps industry cover trial expenses, the copays can still be costly for patients, resulting in reduced participation by low-income patients. Even worse, as in the trial at issue, the payment can enable patients to determine whether they are receiving a real or sham procedure, invalidating the study design.

"Although it is somewhat perilous to extrapolate OIG conclusions in one Advisory Opinions to different situations, we would hope that the OIG would take a similar view of copay subsidies in other types of well-designed non-inferiority studies where they are intended to ensure the integrity of the clinical trial, and not intended as inducements to purchase or prescribe products," the FDA Law Blog said.

- read the FDA Law Blog
- here's the advisory opinion (PDF)