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Kidney Disease: A Price-Sensitive Market But A Bundle Of Opportunity

Medicare’s bundling policy for drugs and services in dialysis has turned on the pricing pressure in kidney disease. The cost containment policies have negatively impacted sales of some drugs and put a spotlight on growing costs in chronic kidney disease and end-stage renal disease. Nonetheless, there is plenty of opportunity for new drugs that can address the area’s unmet medical need, especially if they can help to reduce broader health care spending. That will require demonstrating value to payors and providers, however, particularly for drugs that treat secondary conditions associated with kidney disease.

Medicare’s “bundling” policy, intended to reduce drug spending in the dialysis setting, has turned pricing pressure into a choke hold in kidney disease. The cost containment policies for intravenous drugs went into effect Jan. 1, 2011, making the year a tense one for some drugmakers working in the therapeutic area. And the measures are set to extend to oral drugs in 2014, which means pricing pressure in dialysis isn’t going to diminish anytime soon.

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