Public Citizen says Medicare delayed Creon price talks by seven years

A little-noticed change to how Medicare classifies AbbVie's pancreatic drug Creon delayed price negotiations on the medicine by seven years and could cost the program billions of dollars, according to a report from the advocacy group Public Citizen.

Public Citizen released the analysis Thursday, as the Centers for Medicare and Medicaid Services prepared a new round of talks with drugmakers over the prices it pays for a limited set of medicines. The report says the agency treated Creon as a biological product rather than a small-molecule drug, a distinction that carries a longer wait before a medicine can be picked for negotiation, and that the choice has not drawn public attention.

The 2022 Inflation Reduction Act set two clocks. Small-molecule drugs become eligible for negotiation seven years after approval, and biological medicines after eleven. Reclassifying an older drug as a biologic adds four years to that wait, though Public Citizen puts the total delay for Creon at seven years.

What Medicare changed

Creon won FDA approval in April 2009 to treat exocrine pancreatic insufficiency, a condition in which the pancreas does not make enough enzymes to digest food. The medicine is a mix of enzymes drawn from pig pancreatic tissue, and such porcine-derived products are sometimes classed as biologics.

Public Citizen said CMS never explained the classification when it made the change, and that the shift had not been examined publicly before the group's report. The Trump administration has since proposed a rule that would make the approach permanent, and neither the report nor the coverage of it recorded a response from the agency to the findings.

By keeping Creon out of the current round, Medicare instead selected a different medicine that accounted for roughly half a billion dollars less in program spending over the same period, the report says.

Creon cost Medicare $1.49 billion in gross spending in 2024.

More than 185,000 Medicare beneficiaries used the drug that year, the report says. Creon holds about 82 percent of pancreatic enzyme replacement prescriptions among surveyed gastroenterologists and preferred coverage on 83 percent of Medicare Part D plans, according to industry prescribing figures, a market position that shapes how much a negotiated price could have saved the program.

Two windows, one drug

The distinction matters because the negotiation timetable is tied to a drug's classification, not its age. Creon has been on the market since 2009, well past the seven-year window that applies to small-molecule medicines. Treated as a biologic, the report says, it faces a longer clock that delays the point at which Medicare can select it.

Congress directed the FDA to reclassify a set of older protein-based products, including some enzyme drugs, as biologics. Public Citizen argues that step was meant to open the door to cheaper competing versions and reduce government costs, not to lengthen the period during which a brand-name drug can avoid negotiation. The group says the classification is being used for the opposite purpose.

The report points to a parallel strategy by AbbVie in a separate negotiation dispute, where the company argued that plasma-derived products should be ineligible under CMS guidance. In both cases, the report says, a classification question, not the drug's cost or how long it has been sold, decides whether an expensive medicine faces price talks.

What Public Citizen argues

Peter Maybarduk, who directs Public Citizen's Access to Medicines program, cast the proposed permanent rule as a giveaway to drug manufacturers. He said the administration should drop the approach rather than write it into regulation.

The Trump administration wants to make permanent a costly Medicare mistake, which creates windfalls for AbbVie and other drug corporations by excluding some expensive biologic drugs from negotiations for years.

Sarah Karlin-Smith, the program's research director, said Congress required the FDA to convert the older drugs to biologics so cheaper alternatives could be produced and government costs reduced, not so that companies could put off negotiation. She called the policy harmful and urged the administration not to continue giving old drugs what she described as an unfair delay.

How much the delay would ultimately cost is not settled. The report frames the figure as billions of dollars over time but does not put a single number on the loss, and the savings from any negotiated price would depend on the discount Medicare secured and how long the delay held.

CMS has not publicly said why it treated Creon as a biologic.

The negotiation program grew out of the Inflation Reduction Act, which became law in 2022 as lawmakers moved to address rising prescription drug prices. It lets Medicare set prices for a limited number of high-cost medicines each year, a power the program did not previously hold, and the current round is the reason the Creon decision drew scrutiny.

The drug at issue

Creon is prescribed for people whose pancreas cannot produce enough digestive enzymes, a problem tied to cystic fibrosis, chronic pancreatitis, surgical removal of the pancreas and other conditions. The capsules supply the missing enzymes so patients can absorb nutrients from food, and for many the medicine is taken with every meal.

Where the proposal stands

The Trump administration's proposed rule would lock in the classification approach that kept Creon out of the current negotiation round. Public Citizen released its report as CMS prepared the next set of price talks, and the group is pressing the agency to abandon the policy before it becomes permanent.

Medicare would have been owed larger mandatory discounts on Creon than on the medicine chosen in its place, the report says, deepening the potential price cut it passed up.

AbbVie's position on the report was not included in Public Citizen's analysis or in the coverage of it. The company has not addressed the classification of Creon in the material available, and it is not clear whether it sought the biologic treatment or simply benefited from it. The report attributes the decision to Medicare.

What the report counts

The central figures come from 2024 Medicare data cited in the report. Creon accounted for $1.49 billion in gross spending that year, while the medicine chosen for negotiation instead accounted for roughly half a billion dollars less over the same span, a smaller target for any price cut.

Public Citizen did not publish a year-by-year projection of the loss, and the report does not model spending under a negotiated price. Its estimate rests on the gap between what Medicare pays now and what a discount might have yielded had Creon been selected in the current round.

The scale of any savings turns on Creon's dominance. With preferred placement across most Medicare Part D plans and the large majority of enzyme-replacement prescriptions, the drug generates steady program spending that a negotiated price would apply against, which is why the report treats it as a costly omission from the current round.

The report did not say when the administration's proposed rule would be finalized, and the timing of the next negotiation round was not detailed in the material available.

The analysis was reported by STAT News, whose Pharmalot column covers drug pricing and access. Public Citizen described the policy as one that would cost the government more and compromise patient access, though the report stops short of quantifying the effect on individual beneficiaries.

For now, the dispute rests on how a decades-old enzyme drug is labeled and what that label means for the price Medicare pays. Whether the agency defends the change, revises it or leaves it in place will determine if Creon enters negotiations years earlier than the current path allows.