How the IRA Is Reshaping Drug Evaluation Through Medicare-Focused Real-World Evidence

In an era in which the Inflation Reduction Act (IRA) is reshaping how Medicare evaluates and pays for prescription drugs, real-world evidence has become a central pillar of decision-making. In this interview, Ashis Das, MD, PhD, from ADVI Health discusses how the Centers for Medicare & Medicaid Services (CMS) is redefining “value,” the growing influence of real-world effectiveness and adherence data, and what manufacturers and payers must do to meet rising expectations.

Key Takeaways

• CMS is shifting from trial-based assessments to Medicare-centered real-world evidence (RWE), emphasizing actual clinical benefit, durability of outcomes, adherence, and subgroup performance.
• High-quality, methodologically transparent RWE—especially comparative effectiveness and adherence data—now plays a critical role in shaping pricing negotiations under the IRA.
• Manufacturers and payers can strengthen their position by collaborating early on Medicare-relevant analytics, standardized endpoints, and evidence that reduces uncertainty for CMS.

Ashis Das, MD, PhD: My name is Ashis Das, and I serve as a senior director at ADVI Health, where I lead RWE and Medicare analytics engagements supporting biopharmaceutical innovators. My background spans clinical medicine, epidemiology, and global health research, with more than 2 decades of experience designing and executing RWE studies, Medicare claims analyses, and evidence strategies to inform market access, pricing, and regulatory decisions.

At ADVI, I work closely with life sciences clients navigating the evolving expectations of the IRA, particularly around real-world effectiveness, utilization patterns, and clinical benefit assessments derived from CMS data. My focus blends methodological rigor with practical policy insight to help manufacturers bring life-saving therapies to patients faster while meeting CMS’s increasingly data-driven standards.

How is CMS redefining “value” through real-world evidence under the IRA?

Dr Das: The IRA has accelerated CMS’s shift from traditional, trial-centric value definitions toward a broader, population-based view grounded in real-world effectiveness, clinical benefit durability, and patient heterogeneity. CMS is now emphasizing the following:

• Actual clinical benefit in Medicare populations, not idealized trial cohorts
• Evidence of sustained outcomes over time, especially for chronic therapies
• Utilization and adherence patterns that reflect real practice constraints
• Comparative effectiveness signals against therapeutic alternatives
• Equity and access considerations, including differences across subgroups

By embedding RWE into its negotiation frameworks, CMS is effectively saying that value is no longer determined by “how well a drug works in trials,” but by “how well it performs in Medicare beneficiaries facing multimorbidity, polypharmacy, and structural barriers.” This redefinition makes RWE not a supplement to the value story—but a centerpiece.

What challenges and opportunities do payers face when interpreting real-world effectiveness data?

Dr Das: Challenges for payers include the following:

• Heterogeneous data quality: Variation in coding, missingness, and provider practices can obscure true effectiveness.
• Confounding and bias: Older, sicker Medicare populations make causal inference complex without advanced methods.
• Lack of standardization: Payers often encounter RWE studies with inconsistent endpoints or time horizons.
• Generalizability: Results from commercial claims or registries do not always translate to Medicare populations.

But there are powerful opportunities:

• More representative insights: RWE captures the very patients who drive payer spending.
• Identification of underperforming therapies: Real-world outcomes often reveal gaps unseen in trials.
• Better pricing alignment: When presented rigorously, RWE can clarify value relative to existing standards of care.
• Subpopulation granularity: Payers can evaluate effectiveness among groups with unmet needs or differential response.

Ultimately, payers are eager for high-quality RWE but remain cautious; the opportunity is for manufacturers to provide methodologically transparent, Medicare-relevant evidence that reduces payer uncertainty.

How might real-world adherence patterns influence pricing negotiations under the IRA?

Dr Das: Adherence has become a critical lens for CMS because it directly affects real-world effectiveness, total cost of care, and perceived value.

• Lower adherence → lower real-world benefit: If beneficiaries discontinue early or are nonpersistent, CMS may view the drug’s clinical benefit as diminished relative to trial performance.
• High early discontinuation → higher cost per responder: Poor persistence may weaken the pricing argument for chronic therapies.
• Adherence heterogeneity → subgroup variability: CMS is increasingly attentive to differences across age, disability status, dual-eligibility, and comorbidities.

For manufacturers, explaining adherence patterns—and demonstrating that they are manageable, expected, or clinically reasonable—will be essential. Real-world adherence analyses can also support value by highlighting:

• Stable or improving patterns over time
• Adherence comparable or superior to alternatives
• The link between adherence and improved outcomes or reduced downstream costs

In negotiation context, adherence is no longer just a quality metric—it’s a determinant of value.

In what ways can comparative effectiveness data strengthen or weaken a manufacturer’s negotiating position?

Dr Das: Comparative effectiveness can strengthen a manufacturer’s position when it shows:

• Demonstrating superior real-world outcomes versus therapeutic alternatives can anchor a strong value narrative.
• Evidence of durable benefit or reduced downstream utilization (hospitalizations, complications) reinforces clinical and economic value.
• Showing effectiveness in difficult-to-treat or high-need subgroups aligns with CMS’s equity priorities and can substantively shape negotiation discussions.

It can weaken the position when:

• If comparative data show parity or inferiority, CMS may argue for price reductions to align with alternatives.
• Inconsistent or conflicting evidence across datasets can undermine credibility.
• Signals of differential benefit erosion in older or disabled beneficiaries may raise concerns about generalizability.

The key is methodological transparency: Manufacturers who anticipate CMS’s analytic framework and proactively address confounding, attrition, and population selection will maintain stronger positions.

How can payers and manufacturers collaborate to generate robust Medicare RWE that aligns with CMS priorities?

Dr Das: Collaboration is increasingly essential because both sides share the same objective: credible, Medicare-relevant evidence that guides appropriate use and fair pricing.

Key opportunities for collaboration include:

• Co-developing analytic frameworks: Agreeing on endpoints, populations, time horizons, and causal inference methods upfront reduces disputes later.
• Integrating diverse data sources: Linking claims, electronic health records (EHRs), registries, and patient-reported outcomes can provide richer clinical context.
• Conducting pre-negotiation evidence scans: Jointly identifying gaps ensures studies answer the right questions for CMS.
• Launching pragmatic or hybrid observational studies: These yield higher-quality, clinically meaningful evidence than retrospective claims alone.
• Aligning on subgroup analyses: Stratification by disability, dual-eligibility, social risk factors, and multimorbidity aligns with CMS’s equity emphasis.
• Sharing insights on adherence and utilization drivers: Understanding real-world barriers can inform both clinical pathways and pricing dialogues.

The IRA has created a new era where Medicare-specific RWE is not optional but foundational. Payers and manufacturers who collaborate early—before negotiation windows open—will be best positioned to align with CMS expectations and demonstrate real value.

What common mistakes do manufacturers make when preparing RWE for IRA-related negotiations—and how can they avoid them?

Dr Das: Several recurring pitfalls can hinder a manufacturer’s negotiation position:

• Relying too heavily on trial extrapolations without validating outcomes in real Medicare populations
• Conducting RWE analyses too late, leaving little time to iterate or align with CMS expectations
• Not grounding evidence in Medicare claims, leading to questions about relevance
• Presenting complex methodologies without transparency, reducing payer trust
• Underestimating the importance of subgroup performance among dual-eligibles, diverse social groups, and disabled beneficiaries

Avoiding these pitfalls requires early planning, Medicare-specific analytics, and cross-functional alignment between clinical, Health Economics and Outcomes Research (HEOR), and policy teams.

What elements characterize ADVI’s approach to Medicare RWE and IRA negotiation support?

Dr Das: ADVI’s approach combines policy insight, RWE analytics, and Medicare operational expertise. Key features include:

• Deep understanding of CMS’s evidence expectations, including how the agency evaluates clinical benefit, durability, adherence, and comparative effectiveness
• Use of full Medicare datasets, allowing analyses based on the beneficiary groups most relevant to CMS
• Interdisciplinary teams across HEOR, policy, pricing, and coding—allowing us to connect evidence generation with real-world reimbursement pathways
• Emphasis on anticipating future evidence needs and developing analyses that may later support negotiation or policy processes
• Clear communication frameworks for translating complex RWE into narratives that resonate with CMS and payers

Together, these elements support manufacturers in preparing for IRA-related processes and in navigating Medicare access, pricing, and policy considerations more broadly.

Conclusion

We are entering a defining moment in US health care, where evidence is no longer judged by how elegantly it is produced, but by how honestly it reflects the lived experience of Medicare patients. The IRA has raised the bar—demanding rigor, transparency, and real-world relevance from every manufacturer. This is not a constraint; it’s an opportunity. Those who embrace Medicare-centered RWE will not only negotiate more effectively, but will build therapies, access strategies, and value stories that stand the test of time.

Our responsibility—as scientists, strategists, and stewards of patient outcomes—is to bring clarity where uncertainty exists and insight where complexity overwhelms. The future belongs to teams who treat RWE not as an obligation, but as a strategic advantage. That is the path to sustainable value, meaningful access, and better health for the people who rely on Medicare every day.