IRA Negotiation Impact Analysis — Zenvara 2032+ Eligibility
Prepared by Sara Lindqvist, HEOR Director. Distribution: VP Commercial, CCO, CFO, Board package. Quarterly review.
Executive summary
Zenvara (zenvalimab) is a small-molecule biologic eligible for inclusion in the IRA Medicare Drug Price Negotiation Program on the standard 7-year post-approval timeline. FDA approval was March 21, 2025; the selection eligibility window opens January 1, 2032. Under the current statutory timeline, the Maximum Fair Price (MFP) would become effective for Zenvara on January 1, 2034.
Modeled MFP outcomes range from 38% to 52% off WAC, with a base case at 47% off WAC. Net present value impact across the 5-year period 2032-2036 ranges from -$1.2B (worst case) to -$0.4B (best case) versus a no-IRA counterfactual. Assumes WAC of $14,000 per 480mg vial and Q6W dosing.
Three scenario branches drive the range: (a) MFP severity, (b) volume erosion in non-Medicare segments through reference pricing, (c) eligibility for the small-molecule extension under HHS rule-making.
IRA mechanics
The IRA Medicare Drug Price Negotiation Program selects up to 15 Part D drugs per year for negotiation. Zenvara is selectable in the year-7-post-approval window (2032) given Part D inclusion at 22 of the top 25 plans by Medicare beneficiaries.
Selection criteria: total Part D gross spend (last 12-month basis), no biosimilar or generic competition. Zenvara is expected to rank in the top 25 of selectable drugs by 2032 based on current trajectory and indication-expansion modeling. Selection is therefore highly likely.
Negotiation cycle: 30 days from selection notice for manufacturer to indicate participation. Counteroffer cycle through Spring of selection year. MFP announced August 1 for the next-year January 1 effective date.
The MFP applies to all Part D dispenses for Medicare beneficiaries. It does not apply to commercial, Medicaid, or 340B; however, the published MFP creates a reference price that downstream payers use in their negotiations.
Scenario A — Maximum MFP severity
Assumption: HHS uses the lower bound of the negotiation framework, MFP set at approximately 52% off WAC ($6,720/vial). Volume erosion in commercial segments: minimal in year 1 of MFP (2034), 8-12% by year 5 (2038) as reference pricing flows through to commercial contracting.
5-year NPV impact (2032-2036): -$1.2B vs. no-IRA counterfactual. Assumes flat Zenvara WAC, current rebate structure, no indication expansion.
Mitigations modeled: indication expansion in 2L (IMpact-2 readout 2026), pediatric indication (PIP for AML — speculative), subcutaneous reformulation (Phase 1 PK bridging 2028, market entry 2030).
Scenario B — Base case
Assumption: MFP set at 47% off WAC ($7,420/vial). Volume erosion in commercial: 4-6% by year 5.
5-year NPV impact (2032-2036): -$780M vs. counterfactual.
This is the planning case used in 2026 commercial decisions.
Scenario C — Small-molecule extension granted
Assumption: HHS grants the small-molecule MFP extension that the industry is seeking (currently a regulatory proposal, not statutory). Under the proposed extension, small-molecule biologics get an additional 4 years of post-approval protection (11 years vs. 7).
Effect: MFP effective date moves from 2034 to 2038. NPV impact for the 2032-2036 window: -$420M (versus the base case -$780M).
Probability of extension being granted: 25-35% per current industry guidance.
Sensitivity
The dominant sensitivity is volume erosion in non-Medicare segments. A 200 bps difference in commercial volume erosion at year 5 (8% vs 6%) changes the 5-year NPV by approximately $180M.
The second-largest sensitivity is the WAC trajectory. The model assumes flat WAC through 2034; a 4% annual WAC increase (consistent with current oncology trend) would increase the gross-revenue base by $580M over the period, offsetting roughly two-thirds of the MFP impact.
Third sensitivity: indication expansion. Each net-new approved indication adds approximately $90M in annual Part D net revenue at maturity. Adjuvant breast cancer (currently in Phase 3 design) would, if successful, materially shift the post-2034 trajectory.
Strategic implications
Pre-MFP (2026-2031): aggressive indication expansion, geographic expansion, and patient access program scale. Goal is to maximize the addressable lifetime patient population before MFP effective.
MFP year (2034): coordinated public-affairs response, P&T-level repositioning, defensive net-price management with commercial payers to slow reference-pricing diffusion.
Post-MFP (2034-2040): lifecycle management dominant. Subcutaneous reformulation (if PK-bridging succeeds) creates a parallel product not subject to the existing MFP. Combination products with adjacent assets may extend the franchise.
Comparable cases
The first 10 IRA-negotiated drugs (selected 2023, effective 2026) had MFP set at 38-79% off WAC across the cohort. Oncology drugs in the cohort (Imbruvica) faced approximately 38% off WAC. Cardiovascular and metabolic agents faced higher reductions.
Zenvara's position is similar to the oncology comparators in the first cohort: clinically essential, no biosimilar competition expected, established premium pricing. The 47% base-case is at the higher end of the comparable cohort because Zenvara is single-agent (no companion-product complexity).
Decision points for executive review
Q3 2026: confirm 2027 commercial plan assumptions on volume and net price under each scenario.
Q1 2027: indication-expansion go/no-go on adjuvant breast (Phase 3 design).
Q1 2028: subcutaneous reformulation phase-2 go/no-go.
Q3 2029: pre-MFP scenario-planning workshop with executive leadership.
Q1 2031: pre-selection messaging and stakeholder engagement strategy.
Cross-references
2026 Commercial Plan (1P1…), Lifecycle Management Roadmap (1Q4…), Evidence Dossier Index (1I8…).