Fight! Trump kicks off a war of words with the drug lob­by, propos­ing to peg Medicare prices to over­seas rates

Pres­i­dent Don­ald Trump has just fired an­oth­er shot across the bow of the glob­al bio­phar­ma in­dus­try. And the in­dus­try quick­ly fired back in what promis­es to be a live­ly bat­tle over drug prices.

Bioreg­num Opin­ion Col­umn by John Car­roll

Trump’s HHS pro­posed Thurs­day af­ter­noon to drop the cur­rent way that Medicare cov­ers drugs un­der Part B — cal­cu­lat­ing the av­er­age sales price and adding 6% to the providers who man­age the drug sup­ply — and switch to a new sys­tem that pegs US prices against the much low­er rates that have been es­tab­lished by sin­gle-pay­er sys­tems abroad.

With just days to go ahead of the mid-term elec­tion, Trump pro­posed a pi­lot pro­gram cov­er­ing half of the Part B spend, with the gov­ern­ment mov­ing to an av­er­age bas­ket price cal­cu­lat­ed from sin­gle pay­ers abroad at a 20% dis­count per year over 5 years. 

Trump is out to kill a whole flock of birds with one stone. 

First, he’s ac­cused oth­er coun­tries of free­load­ing on the US, ne­go­ti­at­ing ar­ti­fi­cial­ly low­er drug prices cov­ered by a well-doc­u­ment­ed US pre­mi­um. If man­u­fac­tur­ers are held li­able for their for­eign pric­ing, of­ten set af­ter some hard bar­gain­ing that can in­clude a re­fusal to cov­er it at all, they’d be less like­ly to of­fer a deep dis­count abroad. That could pres­sure oth­er coun­tries to pay more.

Sec­ond, he’s promis­ing to sig­nif­i­cant­ly re­duce heavy Medicare spend­ing, lop­ping bil­lions of dol­lars off of drug costs.

And third he’s mov­ing to a new sys­tem that would be­gin to force com­pa­nies to cut prices af­ter re­peat­ed­ly ac­cus­ing them of “get­ting away with mur­der” on drug prices in the US.

In­stead of a con­tro­ver­sial at­tempt to al­low cheap­er drugs to be im­port­ed in­to the US, Trump is say­ing he wants to keep the drugs and im­port the price. In this in­dus­try, that’s rad­i­cal.

Iron­i­cal­ly, the pro­pos­al that Trump came up with fol­lows a sea change in the in­dus­try’s at­ti­tudes to­ward pric­ing in the US, which con­trols the fate of its prof­itabil­i­ty. Start­ing with Pfiz­er, Trump has forced the ma­jors to at least pause their steady march to high­er prices. For many, the prospect of leav­ing their port­fo­lio prices in place would put tremen­dous pres­sure on their promis­es to in­vestors who con­trol their stock prices. And that would leave many to do some­thing they have nev­er done: ef­fi­cient­ly de­vel­op new block­busters in their R&D groups.

You can al­so ex­pect plen­ty of kick­back from the provider side of the equa­tion, who won’t like the new ven­dor sys­tem that would in­sti­tute a new sys­tem with flat fees for man­ag­ing drug sup­plies. For years physi­cians and the groups who rep­re­sent them slap back at changes that could im­pact their in­come by vow­ing to quit Medicare and leave poor pa­tients on their own.

Faced with a pro­pos­al that could start to shift the US to a new ap­proach dic­tat­ed by the sin­gle-pay­er pric­ing sys­tem — the in­dus­try’s night­mare — PhRMA and BIO came out against the pro­pos­al with all guns blaz­ing.

From PhRMA:

The ad­min­is­tra­tion is im­pos­ing for­eign price con­trols from coun­tries with so­cial­ized health care sys­tems that de­ny their cit­i­zens ac­cess and dis­cour­age in­no­va­tion. These pro­pos­als are to the detri­ment of Amer­i­can pa­tients. The Unit­ed States has a com­pet­i­tive mar­ket­place that con­trols costs and pro­vides pa­tients with ac­cess to in­no­v­a­tive med­i­cines far ear­li­er than in coun­tries with price con­trols, and it’s why we lead the world in drug dis­cov­ery and de­vel­op­ment. Amer­i­cans have ac­cess to can­cer med­i­cines on av­er­age about two years ear­li­er than in de­vel­oped coun­tries like in the Unit­ed King­dom, Ger­many and France.

The pro­posed Medicare Part B mod­el would jeop­ar­dize ac­cess to med­i­cines for se­niors and pa­tients with dis­abil­i­ties liv­ing with dev­as­tat­ing con­di­tions such as can­cer, rheuma­toid arthri­tis and oth­er au­toim­mune dis­eases. The ad­min­is­tra­tion’s pro­pos­al will al­so hin­der pa­tient ac­cess by se­vere­ly al­ter­ing the mar­ket-based Medicare Part B pro­gram by re­duc­ing physi­cian re­im­burse­ment and in­sert­ing mid­dle­men be­tween pa­tients and their physi­cians.

BIO’s Jim Green­wood had this to say:

Con­trary to the pres­i­dent’s re­peat­ed promis­es to end ‘for­eign free-load­ing,’ this pro­pos­al em­braces it and ex­ac­er­bates its harm­ful ef­fects. By adopt­ing for­eign price con­trols on the very small num­ber of in­no­v­a­tive med­i­cines that make it to mar­ket, this pro­pos­al will se­vere­ly chill in­vest­ment in new cures and ther­a­pies for Amer­i­ca’s se­niors.

To make mat­ters worse, the pro­pos­al con­tin­ues a trou­bling trend to­wards un­der­min­ing the Medicare Part B drug pro­gram. This pro­gram sup­ports the sick­est, most vul­ner­a­ble Medicare pa­tients and ac­counts for on­ly a small frac­tion of all Medicare spend­ing.  BIO will strong­ly op­pose short-sight­ed and harm­ful changes to a pro­gram that is so vi­tal to the health and well-be­ing of our se­niors.

In­ter­est­ing­ly, the Trump pro­pos­al isn’t be­ing ad­vanced as a rule-change, just a pro­pos­al for dis­cus­sion aimed at at­tract­ing at­ten­tion to an is­sue that plays well with his base of sup­port­ers. Re­pub­li­can law­mak­ers may not sup­port it, but with their fates in­ter­twined with the sen­si­tive pres­i­dent, crit­i­cism will be mut­ed. 

De­moc­rats on the oth­er hand may well leap at the chance to tack­le drug prices with the pres­i­dent.


Im­age: Pres­i­dent Don­ald Trump speaks at the De­part­ment of Health and Hu­man Ser­vices in Wash­ing­ton, DC, on Oc­to­ber 25, 2018 Nicholas Kamm  AFP

Take­da swoops in to buy lit­tle biotech part­ner and its celi­ac drug poised to 'change stan­dard of care'

Having spent three years carefully grooming PvP Biologics and its drug for celiac disease, Takeda is happy enough with the proof-of-concept data to buy it all.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 73,100+ biopharma pros reading Endpoints daily — and it's free.

Grow­ing ac­cep­tance of ac­cel­er­at­ed path­ways for nov­el treat­ments: but does reg­u­la­to­ry ap­proval lead to com­mer­cial suc­cess?

By Mwango Kashoki, MD, MPH, Vice President-Technical, and Richard Macaulay, Senior Director, of Parexel Regulatory & Access

In recent years, we’ve seen a significant uptake in the use of regulatory options by companies looking to accelerate the journey of life-saving drugs to market. In 2018, 73% of the novel drugs approved by the U.S. Federal Drug Administration (FDA) were designated under one or more expedited development program categories (Fast Track, Breakthrough Therapy, Priority Review, and Accelerated Approval).ᶦ

Mi­cro­bio­me Q&A: New study maps the vagi­na's 'op­ti­mal mi­cro­bio­ta' — and its im­pli­ca­tions for bio­phar­ma

The widely-held notion that the “optimal” vaginal microbiota is dominated by one strain of lactic-acid producing bacteria has now been challenged in a new paper, published in Nature Communications on Wednesday, which used advanced gene sequencing methods to map out the most comprehensive gene catalog of the human vaginal microbiome.

Things have changed in the more than 50 years since the concept of vaginal microbiota transplants was proposed and subsequently tainted by a Texas-based gynecologist who transplanted the vaginal fluid of women who had bacterial vaginosis into healthy females, suspecting he had isolated the bacteria responsible for the condition.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 73,100+ biopharma pros reading Endpoints daily — and it's free.

Fol­low­ing US, Chi­na hos­pi­tal ef­forts, Gilead plots its own PhI­II tri­als for close­ly watched Covid-19 drug

Gilead is launching its own Phase III trials of remdesivir, the repurposed antiviral that a WHO official called the “one drug right now we think may have real efficacy” against Covid-19 as the novel coronavirus originating from Wuhan, China ravages the world.

Announced just a day after the NIH and the University of Nebraska Medical Center registered their US-based trial online, Gilead’s program will comprise two studies enrolling around 1,000 patients beginning in March. They will recruit primarily in Asian countries but will also include patients from other locations with “high numbers of diagnosed cases,” the company said.

Bio­gen touts new ev­i­dence from the gene ther­a­py com­pa­ny it wa­gered $800M on

A year ago, Biogen made a big bet on a small gene therapy company. Now they have new evidence one of their therapies could work.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 73,100+ biopharma pros reading Endpoints daily — and it's free.

Anthony Fauci (AP Images)

UP­DAT­ED: NIH-part­nered Mod­er­na ships off its PhI-ready coro­n­avirus vac­cine can­di­date to a sea of un­cer­tain­ty

Off it goes.

Moderna has shipped the first batch of its mRNA vaccine against SARS-CoV-2 from its manufacturing facility in Norwood, Massachusetts, to the National Institute of Allergy and Infectious Diseases in Bethesda, Maryland, for a pioneering Phase I study.

It’s a hectic race against time. In the 42 days since Moderna selected the sequence they would use to develop their vaccine — a record time, no less — the number of confirmed cases around the world has surged astronomically from a few dozen to over 80,000, per WHO and Johns Hopkins estimates.

The candidate that they came up with, mRNA-1273, encodes for a prefusion stabilized form of the spike protein, which gives the virus its crown shape and plays a key role in transmission. The Coalition for Epidemic Preparedness Innovations, the Oslo-based group better known as CEPI, funded the manufacture of this batch.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 73,100+ biopharma pros reading Endpoints daily — and it's free.

In at least one life-sci hub, gen­der and di­ver­si­ty ini­tia­tives haven’t made a dent

Gender and racial diversity at the top of UK life science companies has hardly budged over the last seven years despite repeated advocacy efforts, according to a new report.

The report, from the recruiting firm Liftstream, found that 14.8% of directors on life sciences boards were women and 21.1% of top executives were women. That’s a modest bump from the 9.8% of directors and 18.1% of executives Liftstream identified in their last report from 2014. The percentage of women CEOs moved from 8% to 9.8%.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 73,100+ biopharma pros reading Endpoints daily — and it's free.

Will a 'risk-of­f' mind­set has­ten cell ther­a­py M&A? Io­vance surges on buy­out chat­ter

Is it time for some cell therapy M&A?

Investors of Iovance Biotherapeutics certainly thought so, sending its stock $IOVA up as much as 40% after Bloomberg reported that the cancer-focused biotech is talking to potential buyers.

While 2019 saw a number of high-profile gene therapy company takeovers — led by Roche’s $4.3 billion bid of Spark as Astellas went for Audentes, Biogen snapped up Nightstar and Vertex absorbed Exonics — large players appeared to prefer partnering on the cell therapy front, particularly when it comes to cancer. Hal Barron put his weight behind Rick Klausner’s startup as he rebuilt GlaxoSmithKline’s cancer pipeline. Takeda turned to MD Anderson to license their natural killer cell therapy.

One less ri­val for Im­muno­vant, as Alex­ion aban­dons FcRn in­hibitor

Less than one year after Alexion parted with $25 million upfront to secure access to a second anti-FcRn asset, it is abandoning the experimental drug. The discontinuation, disclosed at the SVB Leerink Global Healthcare Conference in New York during a fireside chat, bodes well for rival Immunovant.

The drug (ABY-039), partnered for development with Sweden’s Affibody, was forsaken on the basis of early-stage data that was not viewed favorably, Baird and SVB Leerink analysts noted.