Xavier Becerra, HHS Secretary (Greg Nash/Pool via AP Images)

HHS lines up No­var­tis, Lil­ly, As­traZeneca and 3 oth­er drug­mak­ers for fines due to drug dis­count vi­o­la­tions

As drug­mak­ers con­tin­ue to bat­tle Pres­i­dent Biden’s HHS in court over al­leged 340B drug dis­count vi­o­la­tions, HHS sent let­ters on Wednes­day to six com­pa­nies in­form­ing them that their vi­o­la­tions have been re­ferred to the HHS Of­fice of the In­spec­tor Gen­er­al, which can levy $5,000 fines each.

At is­sue is whether the com­pa­nies have to of­fer dis­count pric­ing to safe­ty-net providers through cer­tain con­tract phar­ma­cy part­ner­ships. The com­pa­nies, in­clud­ing No­var­tis, Eli Lil­ly, As­traZeneca, No­vo Nordisk, Sanofi, and Unit­ed Ther­a­peu­tics, have raised con­cerns that the 340B drug dis­count pro­gram has grown be­yond what it was ini­tial­ly tasked to do, and now lines the pock­ets of cov­ered hos­pi­tals and oth­er providers. The com­pa­nies al­so de­cid­ed to stop of­fer­ing the low­ered prices to some con­tract phar­ma­cies.

In May, HHS told the com­pa­nies to com­ply with its 340B statu­to­ry oblig­a­tions and to im­me­di­ate­ly be­gin of­fer­ing cov­ered out­pa­tient drugs at the 340B ceil­ing price to cov­ered en­ti­ties. But Lil­ly, No­vo Nordisk, and No­var­tis sub­se­quent­ly sued HHS, claim­ing the statute doesn’t re­quire them to work with such con­trac­tors.

Lil­ly spokesper­son An­toinette Forbes told End­points News: “We are dis­ap­point­ed to see HRSA’s con­tin­ued at­tempt to cir­cum­vent the le­gal process.”

“Noth­ing in the statute con­tem­plates — let alone re­quires — that man­u­fac­tur­ers agree to ship drugs nom­i­nal­ly pur­chased by cov­ered en­ti­ties di­rect­ly to ‘con­tract phar­ma­cies’ for dis­pens­ing to both pa­tients and non-pa­tients of the cov­ered en­ti­ty alike. And yet that is pre­cise­ly what HRSA has pur­port­ed to man­date here,” No­var­tis said in its suit.

No­var­tis spokesper­son Caryn Mar­shall al­so told End­points that it’s “con­fi­dent” its 340B pol­i­cy “is in full com­pli­ance with the 340B statute and all bind­ing reg­u­la­tions.”

But HHS is push­ing ahead with the fines re­gard­less, con­clud­ing these ac­tions vi­o­late the 340B statute, and the OIG now will de­ter­mine whether the com­pa­nies are li­able for “know­ing­ly and in­ten­tion­al­ly” over­charg­ing 340B hos­pi­tals and oth­er providers.

Oth­ers that re­ceived the let­ters main­tain that they’re act­ing in com­pli­ance with the law.

Nico­las Kress­mann, spokesman for Sanofi, told End­points the com­pa­ny has been look­ing in­to 340B-priced claims since Oc­to­ber 2020 and that it will pay Med­ic­aid and oth­er in­sur­ers’ re­bate in­voic­es ac­cu­rate­ly. “We con­tin­ue to be­lieve this in­tegri­ty ini­tia­tive com­plies with the 340B statute,” he said.

Michael Bach­n­er, spokesper­son for No­vo Nordisk, added that his com­pa­ny “dis­agrees with the claims made by HRSA in its let­ter, which are al­so the sub­ject of pend­ing lit­i­ga­tion com­menced by No­vo Nordisk and sev­er­al oth­er man­u­fac­tur­ers. We stand be­hind the poli­cies we have put in place to ad­dress the sig­nif­i­cant and well-doc­u­ment­ed abus­es in the 340B pro­gram, re­sult­ing in pro­gram in­ter­me­di­aries such as for prof­it con­tract phar­ma­cies prof­it­ing at the ex­pense of pa­tients.”

At the In­flec­tion Point for the Next Gen­er­a­tion of Can­cer Im­munother­a­py

While oncology researchers have long pursued the potential of cellular immunotherapies for the treatment of cancer, it was unclear whether these therapies would ever reach patients due to the complexity of manufacturing and costs of development. Fortunately, the recent successful development and regulatory approval of chimeric antigen receptor-engineered T (CAR-T) cells have demonstrated the significant benefit of these therapies to patients.

All about Omi­cron; We need more Covid an­tivi­rals; GSK snags Pfiz­er’s vac­cine ex­ec; Janet Wood­cock’s fu­ture at FDA; and more

Welcome back to Endpoints Weekly, your review of the week’s top biopharma headlines. Want this in your inbox every Saturday morning? Current Endpoints readers can visit their reader profile to add Endpoints Weekly. New to Endpoints? Sign up here.

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Usama Malik

Ex-Im­munomedics CFO charged with in­sid­er trad­ing, faces up to 20 years in prison af­ter al­leged­ly tip­ping off girl­friend and rel­a­tives of a PhI­II suc­cess

The former CFO of Immunomedics, who helped steer the company to its $21 billion buyout by Gilead last year, has been charged with insider trading, the Department of Justice announced Thursday.

Usama Malik tipped off his then-girlfriend and four others that a Phase III study for Trodelvy would be stopped early four days before Immunomedics publicly announced the result in April 2020, DoJ alleged in its complaint. The individuals then purchased Immunomedics shares, selling them after the news broke and Immunomedics’ stock price doubled.

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Merck's new antiviral molnupiravir (Quality Stock Arts / Shutterstock)

As Omi­cron spread looms, oral an­tivi­rals ap­pear to be one of the best de­fens­es — now we just need more

After South African scientists reported a new Covid-19 variant — dubbed Omicron by the WHO — scientists became concerned about how effective vaccines and monoclonal antibodies might be against it, which has more than 30 mutations in the spike protein.

“I think it is super worrisome,” Dartmouth professor and Adagio co-founder and CEO Tillman Gerngross told Endpoints News this weekend. Moderna CEO Stéphane Bancel echoed similar concerns, telling the Financial Times that experts warned him, “This is not going to be good.”

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Ab­b­Vie tacks on a new warn­ing to Rin­voq la­bel as safe­ty frets crimp JAK class

The safety problems that continue to plague the JAK class as new data highlight some severe side effects are casting a large shadow over AbbVie’s Rinvoq.

As a result of a recent readout highlighting major adverse cardiac events (MACE), malignancy, mortality and thrombosis with Xeljanz a couple of months ago, AbbVie put out a notice late Friday afternoon that it is adding the new class risks to its label for their rival drug.

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Nurses star in J&J's campaign centered on the importance of nurses who are increasingly stressed, burnt out and quitting the profession (via Johnson & Johnson)

Thank­ful for nurs­es: J&J's new cam­paign aims to re­set pan­dem­ic clock back to grat­i­tude

In the early days of the pandemic, people cheered for nurses – delivering food, writing thank you notes and ringing bells nightly to show their appreciation. But something shifted this summer, and now Johnson & Johnson wants to remind people of the gratitude that nurses still deserve.

Call it politics or pandemic weariness or the result of almost two years of a deadly pandemic, but nurses today face threats and mistreatment from patients and their angry family members. And nurses are leaving the profession in record numbers.

Biospec­i­men M&A: Dis­cov­ery ac­quires Al­bert Li's he­pa­to­cyte project; PhI­II tri­al on Bay­er's Nube­qa reached pri­ma­ry end­point

Discovery Life Sciences has acquired what claims to be the Maryland-based host of the world’s largest hepatocyte inventory, known as IVAL, to help researchers select more effective and safer drug candidates in the future.

The combined companies will now serve a wider range of drug research and development scientists, according to Albert Li, who founded IVAL in 2004 and is set to join the Discovery leadership team as the CSO of pharmacology and toxicology.

Pfiz­er, Am­gen and Janssen seek fur­ther clar­i­ty on FDA's new ben­e­fit-risk guid­ance

Three top biopharma companies are seeking more details from the FDA on how the agency conducts its benefit-risk assessments for new drugs and biologics.

While Pfizer, Amgen and Janssen praised the agency for further spelling out its thinking on the subject in a new draft guidance, including a discussion of patient experience data as part of the assessment, the companies said the FDA could’ve included more specifics in the 20-page draft document.

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Drug­mak­ers cut prices on av­er­age by more than 60% to get on Chi­na's 2022 NDRL list — re­port

China’s National Reimbursement Drug List (NRDL) is a crystal clear example of the country’s bargaining power in the biotech and pharma market, as more firms have reportedly agreed to cut their prices for 67 new medicines to be included in its national medical insurance coverage starting in January.

Being on the list is lucrative. Essentially, if a biotech or pharma company gets on this list, they’re covered by the biggest insurance network in the country. Given China’s vast population, the Chinese government has significant leverage to decide which medicines can make a profit. While domestic drugmakers are quite willing to play that game, cutting prices significantly in exchange for getting on the list, international companies don’t do it as often.