In land­mark hear­ing, drug­mak­ers and law­mak­ers agree that US pol­i­cy on drug pric­ing is ripe for change — but there's no con­sen­sus on much else

Sev­en big phar­ma ex­ec­u­tives faced a pla­toon of US sen­a­tors on Tues­day, ex­pect­ing a dress­ing down on the in­dus­try’s track record of re­lent­less price hikes that has sparked bi­par­ti­san furor — but were in­stead treat­ed to a con­sci­en­tious de­bate, high on con­cern and low on con­tention.

Mat­ters kicked off with Sen­a­tor Ron Wyden ad­mon­ish­ing every bio­phar­ma rep­re­sen­ta­tive for their com­pa­ny’s tac­tics, in­clud­ing Ab­b­Vie pro­tect­ing its $18-bil­lion-a-year Hu­mi­ra from gener­ics like “Gol­lum with his ring,” and Pfiz­er for mak­ing the “emp­ti­est pric­ing ges­ture” by press­ing pause on hikes un­der pres­sure from Pres­i­dent Don­ald Trump for a pe­ri­od on­ly to re­sume lat­er.

He gave way to pre­pared re­marks from the com­pa­ny rep­re­sen­ta­tives: Ab­b­Vie chief $AB­BV Richard Gon­za­lez; As­traZeneca $AZN chief Pas­cal So­ri­ot; Bris­tol-My­ers $BMY chief Gio­van­ni Caforio; J&J’s $JNJ Janssen head Jen­nifer Taubert; Mer­ck $MRK chief Ken Fra­zier; Pfiz­er’s $PFE chief Al­bert Bourla and Sanofi $SNY chief Olivi­er Brandi­court.

Un­sur­pris­ing­ly, each ex­ec­u­tive blamed high list prices on the mid­dle­men: PBMs and in­sur­ers, sug­gest­ing that while the mag­ni­tude of re­bates of­fered by them were in­creas­ing, those ben­e­fits were not be­ing ac­crued to the pa­tient in the form of co-pays.

Fra­zier — Mer­ck’s fire­brand chief and de-fac­to leader of the un­like­ly troop of pan­elists thanks to his le­gal ex­per­tise (Fra­zier served as Mer­ck’s chief coun­sel back when it was fight­ing a flood of Vioxx law­suits) — al­so un­der­scored the fact that the is­sue of pric­ing is sys­temic to the US health­care sys­tem, lament­ing that pa­tients are ex­pect­ed to pay on av­er­age 13% in drug co-pays, but on­ly 3% of hos­pi­tal costs. 

Ken­neth Fra­zier, Chair­man and Chief Ex­ec­u­tive Of­fi­cer at Mer­ck, tes­ti­fies be­fore the Sen­ate Fi­nance Com­mit­tee hear­ing on drug prices on Tues­day, Feb. 26, 2019 (AP Pho­to/Pablo Mar­tinez Mon­si­vais)

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In gen­er­al, the drug­mak­ers voiced their sup­port for re­bate re­form. As­traZeneca’s So­ri­ot sug­gest­ed that on av­er­age, rough­ly 50% of his com­pa­ny’s list prices com­prise re­bates, and if they were to be dis­card­ed al­to­geth­er he would not be averse to cut­ting prices by the same mag­ni­tude. When asked point blank by more than one sen­a­tor about whether each ex­ec­u­tive would pledge to cut list prices if re­bates were elim­i­nat­ed, ex­ec­u­tives pro­posed cut­ting re­bates not just for Medicare but al­so on the com­mer­cial side to even the play­ing field for all drug man­u­fac­tur­ers, as suf­fi­cient in­cen­tive to low­er list prices.

An­oth­er so­lu­tion en­dorsed by the pan­el of drug­mak­ers was val­ue-based pric­ing.

Pfiz­er’s new­ly-mint­ed CEO Bourla told sen­a­tors he would pre­fer that the com­pa­ny be paid for “the heart at­tacks we pre­vent, and not the pills we sell.”  Al­though the con­cept is gain­ing trac­tion for new­er, high­er priced drugs, it has not uni­ver­sal­ly been adopt­ed. Mean­while, old­er drugs (in­clud­ing in­sulin that is sub­ject to fre­quent price hikes) are not in con­tention for such val­ue-based con­tracts.

Drug­mak­ers al­so ex­pressed en­thu­si­asm for shoring up biosim­i­lar and gener­ic com­pe­ti­tion in the Unit­ed States as a mech­a­nism to low­er drug prices.

Some pan­elists al­so en­dorsed the Cre­at­ing and Restor­ing Equal Ac­cess to Equiv­a­lent Sam­ples (CRE­ATES) Act — a bill de­signed to cre­ate a faster and more po­tent le­gal process for gener­ic man­u­fac­tur­ers to chal­lenge brand­ed drug­mak­ers that they claim are with­hold­ing drug sam­ples in or­der to ob­struct gener­ic com­pe­ti­tion. When sen­a­tors in­quired whether any of the drug­mak­ers at the hear­ing had any his­to­ry of block­ing drug sam­ples when to thwart copy­cat drug de­vel­op­ment, each de­clined that their com­pa­nies had en­gaged in any such prac­tices. But a cur­so­ry look at the FDA’s web­site sug­gests oth­er­wise.

The mood at the hear­ing was a mix­ture of cau­tious ad­mi­ra­tion for the in­dus­try for hav­ing de­vel­oped a pletho­ra of sci­en­tif­ic break­throughs, but in­cred­u­lous­ness that the Unit­ed States ef­fec­tive­ly shoul­ders the cost of in­no­va­tion, con­sid­er­ing oth­er West­ern in­dus­tri­al­ized na­tions — on av­er­age — pay low­er drug prices.

“Why are we a price tak­er, when we are the largest pur­chas­er?,” Sen­a­tor Bill Cas­sidy asked in one ex­change. An­oth­er sen­a­tor cit­ed sup­port for the Trump ad­min­is­tra­tion pro­pos­al to im­port drug prices from over­seas, but was im­me­di­ate­ly re­buffed by the drug­mak­ers who ar­gued that a num­ber of these na­tions do not ac­cept new med­i­cines due to their pric­ing poli­cies, of­ten re­strict­ing ac­cess or de­clin­ing to adopt them al­to­geth­er.

Al­though drug­mak­ers were asked whether their tax breaks — en­gi­neered by the Trump ad­min­is­tra­tion — had been used to cut prices, the phar­ma­ceu­ti­cal com­pa­nies large­ly ac­knowl­edged that the sav­ings had large­ly not been used in that fash­ion.

The main vil­lain of the hear­ing was Ab­b­Vie chief Gon­za­lez, who was per­sis­tent­ly called out for his com­pa­ny’s patent-ag­gres­sive ap­proach to pro­tect­ing their biggest, most lu­cra­tive as­set Hu­mi­ra — the world’s largest sell­ing drug whose main US patent ran out in 2016. Gon­za­lez’s main talk­ing point was that that while some Eu­ro­pean na­tions have bagged an 80% dis­count on Hu­mi­ra, the US price (and sales) is what keeps the com­pa­ny’s R&D en­gine hot.

Per­sis­tent ques­tions by one sen­a­tor to adopt Cost­co-style pric­ing — get­ting sales via vol­ume ver­sus pric­ing — got a tepid re­sponse from pan­elists. But, one pro­pos­al did whet pan­elist ap­petites. Sen­a­tor Shel­don White­house called out the bad ac­tors and “non-in­no­va­tors” of the in­dus­try (re­mem­ber Shkre­li, the poster boy of bad, smug biotech?) that buy off-patent drugs used in con­di­tions with few or no treat­ment op­tions and jack up their prices cre­at­ing a mo­nop­oly and hang­ing pa­tients who use these decades-old treat­ments out to dry. When we try to crack down against these ac­tors, White­house said, your lob­by­ists push­back. “Help us at least solve that prob­lem…turn off your lawyers and your lob­by­ists!” he said to the nod­ding heads of in­dus­try reps. “We will,” Fra­zier re­spond­ed.

Ear­li­er on, Sen­a­tor Bob Menen­dez made a thin­ly veiled threat to the crop of pan­elists be­fore him, sug­gest­ing that if drug­mak­ers were un­will­ing to rein in prices, “pol­i­cy­mak­ers are go­ing to do it for you.”  At the end of the pro­ceed­ings, the pan­elists large­ly agreed. The “gov­ern­ment has to step up and change the rules,” So­ri­ot said. Now there’s just the small mat­ter of fig­ur­ing out how to do that.

Nick Leschly via Getty

UP­DAT­ED: Blue­bird shares sink as an­a­lysts puz­zle out $1.8M stick­er shock and an un­ex­pect­ed de­lay

Blue­bird bio $BLUE has un­veiled its price for the new­ly ap­proved gene ther­a­py Zyn­te­glo (Lenti­Glo­bin), which came as a big sur­prise. And it wasn’t the on­ly un­ex­pect­ed twist in to­day’s sto­ry.

With some an­a­lysts bet­ting on a $900,000 price for the β-tha­lassemia treat­ment in Eu­rope, where reg­u­la­tors pro­vid­ed a con­di­tion­al ear­ly OK, blue­bird CEO Nick Leschly said Fri­day morn­ing that the pa­tients who are suc­cess­ful­ly treat­ed with their drug over 5 years will be charged twice that — $1.8 mil­lion — on the con­ti­nent. That makes this drug the sec­ond most ex­pen­sive ther­a­py on the plan­et, just be­hind No­var­tis’ new­ly ap­proved Zol­gens­ma at $2.1 mil­lion, with an­a­lysts still wait­ing to see what kind of pre­mi­um can be had in the US.

Gene ther­a­pies seize the top of the list of the most ex­pen­sive drugs on the plan­et — and that trend has just be­gun

Anyone looking for a few simple reasons why the gene therapy field has caught fire with the pharma giants need only look at the new list of the 10 most expensive therapies from GoodRx.

Two recently approved gene therapies sit atop this list, with Novartis’ Zolgensma crowned the king of the priciest drugs at $2.1 million. Right below is Luxturna, the $850,000 pioneer from Spark, which Roche is pushing hard to acquire as it adds a gene therapy group to the global mix.

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Ted Love. HAVERFORD COLLEGE

Glob­al Blood Ther­a­peu­tics poised to sub­mit ap­pli­ca­tion for ac­cel­er­at­ed ap­proval, with new piv­otal da­ta on its sick­le cell dis­ease drug

Global Blood Therapeutics is set to submit an application for accelerated approval in the second-half of this year, after unveiling fresh data from a late-stage trial that showed just over half the patients given the highest dose of its experimental sickle cell disease drug experienced a statistically significant improvement in oxygen-wielding hemoglobin, meeting the study's main goal.

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J&J gains an en­thu­si­as­tic en­dorse­ment from Pres­i­dent Don­ald Trump for their big new drug Spra­va­to

Pres­i­dent Don­ald Trump has lit­tle love for Big Phar­ma, but there’s at least one new drug that just hit the mar­ket which he is en­am­ored with.

Trump, ev­i­dent­ly, has been read­ing up on J&J’s new an­ti-de­pres­sion drug, Spra­va­to. And the pres­i­dent — who of­ten likes to break out in­to a full-throat­ed at­tack on greedy drug­mak­ers — ap­par­ent­ly en­thused about the ther­a­py in a meet­ing with of­fi­cials of Vet­er­ans Af­fairs, which has long grap­pled with de­pres­sion among vet­er­ans.

In a boost to Rit­ux­an fran­chise, Roche nabs quick ap­proval for po­latuzum­ab ve­dotin

Roche’s lat­est an­ti­body-drug con­ju­gate has crossed the FDA fin­ish line, gain­ing an ac­cel­er­at­ed ap­proval a full two months ahead of sched­ule.

Po­livy, or po­latuzum­ab ve­dotin, is a first-in-class drug tar­get­ing CD79b — a pro­tein promi­nent in B-cell non-Hodgkin lym­phoma. It will now be mar­ket­ed for dif­fuse large B-cell lym­phoma as part of a reg­i­men that al­so in­cludes the chemother­a­py ben­damus­tine and a ver­sion of rit­ux­imab (Rit­ux­an).

An in­censed Cat­a­lyst Phar­ma sues the FDA, ac­cus­ing agency of bow­ing to po­lit­i­cal pres­sure and break­ing fed­er­al law

Af­ter hint­ing it was ex­plor­ing the le­gal­i­ty of the FDA’s ap­proval of a ri­val drug from fam­i­ly-run com­pa­ny Ja­cobus Phar­ma­ceu­ti­cals, Cat­a­lyst Phar­ma­ceu­ti­cals on Wednes­day filed a law­suit against the health reg­u­la­tor — ef­fec­tive­ly ac­cus­ing the agency of bow­ing to po­lit­i­cal pres­sure sur­round­ing sky­rock­et­ing drug prices.

Be­fore Cat­a­lyst’s Fir­dapse (which car­ries an av­er­age an­nu­al list price of $375,000) was sanc­tioned for use in Lam­bert-Eaton myas­thenic syn­drome (LEMS) by the FDA, hun­dreds of pa­tients had been able to ac­cess a sim­i­lar drug from com­pound­ing phar­ma­cies for a frac­tion of the cost, or Ja­cobus’ for free, as part of an FDA-rat­i­fied com­pas­sion­ate use pro­gram. But the ap­proval of the Cat­a­lyst drug — ac­com­pa­nied by mar­ket ex­clu­siv­i­ty span­ning sev­en years — ef­fec­tive­ly pre­clud­ed Ja­cobus and com­pound­ing phar­ma­cies from sell­ing their ver­sions.

Plagued by de­lays, As­traZeneca HQ costs soar to £750M as it edges to­ward 2020 com­ple­tion

In the lat­est up­date on As­traZeneca’s de­lay-prone HQ project, the phar­ma gi­ant re­vealed that the cost of con­struc­tion has swelled to £750 mil­lion ($956 mil­lion) — more than dou­ble the orig­i­nal es­ti­mate in 2013.

The move-in date is still in 2020, a spokesper­son con­firmed, af­ter As­traZeneca pushed pro­ject­ed com­ple­tion from 2016 to 2017, and then to the spring of 2019. While the ini­tial plan called for a £330 mil­lion (then $500 mil­lion) in­vest­ment, the cost bal­looned to £500 mil­lion ($650 mil­lion), and more in the most re­cent up­date.

Fresh analy­sis spot­lights car­dio ben­e­fit of J&J's In­vokana in di­a­betes pa­tients with­out his­to­ry of CV dis­ease

In­vokana sales may be mut­ed, but the di­a­betes drug is set to get some love af­ter its mak­er J&J un­veiled da­ta at the Amer­i­can Di­a­betes As­so­ci­a­tion meet­ing on Tues­day sug­gest­ing the med­i­cine can con­fer a car­dio­vas­cu­lar ben­e­fit in pa­tients who do not have pre­ex­ist­ing CV dis­ease.

Back in April, J&J had re­port­ed that in the late-stage CRE­DENCE study, the SGLT2 drug scored a 30% re­duc­tion in the risk of a com­pos­ite of ail­ments: a pro­gres­sion to the dou­bling of serum cre­a­ti­nine, end-stage kid­ney dis­ease and re­nal or car­dio­vas­cu­lar death. In terms of sec­ondary end­points, the drug was al­so found be heart-pro­tec­tive: low­er­ing the risk of CV death and hos­pi­tal­iza­tion for heart fail­ure by 31%, as well as ma­jor ad­verse CV events by 20%. In March, the com­pa­ny sub­mit­ted an ap­pli­ca­tion to ex­pand In­vokana’s la­bel to re­flect its im­pact on chron­ic kid­ney dis­ease.

Sil­i­con Val­ley's most an­tic­i­pat­ed slide deck just dropped. What does it mean for bio­phar­ma's dig­i­tal teams?

These aren’t the typ­i­cal slides you’d see at End­points — no mol­e­cules, clin­i­cal pro­grams, or p-val­ues. In­stead, we’ll talk dig­i­tal and in­ter­net trends, fac­tors that elite glob­al brands — re­gard­less of in­dus­try — must first mea­sure and un­der­stand be­fore de­ploy­ing prod­ucts in­to the world. That’s a con­cept that most of our Big Phar­ma au­di­ence is in tune with. Dig­i­tal aware­ness is key to suc­cess in the dis­cov­ery, de­vel­op­ment, and mar­ket­ing of new bio­phar­ma­ceu­ti­cals, and most of the ma­jors now have a chief dig­i­tal of­fi­cer: No­var­tis, Sanofi, and Pfiz­er, just to name a few.