Opin­ion: The drug pric­ing deal is­n't re­al­ly a vic­to­ry for Dems, or a loss for PhRMA. But it could be a har­bin­ger of change

Al­though House and Sen­ate De­moc­rats have fi­nal­ly cracked their Mis­sion: Im­pos­si­ble to al­low the fed­er­al gov­ern­ment to ne­go­ti­ate some drug prices, the ne­go­ti­a­tions will in­clude so few drugs and have so many stip­u­la­tions at­tached that the end re­sult may be more of a drop in the ocean than the mon­soon that drug price ne­go­ti­a­tions could’ve been.

Con­gress is wait­ing for a CBO score be­fore of­fi­cial­ly vot­ing, but ear­ly es­ti­mates point to about $100 bil­lion in drug pric­ing sav­ings over ten years from the deal. That’s ba­si­cal­ly the equiv­a­lent of what the phar­ma in­dus­try spends on DTC mar­ket­ing over a decade. Or about five years of what phar­ma com­pa­nies spend on mar­ket­ing to health care pro­fes­sion­als.

The Medicare ne­go­ti­a­tions deal is al­so com­pli­cat­ed by ex­ten­sive lim­i­ta­tions — it’s on­ly for ex­pen­sive Medicare Part D and B drugs, 10 to start, the drugs must have no gener­ic/biosim­i­lar com­peti­tors, and the ne­go­ti­a­tions can on­ly start post-ex­clu­siv­i­ty, or 9 years af­ter the launch of small mol­e­cule drugs and 13 years for bi­o­log­ics. It’s un­clear what kind of dent, if any, the deal will make on drug prices over the longer term, or for those out­side of Medicare.

“CMS will de­ter­mine the fi­nal price, based on cri­te­ria that are rather pro-in­dus­try – thus it seems more of a no­tice-and-com­ment rather than ac­tu­al ne­go­ti­a­tion,” Bern­stein biotech an­a­lyst Ron­ny Gal wrote in a re­cent in­vestor note. “Our ear­ly im­pres­sion is that the net im­pact is pos­i­tive for phar­ma stocks.”

Mean­while, in­dus­try group PhRMA, which suc­cess­ful­ly flood­ed Capi­tol Hill with 20 lob­by­ists for every sen­a­tor, is once again disin­gen­u­ous­ly cry­ing foul. This is typ­i­cal of PhRMA, which of­ten makes a big, pub­lic stink about al­ready-lim­it­ed bills while wa­ter­ing them down fur­ther be­hind closed doors.

And phar­ma com­pa­nies, fa­mous for hir­ing teams of lawyers to find loop­holes in com­plex statute, will sure­ly nav­i­gate their way around at least some of the ne­go­ti­a­tions, or po­ten­tial­ly forge deals to bring more in­nocu­ous com­pe­ti­tion to mar­ket more quick­ly so as to avoid any ne­go­ti­a­tions at all.

But these side ef­fects (pun in­tend­ed) of the ne­go­ti­a­tions deal might ac­tu­al­ly be a good thing. And al­though the num­bers might be a drop in the ocean, and the ne­go­ti­a­tions them­selves slant­ed in phar­ma’s fa­vor, the deal still dis­rupts the woe­ful­ly in­ad­e­quate sta­tus quo.

Rachel Sachs, a law pro­fes­sor at Wash­ing­ton Uni­ver­si­ty in St. Louis who stud­ies drug pric­ing and in­no­va­tion, said she didn’t think com­pa­nies po­ten­tial­ly bring­ing in more com­pe­ti­tion pri­or to the gov­ern­ment ne­go­ti­a­tions start­ing “would be a bad out­come, from a pol­i­cy per­spec­tive, par­tic­u­lar­ly if we end up with more than one com­peti­tor to dri­ve down prices. It might al­so cut down on the need for some pay-for-de­lay or cit­i­zen pe­ti­tion re­form.”

Pe­ter Bach

Oth­er drug pric­ing ex­perts like Pe­ter Bach have al­so come out in fa­vor of the deal’s abil­i­ty to ne­go­ti­ate prices post-ex­clu­siv­i­ty, rather than when the drugs launch, the lat­ter of which is typ­i­cal in Eu­ro­pean coun­tries.

“Fo­cus­ing on drugs that have logged years on the mar­ket means there will be more (and in many cas­es clear) ev­i­dence of how well drugs work. Rarely true at launch,” he wrote. “This is where the mon­ey is.”

And Bach in­sist­ed to me that is the right step and tar­get­ing the right prob­lem:

So much mon­ey is in the top ex­pen­di­ture drugs that fo­cus­ing there — and thus us­ing ne­go­ti­at­ing re­sources ef­fi­cient­ly — makes sense. I know the push and pull of pol­i­tics and n[um­ber] of drugs and stuff makes for good the­atre, but my ques­tion is where are we com­pared to where we were 5 years ago when no­body knew what a re­bate was or that the biosim­i­lar mar­ket was de­signed to fail or that long mo­nop­o­lies were not just a lit­tle long, they were gen­er­a­tions long.

Ul­ti­mate­ly, if De­moc­rats are able to shep­herd their ne­go­ti­a­tions deal across the fin­ish line (and they’re ex­pect­ed to), the net ef­fect won’t be in­stan­ta­neous sav­ings or the col­lapse of the bio­phar­ma in­dus­try, but per­haps an sign­post on the way to­ward a more sus­tain­able path.

MedTech clinical trials require a unique regulatory and study design approach and so engaging a highly experienced CRO to ensure compliance and accurate data across all stages is critical to development milestones.

In­no­v­a­tive MedTech De­mands Spe­cial­ist Clin­i­cal Tri­al Reg­u­la­to­ry Af­fairs and De­sign

Avance Clinical is the Australian CRO for international biotechs providing world-class clinical research services with FDA-accepted data across all phases. With Avance Clinical, biotech companies can leverage Australia’s supportive clinical trials environment which includes no IND requirement plus a 43.5% Government incentive rebate on clinical spend. The CRO has been delivering clinical drug development services for international biotechs for FDA and EMA regulatory approval for the past 24 years. The company has been recognized for the past two consecutive years with the prestigious Frost & Sullivan CRO Best Practices Award and a finalist in Informa Pharma’s Best CRO award for 2022.

His­toric drug pric­ing re­forms pass; Pfiz­er ac­quires GBT; The long search for non-opi­oid pain drugs; 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.

The Endpoints Weekly has officially crossed the 60,000 mark on subscribers — thanks to all of your support. As the editorial team grows, we’ve been able to do a lot more, with many of those on display this week. Be sure to check out Lei Lei Wu’s deep dive on pain R&D. If you missed it, you may also rewatch her companion panel here.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.

Gold for adults, sil­ver for in­fants: Pfiz­er's Pre­vnar 2.0 head­ed to FDA months af­ter Mer­ck­'s green light

Pfizer was first to the finish line for the next-gen pneumococcal vaccine in adults, but Merck beat its rival with a jab for children in June.

Now, two months after Merck’s 15-valent Vaxneuvance won the FDA stamp of approval for kids, Pfizer is out with some late-stage data on its 20-valent shot for infants.

Known as Prevnar 20 for adults, Pfizer’s 20vPnC will head to the FDA by the end of this year for an approval request in infants, the Big Pharma said Friday morning. Discussions with the FDA will occur first and more late-stage pediatric trials are expected to read out soon, informing the regulatory pathway in other countries and regions.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.

No­var­tis re­ports two pa­tient deaths af­ter treat­ment with Zol­gens­ma

Two children with spinal muscular atrophy have died after receiving Novartis’ Zolgensma, a gene therapy designed as a one-time treatment for the rare fatal disease.

The deaths, which resulted from acute liver failure, occurred in Russia and Kazakhstan, Novartis confirmed in a statement to Endpoints News. Having notified health authorities across all the markets where Zolgensma is available, it will update the drug label “to specify that fatal acute liver failure has been reported,” a spokesperson wrote.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.

FDA ap­proves sec­ond in­di­ca­tion for As­traZeneca and Dai­ichi's En­her­tu in less than a week

AstraZeneca and Daiichi Sankyo’s antibody-drug conjugate Enhertu scored its second approval in less than a week, this time for a subset of lung cancer patients.

Enhertu received accelerated approval on Thursday to treat adults with unresectable or metastatic non-small cell lung cancer (NSCLC) whose tumors have activating HER2 (ERBB2) mutations, and who have already received a prior systemic therapy.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.

Senate Finance Committee Chair Ron Wyden (D-OR) (Francis Chung/E&E News/POLITICO via AP Images)

Sen­ate Fi­nance chair con­tin­ues his in­ves­ti­ga­tion in­to phar­ma tax­es with re­quests for Am­gen

Amgen is the latest pharma company to appear on the radar of Senate Finance Committee Chair Ron Wyden (D-OR), who is investigating the way pharma companies are using subsidiaries in low- or zero-tax countries to lower their tax bills.

Like its peers Merck, AbbVie and Bristol Myers Squibb, Wyden notes how Amgen uses its Puerto Rico operations to consistently pay tax rates that are substantially lower than the U.S. corporate tax rate of 21%, with an effective tax rate of 10.7% in 2020 and 12.1% in 2021.

J&J to re­move talc prod­ucts from shelves world­wide, re­plac­ing with corn­starch-based port­fo­lio

After controversially spinning out its talc liabilities and filing for bankruptcy in an attempt to settle 38,000 lawsuits, Johnson & Johnson is now changing up the formula for its baby powder products.

J&J is beginning the transition to an all cornstarch-based baby powder portfolio, the pharma giant announced on Thursday — just months after a federal judge ruled in favor of its “Texas two-step” bankruptcy to settle allegations that its talc products contained asbestos and caused cancer. An appeals court has since agreed to revisit that case.

CSL is gathering its four business units under a unified brand identity strategy (Credit: CSL company site)

CSL brings Se­qirus, Vi­for un­der par­ent um­brel­la brand in iden­ti­ty re­vamp

CSL is gathering its brands under the family name umbrella, renaming its vaccine and newly acquired nephrology specialty businesses with the parent initials.

CSL Seqirus and CSL Vifor join CSL Plasma and CSL Behring as the four now uniformly branded business units of the global biopharma. The Seqirus vaccine division was formed in 2015 with the combination of bioCSL and its purchase of Novartis’ flu vaccine business. CSL picked up Vifor Pharma late last year in an $11.7 billion deal for the nephrology, iron deficiency and cardio-renal drug developer.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.

Elcin Barker Ergun, Menarini Group CEO

Amid Roche and Sanofi's oral SERD set­backs, Menar­i­ni gets speedy re­view at FDA

Menarini and Radius Health are getting a speedy review at the FDA for their oral SERD breast cancer drug months after the field opened up with competitors failing and fleeing.

It was a one-two-three punch in March, April and May as Sanofi flunked its first big test for its oral selective estrogen receptor degrader (SERD), Roche also flamed out in a Phase II and G1 Therapeutics ended its program after scoping out the data and potential partners.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 147,700+ biopharma pros reading Endpoints daily — and it's free.