Pelosi drug pric­ing bill promis­es sav­ings, but could gag R&D — CBO analy­sis

The De­moc­rats’ drug pric­ing bill — un­veiled by Speak­er Nan­cy Pelosi last month — could save Medicare spend­ing by $345 bil­lion over a sev­en-year pe­ri­od, a new analy­sis sug­gests. But the ven­omous cli­mate of im­peach­ment pro­ceed­ings and the in­ten­si­fy­ing dis­cord be­tween the De­mo­c­rat-con­trolled House and Re­pub­li­can-ma­jor­i­ty Sen­ate por­tends the bill will un­like­ly ever be­come law.

Tech­ni­cal­ly, both sides of the aisle agree drug prices in the Unit­ed States need some low­er­ing. The De­moc­rats’ bill, H.R.3 – Low­er Drug Costs Now Act of 2019, is en­gi­neered to em­pow­er the HHS to ne­go­ti­ate prices for the 125 most ex­pen­sive pre­scrip­tion drugs with­out at least two com­peti­tors — the Trump ad­min­is­tra­tion has al­ready backed such a mea­sure for the Vet­er­ans As­so­ci­a­tion. Un­der the bill, prices for this cat­e­go­ry of med­i­cines are not in­tend­ed to ex­ceed 120% of the av­er­age price in cer­tain oth­er coun­tries (Aus­tralia, Cana­da, France, Ger­many and the Unit­ed King­dom), akin to a pro­pos­al float­ed by Trump ear­li­er this year, which sug­gest­ed prices be pegged against what oth­er na­tions were pay­ing as part of an “in­ter­na­tion­al pric­ing in­dex”.

Apart from un­der­stand­ably elic­it­ing the ire of the bio­phar­ma in­dus­try — which holds the crown for the least fa­vored sec­tor by Amer­i­cans, falling be­hind the fed­er­al gov­ern­ment it­self — the bill has al­so met with crit­i­cism from mem­bers of the GOP. The dis­sent — shared by both fac­tions — stems from the be­lief that the ini­tia­tive would in­evitably chill in­vest­ment in phar­ma­ceu­ti­cal re­search and sti­fle in­no­va­tion.

In the fresh, but pre­lim­i­nary, analy­sis pub­lished on Fri­day by the Con­gres­sion­al Bud­get Of­fice (CBO), the bill would not on­ly cut fed­er­al di­rect spend­ing for Medicare by $345 bil­lion over the 2023-2029 pe­ri­od but would change the com­plex­ion of the drug mar­ket by chang­ing in­cen­tives that man­u­fac­tur­ers cur­rent­ly en­joy.

“A man­u­fac­tur­er that was dis­sat­is­fied with a ne­go­ti­a­tion could pull a drug out of the U.S. mar­ket en­tire­ly, though CBO ex­pects that would be un­like­ly for drugs al­ready be­ing sold in the Unit­ed States. Man­u­fac­tur­ers would ini­tial­ly set list prices of some new drugs in the U.S. high­er than un­der ex­ist­ing law, al­though the net prices paid by con­sumers over time could be low­er in many such cas­es,” the re­port said.

The CBO al­so cau­tioned that the bill could al­so mo­ti­vate man­u­fac­tur­ers to spike drug prices in coun­tries out­side the Unit­ed States to make up for lost rev­enue, or not sell cer­tain med­i­cines at all out­side the Unit­ed States to elim­i­nate ref­er­ence prices for US ne­go­ti­a­tions.

PhRMA, a pow­er­ful phar­ma lob­by group, took is­sue with this claim. “This re­flects a lack of un­der­stand­ing of for­eign pric­ing sys­tems, which have laws and reg­u­la­tions that pro­hib­it man­u­fac­tur­ers from uni­lat­er­al­ly set­ting prod­uct prices and/or in­creas­ing the prices of prod­ucts,” a spokesper­son not­ed in an email to End­points News.

The CBO’s analy­sis al­so mir­rored some of the con­cerns ex­pressed by Re­pub­li­cans. Al­though in the short term low­er prices will en­hance ac­cess to med­i­cines and im­prove health — over the longer term,  di­min­ished spend­ing on re­search and de­vel­op­ment will cul­mi­nate in the in­tro­duc­tion of few­er new drugs, the re­port pre­dict­ed.

Al­though the CBO’s analy­sis of the bill is not com­plete, “its pre­lim­i­nary es­ti­mate is that a re­duc­tion in rev­enues of $0.5 tril­lion to $1 tril­lion would lead to a re­duc­tion of ap­prox­i­mate­ly 8 to 15 new drugs com­ing to mar­ket over the next 10 years. The over­all ef­fect on the health of fam­i­lies in the Unit­ed States that would stem from in­creased use of pre­scrip­tion drugs but de­creased avail­abil­i­ty of new drugs is un­clear.”

These cal­cu­la­tions were based on the premise that the FDA ap­proves, on av­er­age, about 30 new drugs an­nu­al­ly. In 2018, the US agency cleared 59 drugs; in 2017, it ap­proved 46; and in 2016 the num­ber was 22. So far this year, the reg­u­la­tor has green-light­ed 30.

“It takes an av­er­age of 10-12 years to de­vel­op a new med­i­cine so the biggest im­pact on in­no­va­tion will oc­cur out­side of the ten-year bud­get win­dow,” the PhRMA spokesper­son added.

Sep­a­rate­ly, an analy­sis by the CMS sug­gest­ed that the bill could cur­tail to­tal US spend­ing on health­care by about $480 bil­lion over a decade — sav­ing Amer­i­can house­holds rough­ly $158 bil­lion in low­er pre­mi­ums and small­er out-of-pock­et costs.

Source: CMS, 2019

Click on the im­age to see the full-sized ver­sion

Ear­li­er this month, Trump claimed that the phar­ma­ceu­ti­cal in­dus­try was be­hind the im­peach­ment in­quiry from House De­moc­rats, with­out of­fer­ing any ev­i­dence to sup­port his as­ser­tion.

“Does Trump’s al­lu­sion to Big Phar­ma’s role as the bankroller of the im­peach­ment “hoax” get con­demned by the oth­er side, there­by de­fend­ing phar­ma? That prob­a­bly won’t hap­pen, but we are be­gin­ning to think the util­i­ty of phar­ma as a po­lit­i­cal punch­ing bag may be start­ing to wear thin giv­en the ab­sur­di­ty of this lat­est al­le­ga­tion,” Baird’s Bri­an Sko­r­ney wrote in a note on Oc­to­ber 4.

So­cial im­age: Nan­cy Pelosi, AP Im­ages

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The cell and gene therapies (CGT) sector offers unprecedented opportunities for patient disease management across virtually all therapeutic areas. However, finding the right accredited clinical teams to take a therapy through to the clinic and manage the regulatory process can be a major challenge for biotechs with a CGT product.

Ursula von der Leyen, President of the European Commission

Omi­cron: Re­searchers scram­ble as new coro­n­avirus mu­ta­tion takes flight around the globe — Pfiz­er/BioN­Tech, Mod­er­na vow swift re­sponse

As Americans were waking up for their Black Friday rituals, they were greeted with the news that a new mutation of the Covid-19 virus has appeared and been sequenced — after it caught an international flight to Hong Kong. And two of the leading Covid-19 vaccine developers promised delivery of a new vaccine “within 100 days” if necessary while a third spelled out its 3-prong strategy hours later.

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Thanks­giv­ing edi­tion: Top 15 End­points sto­ries of 2021; Can you name that vac­cine?; Mer­ck­'s Covid an­tivi­ral dis­ap­points; FDA nom­i­nee's in­dus­try ties; 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.

Happy Thanksgiving to all those who are celebrating it — although, if we are being honest, this week’s abbreviated edition is really for those who are not. Wherever you’re tuning in from, we appreciate your support, hope you find this recap helpful and we wish you a wonderful weekend.

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Troy Wilson, Kura CEO

UP­DAT­ED: FDA hits the red light on an ear­ly-stage AML study af­ter a pa­tient dies

The FDA has slapped a clinical hold on the early-stage program for one of Kura Oncology’s cancer drugs following a patient’s death in a clinical trial.

The biotech $KURA reported early Wednesday that the Phase Ib study of KO-539 for acute myeloid leukemia would be halted, suspending enrollment, while researchers and the FDA probed the death. Patients already on the drug can continue taking it.

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Mar­ket­ingRx roundup: Am­gen, Lil­ly, Bio­haven mi­graine brand re­call low, study says; No­var­tis looks to re­make drug launch mod­el

Forget the migraine marketing brand wars. When it comes to patients, many can’t even name one despite substantial advertising efforts, according to a new study from Phreesia that concludes CGRP migraine drugmakers still need to work on brand recognition.

Almost half (47%) of the patients Phreesia surveyed couldn’t name one preventative migraine brand. The best performer was Topamax, a small molecule anticonvulsant that’s been around since 2004, which 26% of migraine patients could recall. Among the new CGRP brand names recognized, Amgen’s Aimovig ranked highest with 8% recall, while Eli Lilly’s Emgality and Biohaven’s Nurtec tied at 7% and Teva’s Ajovy was remembered by 3% of patients.

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What were End­points read­ers tun­ing in­to this year? Here’s a look at our 15 most pop­u­lar re­ports of the year (so far)

At the beginning of this year, I laid out a basic objective for Endpoints News as we headed to our 5th anniversary. We’ve long been doing a fine job covering the breaking news in R&D — if I do say so myself — but we needed to expand our horizons on industry coverage, increase the staff and go much, much deeper when the stories demanded it.

In a phrase: broader and deeper.

It’s safe to say, based on our daily web traffic, that you all seemed to like this idea. We’ve doubled the staff — thanks to a growing group of paid subscribers — ramped up the daily report and now publish a regular slate of in-depth articles. And traffic — those clicks you always read about — have gone up in volume too. Monthly sessions are up 43%, to close to 1.5 million. Unique readers are up 63%, to 874,480 in October, after setting a record of close to a million the month before. Page views are running at 3 million-plus a month. And the overall number of subscribers has surged to 124,000.

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Name that vac­cine: From Comir­naty to Spike­vax to Nu­vax­ovid, Covid-19 shot­s' brand names re­main lit­tle-known

Most people know if they’re “Team Pfizer” or “Team Moderna,” but few know if they got the Comirnaty or Spikevax Covid-19 vaccine. Those are the brand names of Pfizer and Moderna vaccines, respectively, however they have yet to take hold with consumers, media or even medical professionals.

And there are others. Covid vaccine brand names also include AstraZeneca’s Vaxzevria, Novavax’s Nuvaxovid, and Sanofi and GlaxoSmithKline’s Vidprevtyn. J&J’s Janssen-developed Covid vaccine is the lone major holdout and is still yet to be named, if ever. In EMA filings approving its conditional use, the brand name is listed simply as “Covid-19 Vaccine Janssen.”

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Emma Walmsley, GlaxoSmithKline CEO (Fang Zhe/Xinhua/Alamy Live News)

Glax­o­SmithK­line places a risky bet on Ar­row­head­'s RNA drug in the fail­ure-strewn NASH field

As activist investors champ at the bit for change at drug giant GlaxoSmithKline, the pharma giant has turned over many rocks to find an R&D success to present to its detractors. In NASH, a field strewn with failures, GSK hopes a new license deal can churn out a much-needed winner.

GSK will pay $120 million in upfront cash and $910 million in downstream milestones to develop and sell ARO-HSD, Arrowhead Pharmaceuticals’ RNA interference drug targeting fatty liver disease nonalcoholic steatohepatitis (NASH), the companies said Monday.

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Joan Perelló, Sanifit CEO

Joan Perel­ló set out 17 years ago to de­vel­op a drug. And to­day he's be­ing re­ward­ed with a $424M biotech buy­out

Joan Perelló beat all the odds with his little Spanish biotech startup Sanifit.

Working on the far perimeter of the big US/European drug development scene, he took a drug born out of his PhD work and got enough seed cash to get started. That’s one near miracle. In the second near miracle he gathered a previously unheard of venture raise in Spain — helping build an industry ecosystem from scratch — to pursue a successful search for solid human data for his drug, SNF472. And while gathering a virtual team of developers from Europe and the US, the CEO/co-founder steered it into the late-stage arena.

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