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

BiTE® Plat­form and the Evo­lu­tion To­ward Off-The-Shelf Im­muno-On­col­o­gy Ap­proach­es

Despite rapid advances in the field of immuno-oncology that have transformed the cancer treatment landscape, many cancer patients are still left behind.1,2 Not every person has access to innovative therapies designed specifically to treat his or her disease. Many currently available immuno-oncology-based approaches and chemotherapies have brought long-term benefits to some patients — but many patients still need other therapeutic options.3

RA Cap­i­tal, Hill­house join $310M rush to back Ever­est's climb to com­mer­cial heights in Chi­na

Money has never been an issue for Everest Medicines. With an essentially open tab from their founders at C-Bridge Capital, the biotech has gone two and a half years racking up drug after drug, bringing in top exec after top exec, and issuing clinical update after update.

But now other investors want in — and they’re betting big.

Everest is closing its Series C at $310 million. The first $50 million comes from the Jiashan National Economic and Technological Development Zone; the remaining C-2 tranche was led by Janchor Partners, with RA Capital Management and Hillhouse Capital as co-leaders. Decheng Capital, GT Fund, Janus Henderson Investors, Rock Springs Capital, Octagon Investments all joined.

Drug man­u­fac­tur­ing gi­ant Lon­za taps Roche/phar­ma ‘rein­ven­tion’ vet as its new CEO

Lonza chairman Albert Baehny took his time headhunting a new CEO for the company, making it absolutely clear he wanted a Big Pharma or biotech CEO with a good long track record in the business for the top spot. In the end, he went with the gold standard, turning to Roche’s ranks to recruit Pierre-Alain Ruffieux for the job.

Ruffieux, a member of the pharma leadership team at Roche, spent close to 5 years at the company. But like a small army of manufacturing execs, he gained much of his experience at the other Big Pharma in Basel, remaining at Novartis for 12 years before expanding his horizons.

President Donald Trump (left) and Moncef Slaoui, head of Operation Warp Speed (Alex Brandon, AP Images)

UP­DAT­ED: White House names fi­nal­ists for Op­er­a­tion Warp Speed — with 5 ex­pect­ed names and one no­table omis­sion

A month after word first broke of the Trump Administration’s plan to rapidly accelerate the development and production of a Covid-19 vaccine, the White House has selected the five vaccine candidates they consider most likely to succeed, The New York Times reported.

Most of the names in the plan, known as Operation Warp Speed, will come as little surprise to those who have watched the last four months of vaccine developments: Moderna, which was the first vaccine to reach humans and is now the furthest along of any US effort; J&J, which has not gone into trials but received around $500 million in funding from BARDA earlier this year; the joint AstraZeneca-Oxford venture which was granted $1.2 billion from BARDA two weeks ago; Pfizer, which has been working with the mRNA biotech BioNTech; and Merck, which just entered the race and expects to put their two vaccine candidates into humans later this year.

Is a pow­er­house Mer­ck team prepar­ing to leap past Roche — and leave Gilead and Bris­tol My­ers be­hind — in the race to TIG­IT dom­i­na­tion?

Roche caused quite a stir at ASCO with its first look at some positive — but not so impressive — data for their combination of Tecentriq with their anti-TIGIT drug tiragolumab. But some analysts believe that Merck is positioned to make a bid — soon — for the lead in the race to a second-wave combo immuno-oncology approach with its own ambitious early-stage program tied to a dominant Keytruda.

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David Meline (file photo)

Mod­er­na’s new CFO took a cut in salary to jump to the mR­NA rev­o­lu­tion­ary. But then there’s the rest of the com­pen­sa­tion pack­age

David Meline took a little off the top of his salary when he jumped from the CFO post at giant Amgen to become the numbers czar at the upstart vaccines revolutionary Moderna. But the SEC filing that goes with a major hire also illustrates how it puts him in line for a fortune — provided the biotech player makes good as a promising game changer.

To be sure, there’s nothing wrong with the base salary: $600,000. Or the up-to 50% annual cash bonus — an industry standard — that comes with it. True, the 62-year-old earned $999,000 at Amgen in 2019, but it’s the stock options that really count in the current market bliss for all things biopharma. And there Meline did well.

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Covid-19 roundup: Ab­b­Vie jumps in­to Covid-19 an­ti­body hunt; As­traZeneca shoots for 2B dos­es of Ox­ford vac­cine — with $750M from CEPI, Gavi

Another Big Pharma is entering the Covid-19 antibody hunt.

AbbVie has announced a collaboration with the Netherlands’ Utrecht University and Erasmus Medical Center and the Chinese-Dutch biotech Harbour Biomed to develop a neutralizing antibody that can treat Covid-19. The antibody, called 47D11, was discovered by AbbVie’s three partners, and AbbVie will support early preclinical work, while preparing for later preclinical and clinical development. Researchers described the antibody in Nature Communications last month.

GSK presents case to ex­pand use of its lu­pus drug in pa­tients with kid­ney dis­ease, but the field is evolv­ing. How long will the mo­nop­oly last?

In 2011, GlaxoSmithKline’s Benlysta became the first biologic to win approval for lupus patients. Nine years on, the British drugmaker has unveiled detailed positive results from a study testing the drug in lupus patients with associated kidney disease — a post-marketing requirement from the initial FDA approval.

Lupus is a drug developer’s nightmare. In the last six decades, there has been just one FDA approval (Benlysta), with the field resembling a graveyard in recent years with a string of failures including UCB and Biogen’s late-stage flop, as well as defeats in Xencor and Sanofi’s programs. One of the main reasons the success has eluded researchers is because lupus, akin to cancer, is not just one disease — it really is a disease of many diseases, noted Al Roy, executive director of Lupus Clinical Investigators Network, an initiative of New York-based Lupus Research Alliance that claims it is the world’s leading private funder of lupus research, in an interview.

UP­DAT­ED: Es­ti­mat­ing a US price tag of $5K per course, remde­sivir is set to make bil­lions for Gilead, says key an­a­lyst

Data on remdesivir — the first drug shown to benefit Covid-19 patients in a randomized, controlled trial setting — may be murky, but its maker Gilead could reap billions from the sales of the failed Ebola therapy, according to an estimate by a prominent Wall Street analyst. However, the forecast, which is based on a $5,000-per-course US price tag, triggered the ire of one top drug price expert.