‘Too big to care’: Sweep­ing law­suit ac­cus­es Te­va of col­lud­ing with oth­er gener­ic mak­ers to keep prices high

Te­va has been ac­cused of be­ing a ring­leader in a mas­sive price-fix­ing con­spir­a­cy along­side 19 oth­er gener­ic drug­mak­ers in the US, caus­ing price spikes of as much as 1000% from 2013 to 2015, ac­cord­ing to an an­titrust law­suit filed by 44 states.

The law­suit, which al­so names 15 in­di­vid­u­als, is the sec­ond to be filed in an “on­go­ing, ex­pand­ing in­ves­ti­ga­tion” on the gener­ic drug in­dus­try — “the largest pri­vate sec­tor cor­po­rate car­tel in his­to­ry” ac­cord­ing to Con­necti­cut at­tor­ney gen­er­al William Tong. Un­der his pre­de­ces­sor, the state teamed up with a few­er num­ber of states in 2016 to sue some of the same com­pa­nies over two drugs. To­day, the list has grown to 114.

And count­ing. A Con­necti­cut pros­e­cu­tor lead­ing the probe told the Wash­ing­ton Post in De­cem­ber that his team is now look­ing at 300 drugs.

William Tong

While the gener­ic drug mar­ket was de­signed to bring pre­scrip­tion prices down, the ac­cused com­pa­nies — My­lan, Glen­mark, San­doz, Ac­tavis and the like — con­sis­tent­ly co­or­di­nat­ed among them­selves to keep them up for a big­ger prof­it, pros­e­cu­tors al­leged.

Their scheme, in a nut­shell:

Rather than en­ter a par­tic­u­lar gener­ic drug mar­ket by com­pet­ing on price in or­der to gain mar­ket share, com­peti­tors in the gener­ic drug in­dus­try would sys­tem­at­i­cal­ly and rou­tine­ly com­mu­ni­cate with one an­oth­er di­rect­ly, divvy up cus­tomers to cre­ate an ar­ti­fi­cial equi­lib­ri­um in the mar­ket, and then main­tain an­ti­com­pet­i­tive­ly high prices. This ‘fair share’ un­der­stand­ing was not the re­sult of in­de­pen­dent de­ci­sion mak­ing by in­di­vid­ual com­pa­nies to avoid com­pet­ing with one an­oth­er. Rather, it was a di­rect re­sult of spe­cif­ic dis­cus­sion, ne­go­ti­a­tion and col­lu­sion among in­dus­try par­tic­i­pants over the course of many years.

To make mat­ters worse, the law­suit stat­ed in brief sec­tions ti­tled “spo­li­a­tion of ev­i­dence” and “ob­struc­tion of jus­tice,” com­pa­ny ex­ecs be­gan talk­ing to each oth­er and delet­ing texts and emails once they learned about the in­ves­ti­ga­tion.

As gener­ics ac­count for 90% of pre­scrip­tions dis­pensed in the US, this is an is­sue that af­fects every Amer­i­can, Tong said in an in­ter­view with CBS60 Min­utes. For a vi­su­al il­lus­tra­tion, he raised a bot­tle of doxy­cy­cline, an an­tibi­ot­ic he takes dai­ly. The drug is one of many whose prices in­creased over the past years due to the scheme, mak­ing him “one of the vic­tims.”

Bill Whitak­er

The ef­fect of that, he said in re­sponse to a ques­tion from Bill Whitak­er, is “dev­as­tat­ing.”

“It af­fects health in­sur­ance pre­mi­ums and health in­sur­ance plans. It im­pacts Medicare and Med­ic­aid,” he told the host. “And it is a chain re­ac­tion that dri­ves up the price of Amer­i­can health­care to un­nat­ur­al heights.” He went on to say the com­pa­nies were “too big to care.”

Te­va, which saw its shares $TE­VA drop 13% to $12, de­nied the al­le­ga­tions, as did Pfiz­er, ac­cord­ing to state­ments quot­ed by Reuters and the New York Times. Mean­while, No­var­tis vowed to “vig­or­ous­ly con­test” the claims against San­doz.

Vamil Di­van of Cred­it Su­isse sees the com­plaint — re­gard­less of the mer­its of the case — read­ing neg­a­tive­ly for Te­va, as it might lead to some sort of fi­nan­cial set­tle­ment. But it would be “man­age­able” for the com­pa­ny even as it strug­gles with plung­ing rev­enue and de­clin­ing stock, tak­ing in­to con­sid­er­a­tion “the im­por­tant role gener­ic drugs play in man­ag­ing drug spend­ing in this coun­try, as well as Te­va’s cur­rent debt load.”

The As­so­ci­a­tion for Ac­ces­si­ble Med­i­cines, an in­dus­try lob­by­ing group, re­spond­ed to the 60 Min­utes seg­ment by re­it­er­at­ing its gen­er­al con­dem­na­tion of il­le­gal be­hav­iors but em­pha­siz­ing the sav­ings that gener­ics bring com­pared to their brand­ed coun­ter­parts.

“To­day’s gener­ic drug in­dus­try is char­ac­ter­ized by in­tense com­pe­ti­tion,” the state­ment read. “As a re­sult, pric­ing da­ta from the last three years in­di­cate that gener­ic prices have de­clined over­all and saved pa­tients and tax­pay­ers lit­er­al­ly bil­lions of dol­lars com­pared to brand-name drug prices.”

Pfizer, South San Francisco — Jeff Rumans for Endpoints News

Pfiz­er takes aim at a flag­ship fran­chise at Sanofi and Re­gen­eron — and scores a few di­rect hits

Count Pfizer in as a top player in the blockbuster game of JAK1 inhibitors.
Over the weekend the pharma giant posted some stellar Phase III efficacy data for their heavyweight contender abrocitinib in atopic dermatitis (eczema) that lines up ahead of a booming Dupixent (dupilumab), a blockbuster in the portfolios of Regeneron and Sanofi. And they put some real distance ahead of Eli Lilly’s trailing Olumiant, which made a delayed initial arrival on the market for rheumatoid arthritis after the FDA hobbled it with some additional hurdles on safety concerns.
JADE-MONO-1 scores well for Pfizer, teeing up what will be an intensely followed breakdown of the JADE MONO-2 data, which the pharma giant recently top-lined as “similar” to the first Phase III when tested against a placebo — a control group that has been easily outclassed by all the drugs in this market niche.
As of now, Pfizer looks to be equipped to run into the review stage — advantaged by a breakthrough therapy designation that is intended to speed up the regulatory process.
Here’s what physicians and patients are likely to be confronted with in the not too distant future, as Pfizer goes about the tricky business of getting a JAK inhibitor past regulators at the FDA and EMA.
Lined up side by side we see:
IGA response rate (clear or nearly clear skin)

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

Hal Barron and Rick Klausner (GSK, Lyell)

Ex­clu­sive: GSK’s Hal Bar­ron al­lies with Rick Klaus­ner’s $600M cell ther­a­py start­up, look­ing to break new ground blitz­ing sol­id tu­mors

LONDON — Chances are, you’ve heard little or nothing about Rick Klausner’s startup Lyell. But that ends now.

Klausner, the former head of the National Cancer Institute, former executive director for global health at the Gates Foundation, co-founder at Juno and one of the leaders in the booming cell therapy field, has brought together one of the most prominent teams of scientists tackling cell therapy 2.0 — highlighted by a quest to bridge a daunting tech gap that separates some profound advances in blood cancers with solid tumors. And today he’s officially adding Hal Barron and GlaxoSmithKline as a major league collaborator which is pitching in a large portion of the $600 million he’s raised in the past year to make that vision a reality.

“We’ve being staying stealth,” Klausner tells me, then adding with a chuckle: “and going back to stealth after this.”

“Cell therapy has a lot of challenges,” notes Barron, the R&D chief at GSK, ticking off the resistance put up by solid tumors to cell therapies, the vein-to-vein time involved in taking immune cells out of patients, engineering them to attack cancer cells, and getting them back in, and more. “Over the years Rick and I talked about how it would be wonderful to take that on as a mission.”

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

First place fin­ish: Eli Lil­ly just moved to fran­chise leader with their sec­ond mi­graine drug OK in 1 year

In a rare twist for Eli Lilly’s historically slow-moving R&D group, the pharma giant has seized bragging rights to a first-in-class new drug approval. And all signs point to an aggressive marketing followup as they look to outclass some major franchise rivals hobbled by internal dissension.

The FDA came through with an OK for lasmiditan on Friday evening, branding it as Reyvow and lining it up — once a substance classification comes through from the DEA — for a major market release. The oral drug binds to 5-HT1F receptors and is designed to stop an acute migraine after it starts. That makes it a complementary therapy to their CGRP drug Emgality, which has a statistically significant impact on preventing attacks.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

Allogene HQ Open House on September 17, 2019 in South San Francisco. (Jeff Rumans, Endpoints News)

The next 10 years: Where is biotech head­ed?

The last 10 years have seen a revolution in drug development. Timelines have shortened, particularly in oncology. Regulators have opened up. Investment has skyrocketed. China became a player. Biotechs have multiplied as gene and cell therapy has exploded — offering major new advances in the way diseases are treated, and sometimes cured.

So where are we headed from here? I journeyed out to San Francisco in September to discuss the answer to that question at Allogene’s open house. If the last 10 years have been an eye-opener, what does the next decade hold in store?

Patrick Mahaffy, Getty Images

Court green-lights Clo­vis case af­ter de­tail­ing ev­i­dence the board ‘ig­nored red flags’ on false safe­ty and ef­fi­ca­cy da­ta

Clovis investors have cleared a major hurdle in their long-running case against the board of directors, with a Delaware court making a rare finding that they had a strong enough case against the board to proceed with the action.

In a detailed ruling at the beginning of the month that’s been getting careful scrutiny at firms specializing in biotech and corporate governance, the Delaware Court of Chancery found that the attorneys for the investors had made a careful case that the board — a collection of experts that includes high-profile biotech entrepreneurs, a Harvard professor and well-known investigator as well as Clovis CEO Patrick Mahaffy — repeatedly ignored obvious warnings that Mahaffy’s executive crew was touting inflated, unconfirmed data for their big drug Roci. Serious safety issues were also reportedly overlooked while the company continued a fundraising campaign that brought in more than a half-billion dollars. And that leaves the board open to claims related to their role in the fiasco.

The bottom line:

Endpoints Premium

Premium subscription required

Unlock this article along with other benefits by subscribing to one of our paid plans.

Bill Gates backs Gink­go Biowork­s' $350M raise to fu­el the buzzy syn­thet­ic bi­ol­o­gy 'rev­o­lu­tion'

If you want to understand Ginkgo Bioworks, the name should suffice: Bioworks, a spin off “ironworks,” that old industrial linchpin devoted to leveraging scale as a wellspring for vast new industries capable of remaking society. Ginkgo wants to be the ironworks for the revolution it’s heralded with as much fanfare as they can, playing off of one of the buzziest technologies in biotech.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

UCB bags a ri­val to Soliris in $2.1B buy­out deal — but will an in­creas­ing­ly vig­i­lant FTC sign off?

UCB is buying out Ra Pharma $RARX, announcing an acquisition deal that rings up at $48 a share, or $2.1 billion net of cash, and puts them toe-to-toe with Alexion on a clinical showdown.

Ra shares closed at $22.70 on Wednesday.

There’s a small pipeline in play at Ra, but UCB is going for the lead drug — a C5 inhibitor called zilucoplan in Phase III for myasthenia gravis (MG) looking to play rival to Alexion’s Soliris. Soliris has the market advantage, though, with a much earlier approval in MG in late 2017 that UCB feels confident in challenging.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

A new play­er is tak­ing the field in a push for a he­mo­phil­ia A gene ther­a­py, and it’s a big one

BioMarin, the execs at Spark (and buyer-to-be Roche) as well as the Sangamo/Pfizer team have a new rival striding onto the hemophilia block. And it’s a big one.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.

Stuck with a PhI­II gene ther­a­py fail­ure at 96 weeks, Gen­Sight prefers the up­beat as­sess­ment

Two years after treatment, the best thing that GenSight Biologics $SIGHT can say about their gene therapy for vision-destroying cases of Leber Hereditary Optic Neuropathy is that it’s just a bit better than a placebo — just maybe because one treatment can cover both eyes.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 62,000+ biopharma pros reading Endpoints daily — and it's free.