Trump's 'sweep­ing ac­tion' to low­er drug prices mocked by an­a­lysts as re­lieved in­vestors trig­ger ral­ly in Big Phar­ma stocks

Pres­i­dent Don­ald Trump took to the bul­ly pul­pit to­day to steer a pack­age of pro­pos­als in­to ex­is­tence that he claimed is “the most sweep­ing ac­tion in his­to­ry to low­er the price of pre­scrip­tion drugs for the Amer­i­can peo­ple.”

But if that was his aim, his shot hit so far from the mark that it trig­gered a spike in Big Phar­ma stock prices as an­a­lysts dis­missed the ef­fort as a “non-event” cen­tered on some mar­gin­al pro­mo­tion­al is­sues that would be a “small price to pay” for avoid­ing tak­ing a hit on their con­trol of drug pric­ing.

Trump’s short speech — play­ing out against a back­drop of rev­e­la­tions that No­var­tis had paid his per­son­al at­tor­ney $1.2 mil­lion — con­tin­ued his prac­tice of ex­co­ri­at­ing drug lob­by­ists and spe­cial in­ter­ests. But it was long on rhetoric and short on tough moves. 

The pres­i­dent said his pro­pos­als would re­sult in “elim­i­nat­ing the mid­dle men; the mid­dle men be­came very, very rich,” even though their stocks al­so surged in the wake of Trump’s roll­out. And he vowed to take on spe­cial in­ter­ests while pre­vent­ing man­u­fac­tur­ers from ex­ploit­ing the coun­try’s patent sys­tem to guard block­buster ther­a­peu­tic fran­chis­es.

As promised, Trump ac­cused oth­er coun­tries of en­gi­neer­ing ar­ti­fi­cial­ly low drug prices, forc­ing Amer­i­cans to shoul­der the weight of “the enor­mous cost of re­search and de­vel­op­ment.” Trump al­so weighed in against so-called gag laws that pre­vent phar­ma­cists from point­ing con­sumers to low­er priced al­ter­na­tives to pre­scribed drugs.

In a quick fol­low-up, HHS Sec­re­tary Alex Azar raised one spe­cif­ic pro­pos­al that aimed at sham­ing phar­ma com­pa­nies by forc­ing them to in­clude the price of the drugs they pro­mot­ed in ad­ver­tis­ing.

While lob­by­ists may have come in for a tongue lash­ing, the in­dus­try has to be pleased that the ad­min­is­tra­tion is mak­ing no move to re­quire Medicare to ne­go­ti­ate low­er prices, or al­low for reim­por­ta­tion of drugs from those oth­er coun­tries with cheap­er prices. What we heard about to­day amount­ed to some tai­lor­ing and planned slim­ming — the ba­sic out­fit re­mains the same. And that fact helped trig­ger a broad ral­ly in Big Phar­ma stocks af­ter the speech wrapped.

HHS pro­vid­ed more specifics in a blue­print for ac­tion that it dis­trib­uted just be­fore the speech­es. The ac­tions in­clude —

  • Adding val­ue-based drug con­tract­ing, which the in­dus­try has al­ready ea­ger­ly signed off on as a need­ed com­pro­mise.
  • Chang­ing the for­mu­la­ry struc­ture used by Medicare Part D plans to al­low for a min­i­mum of one drug per cat­e­go­ry or class, rather than 2, to height­en com­pe­ti­tion and al­low some lever­ag­ing.
  • En­cour­ag­ing states to try new de­mo projects us­ing best prac­tices from pri­vate in­dus­try to low­er drug costs.
  • End­ing the 180-day gener­ic drug ex­clu­siv­i­ty pro­vi­sion as a tem­po­rary mea­sure to hold back dis­count com­pe­ti­tion.
  • Go­ing af­ter low for­eign drug prices be­gin­ning with an analy­sis of prices in coun­tries be­long­ing to the Or­gan­i­sa­tion for Eco­nom­ic Co-op­er­a­tion and De­vel­op­ment.
  • In­clud­ing new rules aimed at low­er­ing out-of-pock­et ex­pens­es.
  • Of­fer­ing thoughts on in­creas­ing the num­ber and ac­cess to biosim­i­lars, elim­i­nat­ing a process where “man­u­fac­tur­ers may seek to use shared sys­tem REMS to de­lay or block com­pe­ti­tion from gener­ic prod­ucts en­ter­ing the mar­ket.”
  • Giv­ing Part D plans more flex­i­bil­i­ty on adding cheap­er gener­ics to their for­mu­la­ries.
  • And in ad­di­tion to see­ing if the rules can be changed to re­quire phar­mas to pub­li­cize pric­ing, the gov­ern­ment has a plan to spot­light drugs which have not seen reg­u­lar price hikes as part of an at­tempt to shine a light on the cost of in­di­vid­ual ther­a­pies.

The pro­pos­als to­day are very much a work in progress, with the ad­min­is­tra­tion promis­ing to look at in­ter­change­abil­i­ty of biosim­i­lars with brand­ed drugs, an is­sue that has raised the hack­les of some drug man­u­fac­tur­ers whose fran­chise drugs face a com­pet­i­tive threat.

But while com­pa­nies are like­ly to ob­ject to var­i­ous de­tails in the plan, with con­sid­er­able lob­by­ing to come on the specifics, there are no big changes out­lined here that will do what Trump has been promis­ing to do for more than a year: slash drug prices.

In­vestors clear­ly didn’t see any pain in the pro­pos­als. The $NBI surged, along with shares of the big phar­mas like Eli Lil­ly (up 2%), Mer­ck (up 3%) and J&J (up 2%). So did the PBMs — $ES­RX — that took a hit from the pres­i­dent. The win­dow dress­ing to this speech may have in­di­cat­ed a time of mourn­ing, but the lights were on and the par­ty was un­der­way in­side.

Jef­feries called it “be­nign,” and a “non-event.”

Leerink didn’t see much earth shak­ing about it.

Over­all we con­cur with the ob­vi­ous Street sen­ti­ment that the pro­pos­als are much less dra­con­ian than feared, and with no re-im­por­ta­tion, no manda­to­ry trans­paren­cy of con­tracts, no guar­an­teed flow-through of re­bates, no patent term ab­bre­vi­a­tion or risks, then the lim­it­ed im­pact of greater price trans­paren­cy, which the in­dus­try will op­pose, seems a small price to pay if in­deed those pro­pos­als are im­ple­ment­ed.

Trump, mean­while, is stick­ing with his vow to bring drug prices in­to line the world over.

This is “just the be­gin­ning,” Trump con­clud­ed, promis­ing new leg­is­la­tion and more ac­tions that re­quired help from Con­gress.

“We’re go­ing to see those prices come down,” he said. “It will be a beau­ti­ful thing.”


Im­ages: Pres­i­dent Don­ald Trump and Health and Hu­man Ser­vices Sec­re­tary Alex Azar. WHITE HOUSE via YOUTUBE

GSK's Hal Bar­ron her­alds their sec­ond pos­i­tive PhI­II for cru­cial an­ti-BC­MA ther­a­py, point­ing to a push for quick OKs in a crowd­ed field

Hal Barron has his second positive round of Phase III data in hand for his anti-BCMA antibody drug conjugate belantamab mafodotin (GSK2857916). And GSK’s research chief says the data paves the way for their drive in search of an FDA approval for treating multiple myeloma. 

It’s hard to overestimate the importance of this drug for GSK, a cornerstone of Barron’s campaign to make a dramatic impact on the oncology market and provide some long-lost excitement for the pharma giant’s pipeline. They’re putting this BCMA program at the front of that charge — looking to lead a host of rivals all aimed at the same target.

Martin Shkreli [via Getty]

Pris­on­er #87850-053 does not get to add drug de­vel­op­er to his list of cred­its

Just days after Retrophin shed its last ties to founder Martin Shkreli, the biotech is reporting that the lead drug he co-invented flopped in a pivotal trial. Fosmetpantotenate flunked both the primary and key secondary endpoints in a placebo-controlled trial for a rare disease called pantothenate kinase-associated neurodegeneration, or PKAN.

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UP­DAT­ED: An em­bold­ened As­traZeneca splurges $95M on a pri­or­i­ty re­view vouch­er. Where do they need the FDA to hus­tle up?

AstraZeneca is in a hurry.

We learned this morning that the pharma giant — not known as a big spender, until recently — forked over $95 million to get its hands on a priority review voucher from Sobi, otherwise known as Swedish Orphan Biovitrum.

That marks another step down on price for a PRV, which allows the holder to slash 4 months off of any FDA review time.

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We­bi­nar: Re­al World End­points — the brave new world com­ing in build­ing fran­chise ther­a­pies

Several biopharma companies have been working on expanding drug labels through the use of real world endpoints, combing through the data to find evidence of a drug’s efficacy for particular indications. But we’ve just begun. Real World Evidence is becoming an important part of every clinical development plan, in the soup-through-nuts approach used in building franchises.

I’ve recruited a panel of 3 top experts in the field — the first in a series of premium webinars — to look at the practical realities governing what can be done today, and where this is headed over the next few years, at the prodding of the FDA.

ZHEN SU — Merck Serono’s Senior Vice President and Global Head of Oncology
ELLIOTT LEVY — Amgen’s Senior Vice President of Global Development
CHRIS BOSHOFF — Pfizer Oncology’s Chief Development Officer

A premium subscription to Endpoints News is required to attend this webinar. Please upgrade to either an Insider or Enterprise plan for access. Already have Endpoints Premium? Please sign-in below. You can contact our Subscriptions team at help@endpointsnews.com with any issues.

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Brian Kaspar. AveXis via Twitter

AveX­is sci­en­tif­ic founder fires back at No­var­tis CEO Vas Narasimhan, 'cat­e­gor­i­cal­ly de­nies any wrong­do­ing'

Brian Kaspar’s head was among the first to roll at Novartis after company execs became aware of the fact that manipulated data had been included in its application for Zolgensma, now the world’s most expensive therapy.

But in his first public response, the scientific founder at AveXis — acquired by Novartis for $8.7 billion — is firing back. And he says that not only was he not involved in any wrongdoing, he’s ready to defend his name as needed.

I reached out to Brian Kaspar after Novartis put out word that he and his brother Allen had been axed in mid-May, two months after the company became aware of the allegations related to manipulated data. His response came back through his attorneys.

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Bob Smith, Pfizer

Pfiz­er is mak­ing a $500M state­ment to­day: Here’s how you be­come a lead play­er in the boom­ing gene ther­a­py sec­tor

Three years ago, Pfizer anted up $150 million in cash to buy Bamboo Therapeutics in Chapel Hill, NC as it cautiously stuck a toe in the small gene therapy pool of research and development.

Company execs followed up a year later with a $100 million expansion of the manufacturing operations they picked up in that deal for the UNC spinout, which came with $495 million in milestones.

And now they’re really going for it.

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Video: Putting the AI in R&D — with Badhri Srini­vasan, Tony Wood, Rosana Kapeller, Hugo Ceule­mans, Saurabh Sa­ha and Shoibal Dat­ta

During BIO this year, I had a chance to moderate a panel among some of the top tech experts in biopharma on their real-world use of artificial intelligence in R&D. There’s been a lot said about the potential of AI, but I wanted to explore more about what some of the larger players are actually doing with this technology today, and how they see it advancing in the future. It was a fascinating exchange, which you can see here. The transcript has been edited for brevity and clarity. — John Carroll

UP­DAT­ED: As­traZeneca’s Imfinzi/treme com­bo strikes out — again — in lung can­cer. Is it time for last rites?

AstraZeneca bet big on the future of their PD-L1 Imfinzi combined with the experimental CTLA-4 drug tremelimumab. But once again it’s gone down to defeat in a major Phase III study — while adding damage to the theory involving targeting cancer with a high tumor mutational burden.

Early Wednesday the pharma giant announced that their NEPTUNE study had failed, with the combination unable to beat standard chemo at overall survival in high TMB cases of advanced non-small cell lung cancer. We won’t get hard data until later in the year, but the drumbeat of failures will call into question what — if any — future this combination can have left.

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Am­gen, Al­ler­gan biosim­i­lar of Roche's block­buster Rit­ux­an clears an­oth­er US piv­otal study 

Novartis $NVS may have given up, but Amgen $AMGN and Allergan $AGN are plowing ahead with their knockoff of Roche’s blockbuster biologic Rituxan in the United States.

Their copycat, ABP 798, was found to have a clinically equivalent impact as Rituxan — meeting the main goal of the study involving CD20-positive B-cell non-Hodgkin’s lymphoma patients. This is the second trial supporting the profile of the biosimilar. In January, it came through with positive PK results in patients with rheumatoid arthritis.