US law­mak­ers now want to hear from the mid­dle­men PBMs to un­pack their role in drug pric­ing

The US Sen­ate Fi­nance Com­mit­tee is up­ping the ante on the is­sue of drug pric­ing with yet an­oth­er hear­ing — this time with phar­ma­cy ben­e­fit man­agers, the mid­dle­men that ne­go­ti­ate re­bates with drug­mak­ers in ex­change for for­mu­la­ry cov­er­age and the pur­port­ed vil­lains be­hind sky­rock­et­ing list prices (ac­cord­ing to big Phar­ma) in a hear­ing last month.

On Tues­day, Sen­a­tors Chuck Grass­ley and Ron Wyden in­vit­ed ex­ec­u­tives from five PBMs — Cigna, CVS, Hu­mana, Unit­ed­Health’s Op­tum­Rx and Prime Ther­a­peu­tics — to tes­ti­fy on April 3 in the third drug pric­ing hear­ing this year.

Chuck Grass­ley

The first hear­ing in Jan­u­ary fo­cused on in­sulin af­ford­abil­i­ty, while the sec­ond in Feb­ru­ary in­volved sev­en phar­ma­ceu­ti­cal ex­ec­u­tives, who square­ly placed the blame for sky­rock­et­ing list prices on the mid­dle­men, as­sert­ing that they are forced to hike the prices of pre­scrip­tion drugs in re­sponse to high­er re­bates that all-pow­er­ful PBMs ne­go­ti­ate.

Last week, large US PBM Ex­press Scripts $ES­RX shot back, sug­gest­ing the pow­er to low­er drug prices ul­ti­mate­ly lies with the man­u­fac­tur­ers. “We of­ten have asked drug com­pa­nies to sim­ply low­er their prices. In­stead, drug com­pa­nies have elect­ed to in­crease prices and in­crease re­bates. This is the op­tion drug mak­ers have cho­sen for them­selves and for the mar­ket­place,” the com­pa­ny said in a state­ment.

“The PBMs de­fense is of­ten fin­ger point­ing, blam­ing ex­or­bi­tant drug pric­ing on the man­u­fac­tur­ers and tak­ing no re­spon­si­bil­i­ty for the prob­lem. In fact, it is the PBMs who bear a great deal of the blame, and their prac­tices have led to se­vere in­fla­tion of the prices of both gener­ic and brand­ed med­ica­tions. This lim­its ac­cess to need­ed med­ica­tions for pa­tients.  It is our hope that the Com­mit­tee does not let them get away with pass­ing the buck,” said Robert Levin, pres­i­dent of the Al­liance for Trans­par­ent and Af­ford­able Pre­scrip­tions (AT­AP), in an emailed state­ment to End­points News.

The gen­er­al job de­scrip­tion for PBMs is to ad­min­is­ter drug ben­e­fits for em­ploy­ers and health plans and run big mail-or­der phar­ma­cies. But what goes on be­hind closed doors be­tween these firms and drug­mak­ers in terms of ne­go­ti­a­tions re­mains some­what of a mys­tery.

Ron Wyden

“Mid­dle­men in the health care in­dus­try owe pa­tients and tax­pay­ers an ex­pla­na­tion of their role. There’s far too much bu­reau­cra­cy and too lit­tle trans­paren­cy get­ting in the way of af­ford­able, qual­i­ty health care,” Grass­ley and Wyden said in a Tues­day state­ment.

All re­bates are passed through in Medicare and 95%+ on the com­mer­cial side with con­tin­ued ef­forts to move re­bate to sub­si­dize out of pock­et (OOP) costs for high­er uti­liz­ing se­niors at the point of sale, Leerink’s Ana Gupte not­ed. “(E)spe­cial­ly UNH which is now mov­ing their ef­forts from ful­ly in­sured em­ploy­ers in 2019 to self- in­sured com­menc­ing 2020. The large PBMs (CVS, CI (ES­RX), UNH) are al­ready im­ple­ment­ing al­ter­na­tive pay­ment mod­els that re­ly less on re­bates.”

Ear­li­er in the day, Unit­ed­Health said it was ex­pand­ing a change to how it han­dles re­bates from drug­mak­ers by re­quir­ing new em­ploy­er clients to pass the dis­counts on to peo­ple who take the med­ica­tions. The move will ap­ply to em­ploy­ers that ink new con­tracts af­ter Jan 1, 2020, the com­pa­ny said.

At the last hear­ing with phar­ma­ceu­ti­cal ex­ec­u­tives, drug­mak­ers ar­gued in fa­vor of cut­ting re­bates not just for Medicare but al­so on the com­mer­cial side to even the play­ing field for all drug man­u­fac­tur­ers, as suf­fi­cient in­cen­tive to low­er list prices.

“Al­though the phar­ma ex­ecs ex­pressed their pref­er­ence for a po­ten­tial re­bate re­struc­tur­ing to oc­cur in both gov­ern­ment and com­mer­cial sec­tors, we be­lieve any large-scale changes in com­mer­cial will be dif­fi­cult with a di­vid­ed Con­gress and the ex­pect­ed push back from large em­ploy­ers who al­ready pass along re­bates to re­duce costs for their em­ploy­ees,” Gupte said.

Aerial view of Genentech's campus in South San Francisco [Credit: Getty]

Genen­tech sub­mits a big plan to ex­pand its South San Fran­cis­co foot­print

The sign is still there, a quaint reminder of whitewashed concrete not 5 miles from Genentech’s sprawling, chrome-and-glass campus: South Francisco The Industrial City. 

The city keeps the old sign, first erected in 1923, as a tourist site and a kind of civic memento to the days it packed meat, milled lumber and burned enough steel to earn the moniker “Smokestack of the Peninsula.” But the real indication of where you are and how much has changed both in San Francisco and in the global economy since a couple researchers and investors rented out an empty warehouse 40 years ago comes in a far smaller blue sign, resembling a Rotary Club post, off the highway: South San Francisco, The Birthplace of Biotech.

Here comes the oral GLP-1 drug for di­a­betes — but No­vo Nordisk is­n't dis­clos­ing Ry­bel­sus price just yet

Novo Nordisk’s priority review voucher on oral semaglutide has paid off. The FDA approval for the GLP-1 drug hit late Friday morning, around six months after the NDA filing.

Rybelsus will be the first GLP-1 pill to enter the type 2 diabetes market — a compelling offering that analysts have pegged as a blockbuster drug with sales estimates ranging from $2 billion to $5 billion.

Ozempic, the once-weekly injectable formulation of semaglutide, brought in around $552 million (DKK 3.75 billion) in the first half of 2019.

As Nas­daq en­rolls the fi­nal batch of 2019 IPOs, how have the num­bers com­pared to past years?

IGM Biosciences’ upsized IPO haul, coming after SpringWorks’ sizable public debut, has revved up some momentum for the last rush of biotech IPOs in 2019.

With 39 new listings on the books and roughly two more months to go before winding down, Nasdaq’s head of healthcare listings Jordan Saxe sees the exchange marking 50 to 60 biopharma IPOs for the year.

“December 15 is usually the last possible day that companies will price,” he said, as companies get ready for business talks at the annual JP Morgan Healthcare Conference in January.

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Oxitec biologist releases genetically modified mosquitoes in Piracicaba, Brazil in 2016 [credit: Getty Images]

In­trex­on unit push­es back against claims its GM mos­qui­toes are mak­ing dis­ease-friend­ly mu­tants

When the hysteria of Zika transmission sprang into the American zeitgeist a few years ago, UK-based Oxitec was already field-testing its male Aedes aegypti mosquito, crafted to possess a gene engineered to obliterate its progeny long before maturation.

But when a group of independent scientists evaluated the impact of the release of these genetically-modified mosquitoes in a trial conducted by Oxitec in Brazil between 2013 and 2015, they found that some of the offspring had managed to survive — prompting them to speculate what impact the survivors could have on disease transmission and/or insecticide resistance.

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[via AP Images]

Pur­due threat­ens to walk away from set­tle­ment, asks to pay em­ploy­ees mil­lions in bonus­es

There are two updates on the lawsuit against Purdue Pharma over its role in fueling the opioid epidemic, as the Sackler family threatens to walk away from their pledge to pay out $3 billion if a bankruptcy judge does not stop outstanding state lawsuits against them. At the same time, the company has asked permission to pay millions in bonuses to select employees.

Purdue filed for chapter 11 bankruptcy this week as part of its signed resolution to over 2,000 lawsuits. The deal would see the Sackler family that owns Purdue give $3 billion from their personal wealth and the company turned into a trust committed to curbing and reversing overdoses.

David Grainger [file photo]

'Dis­con­nect the bas­tard­s' — one biotech's plan to break can­cer cell­s' uni­fied de­fens­es

Chemotherapy and radiotherapy are the current gladiators of cancer treatment, but they come with well-known limitations and side-effects. The emergence of immunotherapy — a ferocious new titan in oncologist’s toolbox — takes the brakes off the immune system to kill cancer cells with remarkable success in some cases, but the approach is not always effective. What makes certain forms of cancer so resilient? Scientists may have finally pieced together a tantalizing piece of the puzzle, and a new biotech is banking on a new approach to fill the gap.

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A fa­vorite in Alex­ion’s C-suite is leav­ing, and some mighty sur­prised an­a­lysts aren’t the least bit hap­py about it

Analysts hate to lose a biotech CFO they’ve come to trust and admire — especially if they’re being blindsided by a surprise exit.

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Scott Gottlieb, AP Images

Scott Got­tlieb is once again join­ing a team that en­joyed good times at the FDA un­der his high-en­er­gy stint at the helm

Right after jumping on Michael Milken’s FasterCures board on Monday, the newly departed FDA commissioner is back today with news about another life sciences board post that gives him a ringside chair to cheer on a lead player in the real-world evidence movement — one with very close ties to the FDA.

Aetion is reporting this morning that Gottlieb is joining their board, a group that includes Mohamad Makhzoumi, a general partner at New Enterprise Associates, where Gottlieb returned after stepping out of his role at the FDA 2 years after he started.

Gottlieb — one of the best connected execs in biopharma — knows this company well. As head of FDA he championed the use of real-world evidence to help guide drug developers and the agency in gaining greater efficiencies, which helped set up Aetion as a high-profile player in the game.

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Tower Bridge in London [Shutterstock]

#UK­BIO19: Join GSK’s Hal Bar­ron and a group of top biotech ex­ecs for our 2nd an­nu­al biotech sum­mit in Lon­don

Over the past 10 years I’ve made a point of getting to know the Golden Triangle and the special role the UK biopharma industry plays there in drug development. The concentration of world class research institutes, some of the most accomplished scientists I’ve ever seen at work and a rising tide of global investment cash leaves an impression that there’s much, much more to come as biotech hubs are birthed and nurtured.