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Morning Briefing

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Wednesday, May 15 2019

Full Issue

Pharma's Go-To Defense Of High 'Research And Development' Costs Undercut By New Study

News outlets report on stories related to pharmaceutical pricing.

A coalition of the drug industry鈥檚 fiercest foes is accusing the world鈥檚 top drug makers of hiding behind research and development 鈥渁s an excuse for price-gouging American patients.鈥 And they鈥檙e pointing to a new study that finds drug makers spent about 22% of their revenues on research and development in 2017 to prove their point. The new study, first shared with STAT, was commissioned by the Campaign for Sustainable Rx Pricing, a coalition that includes pharmacy middlemen, hospitals, and insurers and that advocates for drug pricing reforms. It was based largely on analysis of 2017 Security and Exchange Commission filings for the 10 largest U.S.-based pharmaceutical companies that generate more than half their revenue from prescription drugs. (Florko, 5/14)

Donald Trump鈥檚 promise of sweeping health-care reform has not come to pass. While the president campaigned heavily on assurances to 鈥渞epeal and replace Obamacare鈥 on 鈥渄ay one鈥 with an unspecified plan for every American to have affordable health care, his claims have now been diluted to a focus on 鈥渄rug prices.鈥 One of his first comments on the release of the Mueller report was that it was a distraction from the need to 鈥済et back to infrastructure, get back to cutting taxes, get back to lowering prescription drug prices.鈥 (Hamblin, 5/10)

President Donald Trump is misstating the facts when it comes to prescription drug prices. Speaking Monday at a White House dinner, he cited a remarkable drop in prescription drug prices. But a government index that had registered some declines is now showing an increase again. Some experts say more increases are likely. (Alonso-Zaldivar and Yen, 5/14)

Insurers are struggling over how to handle major drug policy changes the Trump administration has proposed as the filing deadline for 2020 Medicare Advantage bids approaches. The financial stakes are huge: Medicare spends more than $100 billion per year on prescription drugs. (Demko, 5/10)

U.S. traded shares of Teva Pharmaceutical plunged more than 16% on Monday after 44 states sued the company, alleging it orchestrated a sweeping scheme with 19 other drugmakers to inflate prices. Shares of drugmakers Mylan, which was also named in the lawsuit, were trading 10% lower in afternoon trading. The states, led Connecticut Attorney General William Tong, claim 20 drug companies, including Teva USA, 鈥渟ystematically鈥 divided up the market for generic drugs to avoid competing with one another, according to a 500-page lawsuit filed late Friday in the U.S. District Court in Connecticut. (Lovelace, 5/13)

Now, a new treatment called Zolgensma (pronounced zohl-JEN-smah), which replaces the gene that's defective in spinal muscular atrophy, is expected to break that price record this month. The FDA is expected to approve Zolgensma sometime in May, and the biopharma company Novartis is then expected to announce the price.Novartis executives have made clear it will be in the seven figures. (Goldberg, 5/10)

The biggest health care bill of the year is coming to the House floor this week. House Democrats have packaged together a bunch of proposals to lower prescription drug costs and to reverse the Trump administration鈥檚 maneuvers to undermine the Affordable Care Act, and they are bringing them to the floor for a vote this week as one bill. (Scott, 5/13)

This was supposed to be a good week for the makers of low-cost generic drugs,聽as a bill that is one of their top priorities gets a House floor vote. Instead, the industry finds itself clouded by allegations of price fixing and its signature bill is being packaged with two measures they oppose. The bill (HR 987) that the House will take up Thursday combines three drug pricing measures with bills to strengthen the individual health insurance market. (Siddons, 5/15)

A group of Minnesota diabetics made an eleventh-hour plea on Monday for lawmakers to address the rising costs of insulin. During a news conference at the state Capitol, the women urged lawmakers to unite behind a proposal that would give diabetics an emergency supply of insulin if they cannot afford it. The 鈥淎lec Smith Emergency Insulin Act鈥 provision is wrapped into the House and Senate health and human services bills, but the versions are slightly different. Those who have high-deductible insurance plans could get an emergency refill under the House bill, but not the Senate version. And the House bill would provide an emergency supply of 90 days, as opposed to the Senate proposal of 30 days. (Faircloth, 5/13)

Six Minnesota diabetes activists, who have dubbed themselves the 鈥淐aravan to Canada,鈥 approached the U.S. border crossing last Sunday with a mixture of apprehension and defiance. Their three vehicles were carrying insulin, carefully packed in coolers, that they had bought the day before at a Canadian pharmacy just three blocks away. Together, they had spent $1,265 for insulin supplies that in the United States would cost an estimated $12,400 鈥 a savings of $11,000. (Howatt, 5/12)

Underscoring concerns about ongoing drug shortages, two different ventures representing hundreds of hospitals across the U.S. are announcing separate deals on Wednesday in which manufacturers have agreed to provide medicines that are in short supply. In the first deal, CivicaRx, which is a generic drug company formed by several large hospital systems and three philanthropies, has reached an agreement for Xellia Pharmaceuticals to manufacture antibiotics, including vancomycin and daptomycin. (Silverman, 5/15)

Oregon lawmakers are looking at ways to address the spiking costs of prescription drugs. Two bills in the Legislature could bring down prices, which would be a relief to older Oregonians. According to a U.S. Senate report from last year, the prices for some commonly prescribed, name-brand drugs are increasing at 10 times the rate of inflation. Geneva Craig, a registered nurse at Asante Health Systems in Medford and an AARP Oregon executive council member, said she wants the state to act soon because of the effects she's seen from unaffordable drugs. (5/15)

Maryland Gov. Larry Hogan is facing pressure to sign bills that would create a state board to monitor drug prices and to increase the state鈥檚 requirements for using renewable energy. ... Health advocacy groups have been pressing Hogan to approve a bill that would create a state Prescription Drug Affordability Board. They were buoyed by comments Hogan made at a political event in New Hampshire last month when he was asked about high drug prices. (Wood, 5/14)

According to the Institute for Clinical and Economic Review (ICER), Spravato may be overpriced for the benefits it delivers. Each treatment costs $590 to $885.And that price doesn鈥檛 cover the doctor鈥檚 time. (Wood, 5/13)

Anyone holding out hope that a lower-cost version of the Humira rheumatoid arthritis treatment might soon become available in the U.S. can forget about it. That鈥檚 because AbbVie (ABBV) has settled patent litigation with Boehringer Ingelheim, which will be allowed to sell a biosimilar version of the medicine as part of the deal 鈥 but not until July 2023. Boehringer had been the sole holdout among several large drug makers that previously reached such agreements, which also preclude them from marketing versions of Humira for another four years. (Silverman, 5/14)

This is part of the Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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