Pharmaguy's Insights Into Drug Industry News
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Pharmaguy's Insights Into Drug Industry News
Pharmaguy curates and provides insights into selected drug industry news and issues.
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Patient Advocates Should Have Fought For Affordable Duchenne Drug as More Insurers Deny Coverage

Patient Advocates Should Have Fought For Affordable Duchenne Drug as More Insurers Deny Coverage | Pharmaguy's Insights Into Drug Industry News | Scoop.it

The story of Exondys 51 raises complex and emotionally charged questions about what happens when the F.D.A. approves an expensive drug based on a lower bar of proof. In practice, health insurers have taken over as gatekeeper in determining who will get the drug.

 

Disputes like the one over the Duchenne drug are likely to become more commonplace in the coming months. A federal law, passed last year, directs the agency to remove barriers to approving drugs and medical devices, and its new commissioner, Dr. Scott Gottlieb, has called on the F.D.A. to be more lenient, especially when it comes to rare pediatric diseases.

 

While insurers once covered drugs for rare diseases as a matter of course, that may be changing now that a wave of expensive drugs have reached the market. The pharmaceutical industry has been in hot pursuit of an increasingly enticing demographic target: An estimated 30 million people in the United States — about 10 percent of the population — are living with one of roughly 7,000 rare diseases.

 

The agency’s approval of Exondys 51, though, prompted a rebellion among some insurers, who are refusing to play along and saying they are concerned about the cumulative impact of such breathtakingly expensive drugs on health care costs. Anthem, one of the nation’s largest insurers, calls Exondys 51 “investigational” because the F.D.A. reserved the right to withdraw it from the market if future clinical trials fail to show it works.

 

Another insurer, Premera Blue Cross, went so far as to tie coverage to an invasive procedure — a muscle biopsy — but then rescinded the requirement.

 

“I’m reading a lot of denial letters,” said Christine McSherry, who until recently served as executive director of the Jett Foundation, an advocacy group that guides families through the insurance appeal process. Her insurer, Blue Cross Blue Shield of Massachusetts, is covering the drug for her son, Jett, through next April. “It’s very disheartening to have worked that hard, and to have sacrificed that much, and to now have to battle the insurance companies.”

 

The drug’s high cost is driving the resistance. While the drug manufacturer, Sarepta, has said Exondys 51 costs about $300,000 a year per child, the price, based on a child’s weight, can be much higher. For the dozen boys in the main clinical trial, the average list price would be more than double Sarepta’s quote — $750,000 each, according to an analysis by the drug benefit firm Prime Therapeutics.

 

“I think a lot of the advocates in this space maybe thought that getting a drug on the market was the goal of their advocacy,” said Dr. Aaron S. Kesselheim, an associate professor of medicine at Harvard University who voted against the drug’s approval as part of an F.D.A. advisory committee. “The goal of the advocacy should have been getting a product on the market, and making sure that it’s available at a reasonable cost.”

 

Further Reading:

  • “2nd Largest Health Insurer – Anthem – Won’t Pay for FDA-Approved Duchenne Drug”; http://sco.lt/6hlYP3
  • “FDA’s Approval of Exondys 51 for DMD Was Primarily Based on Money, Not Efficacy”; http://sco.lt/62xNoH
Pharma Guy's insight:

This article also points out that this may be a trend for expensive drugs that are approved for rare diseases: "While insurers once covered drugs for rare diseases as a matter of course, that may be changing now that a wave of expensive drugs have reached the market. The pharmaceutical industry has been in hot pursuit of an increasingly enticing demographic target: An estimated 30 million people in the United States — about 10 percent of the population — are living with one of roughly 7,000 rare diseases."

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“I Literally Learned from This Guy,” Says Martin Shkreli of Marathon CEO Jeff Aronin Who Set Price of Duchenne Drug at $89,000

“I Literally Learned from This Guy,” Says Martin Shkreli of Marathon CEO Jeff Aronin Who Set Price of Duchenne Drug at $89,000 | Pharmaguy's Insights Into Drug Industry News | Scoop.it

In a controversial move, Marathon Pharmaceuticals is charging $89,000 a year for a decades-old drug that was approved by US regulators on Thursday, but has sold for a fraction of the price in other countries. Known as deflazacort, the steroid will be used to treat Duchenne muscular dystrophy, a rare disease that mostly affects young boys, causing muscles to deteriorate and leading to an early death.

 

The pricing, however, has upset some patient groups, who say that online pharmacies in the UK and Canada sell the medicine for about $1,000 annually, and the approval will preclude imports. They also note the drug received orphan designation, since it treats a rare disease for a small patient population, which means Marathon has seven years of exclusive marketing before rival medicines become available.

 

“It shows they have no appreciation for the cost to the health care system,” said Christine McSherry, who runs The Jett Foundation, a nonprofit group that advocates on behalf of children with DMD. “They’re taking a drug that costs less than $2 and jacking up the price. This affects entire landscape and this is sort of move that causes premiums to rise.” She pays $1,600 a year from a UK pharmacy.

 

This is not the first time that Marathon chief executive Jeff Aronin has generated controversy over his pricing strategies. In years past, the Federal Trade Commission and Senator Bernie Sanders (I-Vt.), a harsh critic of high drug prices, have attacked his moves, although more recently, a company that he once ran was praised by Martin Shkreli for its pricing maneuvers.

 

In 2008, the FTC filed a lawsuit against Ovation Pharmaceuticals, which Aronin ran at the time, accusing the company of price gouging and illegally maintaining a monopoly. Ovation bought the only two medicines that were approved to treat premature babies born with a potentially life-threatening congenital heart defect — and then increased prices nearly 1,300 percent.

 

The FTC eventually lost the lawsuit, but the episode did not go unnoticed by Shkreli. The infamous pharma bro, who gained notoriety after buying an older drug and raising the price by 5,000 percent — and then taunting critics on social media — recently praised Ovation on his web site. “These guys invented price increases,” he wrote. “I, literally, learned it from them.” And he noted Ovation was later sold for $900 million.

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Payers Likely to Pony Up $300,000/yr for Duchenne Drug, But Get No ROI

Payers Likely to Pony Up $300,000/yr for Duchenne Drug, But Get No ROI | Pharmaguy's Insights Into Drug Industry News | Scoop.it

The newly approved Sarepta Therapeutics drug for Duchenne muscular dystrophy will cost about $300,000 a year for the average patient in the United States, which is less than what some Wall Street analysts had expected.

 

Sarepta CEO Dr. Edward Kaye said the pricing was “in the middle of the range” for rare disease drugs. “And given the sensitivity to pricing, we tried to be reasonable when looking at all the costs,” he said on a phone call Monday with securities analysts.

 

Rare disease drugs are defined as treatments for a disease with fewer than 200,000 patients in the US. The average annual cost per patient for such medications rose to $112,000 from $84,000 between 2010 and 2014, according to EvaluatePharma, a research firm.

 

Kaye argued that Sarepta attempted to address pricing concerns while setting the cost for the drug, which will be called Exondys 51. He cited, for instance, the research and development costs the company has so far incurred, as well as future costs for additional trials, some of which are required by regulators.

 

One advocate agreed. “Considering the cost of manufacturing, delivering, and supporting patients [with financial assistance programs], not to mention development costs over a decade, I don’t think it’s too much,” said Debra Miller of CureDuchenne, an advocacy group that also invests in drug makers.

 

The cost is comparable to a cystic fibrosis treatment sold by Vertex Pharmaceuticals, suggesting the price is not out of line, according to Dr. Walid Gellad, the codirector of the Center for Pharmaceutical Policy and Prescribing at the University of Pittsburgh.

 

However, Gellad also noted that Food and Drug Administration reviewers found the Sarepta drug did not demonstrate a clinically meaningful benefit for patients.

 

“Whether it’s $300,000 or $400,000, there are so few patients [with Duchenne] that payers will be able to pay,” he told us. “But what will they pay for?”

 

Meanwhile, Sarepta hopes to offset some costs with a priority review voucher it was awarded by the FDA as part of the approval. The company can use that to speed review of another drug, which can save time and potentially help generate revenue faster, or it can sell the voucher to another company.

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John Carroll, Editor-in-Chief of EndPoints, to Trump: Don’t Bet on a Faster FDA to Lower Drug Prices

John Carroll, Editor-in-Chief of EndPoints, to Trump: Don’t Bet on a Faster FDA to Lower Drug Prices | Pharmaguy's Insights Into Drug Industry News | Scoop.it

[John Carroll, comes down hard on failed Duchenne drug & Donald Trump’s criticism of FDA in a recent “Thumbs Up/Down” opinion piece.

 

Regarding a failed Duchenne drug, Carroll says:]

 

I never understood why the EMA would suddenly reverse itself in 2014 and allow PTC to sell ataluren as its only approved therapy on the continent for Duchenne muscular dystrophy. And it was even more perplexing to see the European regulator come back last year and decide to allow the drug to remain on the market as PTC lined up a new late-stage study over an expansive 5-year grace period.

 

At that point, not only did the EMA know full well that the drug had simply failed a Phase III trial for Duchenne, supposedly designed so that it would overcome the flaws in its failed Phase IIb trial, but the FDA had locked the door to PTC’s executive crew, unwilling to spend any time reviewing a drug that was woefully unacceptable for marketing.

 

This week, PTC put what should have been the last nail in ataluren’s coffin with fresh evidence that this drug is a dud. It failed the Phase III for cystic fibrosis. Case closed.

 

Except that it’s not and won’t be. This drug will continue to be sold despite the fact that it has repeatedly and decisively failed to clear late-stage trial hurdles. Even NICE was willing to endorse it for the UK after working out a price with PTC. PTC expects to earn more than $100 million this year from sales. And it has the backing of patient advocates — Duchenne families — who swear by it.

 

As we found out from Sarepta’s Exondys 51, though, regulators can be persuaded to overlook gaping holes in a Duchenne drug’s development program to make way for an approval (read “Path Taken by Sarepta NOT a Good Model for Other Rare Drug Approvals, Says FDA Official Who Should Know”; http://sco.lt/7stCs5).

 

There has to be a better way. If the FDA and EMA want to handle new drugs for Duchenne MD according to a different standard, then they should set up special groups inside the agencies that can help biotechs direct small but better designed studies that can offer real-world evidence of efficacy and safety. The path we’re on now is a disaster for patients, families and the societies forced to pay for these wildly expensive, unproven drugs.

 

[Regarding president Trump’s criticism of FDA’s approval process, Carroll says:]

 

The drug approval process, he says, is slow and burdensome (read , and he plans to make some big changes (here; http://sco.lt/8bbHJB). If you deregulate drug development, he has said before, drugs can speed through the FDA faster and the price will drop.

 

That, of course, is simply ridiculous. We’ve seen quite a few drugs speed through the review process in the last few years, and the price was in no way discounted as a result.

 

When Biogen, which has its own efficiency issues to address, got an approval for Spinraza last December just three months after it was filed, do you think the big biotech offered a discount as a result?

 

Not a chance. It priced the rare disease drug at $750,000. With its Tecfidera franchise on the wane, Biogen needs new revenue to satisfy investors. And how is that in any way unusual?

 

Gilead was a model of efficiency and expertise when it whipped through a development program for new hep C drugs. Sovaldi was the third drug approved under the FDA’s breakthrough drug designation, designed to help speed development timelines. It originally cost a small fortune. Cancer drug development has been revolutionized by the BTD program over the past few years. Have prices come down?

 

There are things that the FDA can do better that will lower some drug costs. But unless the president plans to simply gut development rules — a real possibility — don’t look for a faster FDA to bring down drug prices. Lower costs on drug programs do not lower prices.

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2nd Largest Health Insurer – Anthem – Won’t Pay for FDA-Approved Duchenne Drug

2nd Largest Health Insurer – Anthem – Won’t Pay for FDA-Approved Duchenne Drug | Pharmaguy's Insights Into Drug Industry News | Scoop.it

Health insurer Anthem Inc said it would not cover the first U.S. Food and Drug Administration-approved Duchenne muscular dystrophy (DMD) drug, developed by Sarepta Therapeutics Inc, calling it "investigational and not medically necessary".

 

Bowing to pressure from patient advocates, the FDA approved the drug, Exondys 51, last month, even though an outside panel of experts and the agency's own reviewers questioned its efficacy (read “FDA Succumbs to Industry-Sponsored ‘Patient Power’ & Accelerates Approval of Sarepta's Duchenne Drug”; http://sco.lt/4mgzvV)

 

The accelerated approval is based on data believed to predict a clinical benefit. Sarepta has to prove that benefit in a subsequent clinical trial.

 

Anthem, the second-largest health insurer in the United States, said on its website on Friday the drug's clinical benefit, including improved motor function, had not been demonstrated. (bit.ly/2e9qGhu) 

 

"Exondys 51 failed to show it improves health outcomes, and therefore it is not a covered benefit for our members," Anthem spokeswoman Leslie Porras said in an emailed statement on Friday.

Pharma Guy's insight:

“Considering the cost of manufacturing, delivering, and supporting patients [with financial assistance programs], not to mention development costs over a decade, I don’t think it’s too much,” said Debra Miller of CureDuchenne, an advocacy group that also invests in drug makers (read “Payers Likely to Pony Up $300,000/yr for Duchenne Drug, But Get No ROI”; http://sco.lt/6H6TlR).

 

The Sarepta drug may be more popular with doctors than insurers reports Pharmalot: "a new survey suggests the treatment may soon be more widely prescribed,...About half of 100 neurologists reported they would prescribe the drug to at least 80 percent of their eligible patients and only 10 percent of the physicians indicated they would narrowly restrict its use, according to RBC Capital Markets analyst Simos Simeonidis, who commissioned the poll."

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