This New Treatment Could Save the Lives of Babies. But It Costs $2.1 Million

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Source: New York Times

The Food and Drug Administration on Friday approved a gene therapy for spinal muscular atrophy, a rare muscle-wasting disease that, in its most severe form, kills many babies before they turn 2.

The price will be $2.1 million, believed to be highest ever set for a one-time treatment.

The therapy, to be sold as Zolgensma, alters the underlying genetic cause of spinal muscular atrophy and may permanently stop the disease. It is among the first of a host of gene therapies that promise a cure for deadly inherited conditions.

“We feel we’re on a path where we hope one day to be able to bring S.M.A. almost to elimination,” said Vas Narasimhan, the Novartis chief executive, in a conference call with reporters.

Many drugs for rare diseases have arrived on the market recently costing hundreds of thousands of dollars a year. But few have crossed the $1 million threshold.

Luxturna, a gene therapy that treats a rare, inherited form of blindness, costs $850,000, and Kymriah, Novartis’s one-time cell therapy treatment for leukemia, costs $475,000. The annual cost of some other rare-disease drugs can top $1 million, depending on a patient’s weight.

In addition to the staggering price, Novartis also unveiled a plan Friday that would allow insurers to pay for the treatment over five years, which would average out to $425,000 per year, which the company notes is comparable to the prices for other treatments of ultrarare disorders.

Novartis had declined until now to reveal Zolgensma’s price, but its executives have been on a monthslong publicity tour, making the casefor a multimillion-dollar price tag.

At an event this week in Boston, for example, Mr. Narasimhan told reporters that Novartis planned to set a price that is “far lower” than the $4 million to $5 million the company had determined that the treatment is worth, according to Reuters.

Critics say the statements were part of a sophisticated effort to acclimate the public to an astronomical price.

“The industry is masterful at creating certain facts, which become immutable even though they’re not,” said Dr. Peter B. Bach, director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering Cancer Center in New York.

“They have been whispering the price of multiple millions of dollars now for years, so that the marketplace at some level now believes that this is how much these things will cost.”

In an interview before the approval, David Lennon, the president of AveXis, the Novartis unit developing Zolgensma, said the company set the price based on a 50 percent discount off what Novartis believed it is worth, measured in part by the long-term cost of other rare-disease drugs.

Spinraza, a drug approved in 2016 that also treats spinal muscular atrophy, costs $750,000 in the first year of treatment and then about $375,000 a year after that. The cost of a decade of treatment with Spinraza, therefore, is more than $4 million.

“We believe this is a balanced approach,” Mr. Lennon said in the interview. “We do have high hopes that this is an extremely durable product and really does have the potential to provide a lifetime of benefit.”

Spinal muscular atrophy affects the motor nerve cells in the spinal cord, causing the body to lose physical strength and eventually robbing people of their ability to walk, talk, swallow and breathe.

About 1 in 11,000 babies are born with spinal muscular atrophy. Before Spinraza’s approval, there was no treatment, and children with Type 1 often died before they turned 2.

The F.D.A. approved the treatment for children under 2 with all forms of spinal muscular atrophy. Novartis said there are about 400 new patients a year, or about 30 a month. In addition, 700 patients who already have the disease are eligible for the treatment.

Tina and Torence Anderson’s baby, Malachi, was diagnosed with spinal muscular atrophy in November 2015, when he was nearly four months old. The doctor who gave the Andersons the news didn’t have much to offer.

“She told us, ‘You have six to twelve months,’” said Ms. Anderson, of Mansfield, Ohio. “Take him home, love him — there’s not really much we can do.”

But after some online research, the Andersons enrolled Malachi in a clinical trial for Zolgensma, and he received the treatment in December.

Malachi is now almost 4 years old — a cheerful, active boy who can push the wheels on his wheelchair, feeds himself and loves to watch shows like “PAW Patrol” and “PJ Masks.”

“Basically he’s like a normal toddler, he just can’t stand or walk,” Ms. Anderson said. Novartis arranged the interview with the Andersons.

The clinical trials of Zolgensma on which the approval was based involved just 36 people. But Novartis said that it has treated about 150 patients, as officials made the treatment available on an emergency basis.

So far, the results do not show that the effects of the treatment have waned, Mr. Lennon said. “We have kids approaching their fifth birthday now, and looking to go to kindergarten next year, which is fantastic,” he said.

Ms. Anderson said many parents with children who have spinal muscular atrophy are excited about the arrival of Zolgensma, but anxious about how it will be paid for. Some worry that if their children are already taking Spinraza, insurance won’t approve treatment with Zolgensma.

“To me, it’s worth saving my child,” Ms. Anderson said. “I’d give up everything — my house, my car, everything. Nothing could put a cost on saving my child’s life.”

But at $2.1 million a treatment, Zolgensma would be out of reach for most American families without the approval of insurance companies.

In addition to the payment plan, Novartis also said it would provide a discount — how much has not been decided — if a patient who takes Zolgensma dies or eventually needs permanent ventilator support.

In exchange, Novartis is asking insurers to promise that they will cover the treatment and that they will quickly decide if a child qualifies. “We know that treating these kids quickly is really paramount,” Mr. Lennon said.

The payment plans will be administered through Accredo, the specialty pharmacy unit of Express Scripts, which is now owned by Cigna.

Dr. Steve Miller, the chief clinical officer of Cigna, said Accredo would collect payment for administering the arrangements with insurers, but declined to say how much, saying that each case would be different.

Cathryn Donaldson, a spokeswoman for America’s Health Insurance Plans, a trade group for insurers, said that while some arrangements — such as money-back guarantees — can be useful, they won’t solve the underlying problem, which is the high prices that the drug makers set.

And while treatments like Zolgensma are promising, she said in a statement, “the data collected on gene therapies is still relatively in its infancy, and they do not have the long-term evidence to confirm they are a lifetime cure.”

Because of the lifesaving nature of the treatment and because the disease is so rare, many insurers are likely to cover Zolgensma. But some experts worried about the cumulative impact should other drug makers follow Novartis’s lead. More than 60 gene therapies are expected on the market by 2024, according to EvaluatePharma.

“The drugs coming to market are going to be things that we will not want to walk away from,” said Dr. Steven D. Pearson, the president of the Institute for Clinical and Economic Review, an independent watchdog group.

The group said that, at $2.1 million, the new drug could be considered cost-effective, in part because it can be used on babies who have not yet shown symptoms of the disease.

Still, Dr. Pearson said in an interview before approval, “the real question is who is going to pay for it?”

Now that Trump’s Forced Drug Prices Into Ads, What’s Next? Lawsuits and Compliance, for Two

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Source: Fierce Pharma

Sorry, pharma. Self-policing didn’t fend off an official rule requiring drug prices in TV ads. And now that the requirement is coming, response from the industry ranges from challenging to cheering—with a few potential lawsuits in the mix.

Last week, the Trump administration said it would in fact require drugmakers put list prices into TV ads, and followed up by publishing the rule Friday in the Federal Register. It’s set to go into effect July 9.

No organization has sued—not yet, at least, because several haven’t ruled it out. The Association of National Advertisers is “seriously considering trying to find a way to block what we think is an unconstitutional proposal by the HHS,” said Dan Jaffe, who heads up ANA’s government relations.

The association is talking to other groups in the industry as it considers a next move, he said, and will likely know which direction they’re going to pursue “in the next week or so.”

The trade group PhRMA is still weighing its options, too. The organization put out an initial statement that echoed its previous stance, saying the rule “could be confusing for patients and may discourage them from seeking needed medical care.” When asked whether the group is considering legal action, Holly Campbell, deputy vice president in public affairs, said, “We are still reviewing the rule, so this is all I can share at the time.”

At least one pharma marketing expert took PhRMA’s confused-patient tack to another level. “Drug prices in TV ads don’t mean a damn thing and may scare patients away from needed prescription drugs to treat health problems. Until we address the lack of transparency around drug costs, adding the list price to ads is like trying to nail jello to the wall,” wrote consultant Richard Meyer on his World of DTC Marketing blog.

GlobalData senior pharma analyst James Mather also cited the murky nature of drug costs and spending as he picked apart the logic of the bill. While it seems to be a sensible approach, he said, the numbers don’t translate into true drug pricing and will cause confusion instead of clarity.

“The intention behind this announcement is clear,” he said. With the move, “Trump is aiming to increase the awareness of high drug prices with the public and apply pressure to companies to lower prices. This short-sighted policy completely ignores one of the core underlying causes of high U.S. drug prices, which is the complex structure of the U.S. healthcare system.”

Meanwhile, the American Medical Association, which has called for a ban on DTC ads in the past, said the rule is “a step in the right direction.”

“This small dose of transparency will help patients have a more complete picture when faced with prescription drug ads,” AMA president Barbara McAneny said in a release. “Patients—especially those who pay a drug’s list price or whose cost-sharing is based on the list price—will now have another tool in their toolbox as they work with their physicians to determine their prescription drug regimens.”

One usually conflicted group that’s largely in favor of the new rule was Congress. Sen. Dick Durbin, D-Illinois, and Sen. Chuck Grassley, R-Iowa, released a bipartisan statement in favor, while a variety of senators and congressional representatives on both sides of the aisle tweeted support for the new rule. Durbin also noted on Twitter that he and Grassley worked to get a similar bill through the Senate in 2018 and will jointly introduce a bill Monday to codify it.

Pharma and healthcare ad agencies will likely bear the brunt of deciphering the new rule and complying with it in creating TV ads.

For instance, one specific detail requires that the price disclosure be in text and use this format: “The list price for a [30-day supply of ] [typical course of treatment with] [name of prescription drug or biological product] is [insert list price]. If you have health insurance that covers drugs, your cost may be different.”

But pharma agencies are used to the highly regulated industry’s requirements and periodic changes to them, and as Leo Tarkovsky, president, McCann Health New York, said, will “do what we need to do for clients.”

“I don’t think we’re fazed or confused or shocked, because if you’re in this business at this particular point in time, you expect that you have to respond to certain developments whether those are regulatory changes, client changes or public discussions,” he said. “It’s our job to figure out communication solutions for our clients and to me that falls squarely in the same bucket.”

Some pharma marketers had already started including list prices and/or links to pricing information. PhRMA members agreed last month to start adding links in ads that would lead to list prices and other detailed cost information, as agreed in the PhRMA DTC Principles announced in October.

Johnson & Johnson was first to add list prices to drug TV ads in February, while Eli Lilly was first to add links to list prices and other detailed cost information in January.

Teva and Other Generic Drugmakers Inflated Prices Up to 1000%, State Prosecutors Say

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Source: New York TImes

Leading drug companies including Teva, Pfizer, Novartis and Mylan conspired to inflate the prices of generic drugs by as much as 1,000 percent, according to a far-reaching lawsuit filed on Friday by 44 states.

The industrywide scheme affected the prices of more than 100 generic drugs, according to the complaint, including lamivudine-zidovudine, which treats H.I.V.; budesonide, an asthma medication; fenofibrate, which treats high cholesterol; amphetamine-dextroamphetamine for A.D.H.D.; oral antibiotics; blood thinners; cancer drugs; contraceptives; and antidepressants.

“We all know that prescription drugs can be expensive,” Gurbir S. Grewal, the New Jersey attorney general, said in a statement. “Now we know that high drug prices have been driven in part by an illegal conspiracy among generic drug companies to inflate their prices.”

In court documents, the state prosecutors lay out a brazen price-fixing scheme involving more than a dozen generic drug companies and just as many executives responsible for sales, marketing and pricing. The complaint alleges that the conspirators knew their efforts to thwart competition were illegal and that they therefore avoided written records by coordinating instead at industry meals, parties, golf outings and other networking events.

The bulk of the collusive activity occurred from July 2013 to January 2015, according to the complaint, when Teva raised prices on nearly 400 formulations of 112 generic drugs. A key element of the scheme, the complaint alleges, was an agreement among competitors to cooperate on pricing so each company could maintain a “fair share” of the generic drug markets. At the same time, the companies colluded to raise prices on as many drugs as possible, according to the complaint.

Though the complaint paints Teva Pharmaceuticals USA, which is based in Pennsylvania, as a leader in the conspiracy, it describes the conduct as “pervasive and industrywide.”

“Rather than enter a particular generic drug market by competing on price in order to gain market share,” the complaint states, “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.”

Teva denied the allegations. “Teva continues to review the issue internally and has not engaged in any conduct that would lead to civil or criminal liability,” the company said in a statement.

The Israeli drugmaker Teva Pharmaceutical Industries is one of the world’s largest manufacturers of generic medicines. The company faced criticism in February 2018 for charging $18,375 for a bottle of 100 pills for a rare medical condition known as Wilson disease. Mylan has also generated outrage for raising the price for a two-injection EpiPen set to over $600 from $100. The latest lawsuit comes as drug companies are already facing widespread scrutiny from lawmakers over drug prices.

The lawsuit was filed in the Federal District Court in Connecticut, where the multistate investigation began. On Saturday, William Tong, the Connecticut attorney general, said on Twitter that the organized effort to maximize profits was “a highly illegal violation of antitrust laws.”

The new lawsuit is a more expansive version of a similar suit filed by the previous Connecticut attorney general in December 2016 in the Federal District Court for the Eastern District of Pennsylvania.

Pfizer denied any wrongdoing in a statement on Saturday. The company said that Greenstone, a Pfizer subsidiary that produces generic drugs, “has been a reliable and trusted supplier of affordable generic medicines for decades and intends to vigorously defend against these claims.”

State prosecutors say the conspiracy has negatively affected the national economy while damaging state health plans and federal health care programs like Medicare and Medicaid.

In his statement, Mr. Grewal described the pharmaceutical industry in New Jersey, where much of the illegal conduct is alleged to have occurred, as “the envy of the world.”

“But no New Jersey company will get a free pass when it violates the law and harms our residents.”

Curbing Drug Rebates Would Cost Billions

Blister pack with dollars instead of pills

Source: BenefitsPro

A key part of the Trump administration’s plan to lower the list prices of drugs wouldn’t actually do so and would end up increasing federal spending by tens of billions of dollars over a decade, the Congressional Budget Office said Thursday.

A proposal put forth by the U.S. Department of Health and Human Services in January would sharply curtail a complex system of drug-price rebates that pharmaceutical companies pay to pharmacy-benefit managers, or PBMs. The rebates give drugmakers’ products favorable placement on list of drugs covered by health-insurance plans. Those lists can steer patients to one product over another, using co-pays or cost sharing to make preferred products cheaper.

Banning them would not have the intended effect of forcing prices down, the CBO said.

“Rather than lowering list prices, manufacturers would offer the renegotiated discounts” in another form, said the CBO, which performs budgetary and economic analysis for Congress.

The proposal would increase spending for Medicare, the U.S. health program for the elderly and disabled, by about $170 billion over 10 years. It would raise federal spending for Medicaid, the shared state-federal health program for low-income people, by about $7 billion in the same period, according to the CBO.

The Pharmaceutical Care Management Association, which represents PBMs, said the report supports what the industry has been saying all along.

“The CBO analysis confirms that the proposed rule on prescription drug rebates will not achieve the administration’s stated goal of reducing prescription drug prices,” PCMA Chief Executive Officer JC Scott said in a statement.

The estimate is a blow to the Trump administration’s drug-cost-reduction efforts, a goal shared by both Republicans and Democrats. Pharmacy benefit managers including those run by Cigna Corp., UnitedHealth Group Inc. and CVS Health Corp., have opposed the idea.

While rebates can be used to lower insurance premiums broadly, they have also resulted in high list prices that some patients pay when they’re outside of their insurance coverage or if they don’t have insurance. In January, HHS Secretary Alex Azar said that eliminating the rebates would “finally ease the burden of the sticker shock that millions of Americans experience every month for the drugs they need.”

The rise in federal costs comes from higher insurance premiums, which otherwise would have been reduced by the rebates. The proposal would also lower out-of-pocket drug costs for some Medicare beneficiaries, according to the CBO, leading to higher drug utilization.

For First Time, Pharmaceutical Distributor Faces Federal Criminal Charges Over Opioid Crisis

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Source: New York Times

Law enforcement officials have long tried to stem the opioid crisis in America with criminal charges for street dealers and cartel kingpins who traffic in drugs like fentanyl and oxycodone.

Now, for the first time, federal authorities are bringing the same kind of felony drug-trafficking charges against a major pharmaceutical distributor and two of its former executives for their role in fanning the crisis.

Prosecutors said the former executives at the company, Rochester Drug Cooperative, ignored red flags and shipped tens of millions of oxycodone pills and fentanyl products to pharmacies they knew were distributing drugs illegally. Their sales soared, as did the compensation of the chief executive.

“Why did they do it?” asked Geoffrey S. Berman, the United States attorney in Manhattan, who announced the charges at a news conference. “Greed.”

Mr. Berman said the case was the first of its kind and vowed his office would “do everything in its power to combat this epidemic, from street-level dealers to the executives who illegally distribute drugs from their boardrooms.”

The government’s novel tactic was expected to reverberate through the pharmaceutical industry, where large corporations and senior executives have long escaped criminal culpability for the epidemic of overdoses from prescription painkillers, like oxycodone.

On Tuesday, prosecutors charged Rochester Drug Cooperative, or RDC, as a corporate entity with conspiring to distribute drugs, conspiracy to defraud the United States and failing to file suspicious order reports.

But the corporation entered into an agreement under which the government will hold off on prosecuting the company on the charges as long as it pays a $20 million fine, complies with the controlled substances law and submits to five years of supervision by an independent monitor.

As part of the agreement, however, the company, the nation’s sixth-largest distributor, admitted in court papers that it intentionally violated federal narcotics laws by shipping dangerous, highly addictive opioids to pharmacies, knowing that the prescription medicines were being sold and used illicitly.

“We made mistakes,” Jeff Eller, a spokesman for the company, said in a statement. “And RDC understands that these mistakes, directed by former management, have serious consequences.”

The two former company officials, Laurence F. Doud III and William Pietruszewski, were also charged with conspiring to distribute drugs and defrauding the government.

Mr. Pietruszewski, 53, of Oak Ridge, N.J., who was the chief compliance officer, was also charged with failing to file reports to the authorities about suspicious orders for controlled substances. He pleaded guilty last week and is cooperating with prosecutors.

Mr. Doud, 75, the former chief executive officer, pleaded not guilty late Tuesday in United States District Court in Manhattan and was released on a $500,000 bond. If convicted, Mr. Doud faces a mandatory 10-year minimum sentence and a maximum of life in prison.

The charging documents portray a company largely animated by Mr. Doud’s greed. As chief executive, he drove up the sales of oxycodone pills up ninefold over four years, from 4.7 million in 2012 to 42.2 million in 2016.

Fentanyl sales shot up even more over the same period, to 1.3 million doses from 63,000 doses, the documents said. And Mr. Doud’s compensation, tied to the sales, more than doubled, climbing to over $1.5 million.

Mr. Doud’s lawyer, Robert C. Gottlieb, said other executives at the company were scapegoating his client for their misdeeds. “Mr. Doud is being framed by others to cover up their wrongdoing,” Mr. Gottlieb said in a statement. “The government has it all wrong. He will fight these charges to his last breath and he will be vindicated.”

Overdoses on prescription opioids have taken more than 200,000 lives in the last two decades, according to the Centers for Disease Control and Prevention.

The charges stem from a two-year Drug Enforcement Administration investigation that began after the company violated the terms of a civil settlement. The company had admitted in the civil case that it had for years failed to report thousands of suspicious opioid orders from pharmacies, many of which flouted order limits and catered to doctors who ran pill mills.

Recent civil lawsuits brought by state attorneys general in New York, Vermont and Washington State have accused Rochester and the nation’s three largest distributors — Cardinal Health, McKesson and AmerisourceBergen — of brazenly devising systems to evade regulators.

At a news conference, Mr. Berman would not address whether other distributors were under investigation.

But Ray Donovan, who leads the New York office of the D.E.A., said the criminal charges against RDC should remind other distributors “of their role as gatekeepers of prescription medication.”

“The distribution of lifesaving medication is paramount to public health,” he said. “Similarly, so is identifying rogue members of the pharmaceutical and medical fields whose diversion contributes to the record-breaking drug overdoses in America.”

John Kinney, the acting chief executive of RDC, which is based in Rochester, N.Y., operates in 10 states and employs close to 200 people, appeared on behalf of the company on Tuesday morning before Judge Naomi Reice Buchwald of United States District Court in Manhattan.

Mr. Kinney signed the deferred prosecution agreement, in which the company effectively admitted committing the crimes. The agreement and a civil settlement, or consent decree, were approved by Judge Reice Buchwald.

Together, the agreement and the decree will allow the company to continue operating and set standards and oversight of its conduct, according to a court document.

State and federal authorities have struggled to hold pharmaceutical distributors accountable, and the lawsuits brought by state attorneys general say that despite signing consent decrees and paying fines, the companies have continued to ship thousands of doses of opioids to troubled pharmacies.

Mr. Doud last year sued RDC, claiming in court papers that the company had wrongfully fired him and that other executives were conspiring to blame him for the conduct that was the subject of the criminal investigation. The lawsuit and the criminal investigation were previously reported by The Democrat and Chronicle of the city of Rochester.

Trump Declares Commitment to Ending Opioid Crisis ‘Once and for All’

Image result for Trump Declares Commitment to Ending Opioid Crisis ‘Once and for All’ imagesSource: New York Times

President Trump, after a week devoted to criticizing the Mueller report and investigations by congressional Democrats, turned on Wednesday to a policy matter, vowing to “smash the grip of addiction” caused by the opioid epidemic.

Addressing a conference of health professionals and addiction specialists in Atlanta, Mr. Trump promised to provide more funding for treatment, stronger scrutiny of what he called Big Pharma and tougher interdiction of drugs at the border with Mexico.

“We will never stop until our job is done, and then maybe we’ll have to find something new,” he said. “And I hope that’s going to be soon, but we will succeed.”

Many leading authorities on the opioid crisis have been highly critical of the federal government’s response as far too slow and inadequately funded, starting with the Obama administration, but say there has been some improvement under Mr. Trump.

Andrew Kolodny, a physician and a director of opioid policy research at the Heller School for Social Policy and Management at Brandeis, said Mr. Trump deserved credit for focusing on the problem, and for delivering more funding than President Barack Obama did.

Still, Dr. Kolodny noted, Mr. Trump, despite his often fiery words, has not offered a comprehensive plan.

“When President Trump designated the problem a public health emergency, something bizarre came out of that,” Dr. Kolodny said. “He gets up and states the U.S. is dealing with an emergency, then offers no plan for what we are going to do about this emergency.”

“It’s like pointing to a burning building, saying there is an emergency, then not calling the fire department,” he said.

Emily Walden, whose son died of a drug overdose in 2012, also said that Mr. Trump seemed to be highlighting the issue more than Mr. Obama did.

“I think he’s done more than the previous president, I will say that,” said Ms. Walden, who is now part of a national group to end opioid addiction. She added that she thought there were “some things they aren’t addressing,” and specified the Food and Drug Administration.

Melania Trump, the first lady, traveled with her husband to Atlanta and addressed the conference before he did. She has made opioids one of her signature issues — particularly the toll the crisis takes on babies and mothers — and it is the one public policy initiative that she and the president work on together.

But Mr. Trump did not use his address to focus solely on opioid addiction, instead pivoting to talk about the strength of the economy and a law enforcement crackdown at the southwestern border, with special praise for drug-sniffing dogs.

He also drew a connection between more aggressive interdiction efforts and his long-promised construction of a border wall.

“We’re going to have a wall. It’s going to be a very powerful wall,” he said, adding that it would have a “tremendous impact” on drugs coming into the country, even though most of the illegal drugs get smuggled through legal ports of entry.

In the past 20 years, overdoses caused by prescription opioids have claimed more than 200,000 lives, according to statistics from the Centers for Disease Control and Prevention, with an uptick in recent years in parts of the country where Mr. Trump is popular, like West Virginia and Ohio.

The president declared the opioid crisis a public health emergency in October 2017. By the next October, according to the White House, the Trump administration had raised $6 billion in new funding to address it.

In 2016, President Barack Obama spoke at the same conference. He announced plans to expand drug treatment centers and to use drugs like naloxone that reverse the effects of opioid overdoses. At the time, Mr. Obama said, “This is still an area that’s grossly under-resourced.” He requested $1.1 billion in additional funds to fight opioid addiction.

Mr. Trump’s appearance at the conference comes a day after the Justice Department announced felony drug-trafficking charges against a drug wholesaler, a legal strategy that has until now been reserved for street dealers and cartel bosses. Prosecutors said executives at the company, Rochester Drug Cooperative, ignored signs of illegal distribution and shipped tens of millions of oxycodone pills and fentanyl products to pharmacies they knew were dispensing drugs illegally.

The president also discussed China’s recent decision to ban all of the variants of fentanyl, a promise the Chinese leader, Xi Jinping, made to him last year. The drug has spread across the United States in the past five years and led to thousands of overdose deaths. China’s new rule is effective on May 1, and many hope that could plug gaps that have allowed some Chinese manufacturers to produce variations of the drug that were not technically illegal.

“They’ve agreed that they are going to make it a major crime,” Mr. Trump said.

China’s ban, however, still does not cover all of the precursor chemicals that are used to make fentanyl and its analogues. These chemicals are typically sent to Mexico from China and are used in composing the fentanyl that is used in the United States.

Fentanyl and its analogues became the leading cause of overdose deaths in 2016 and, according to the C.D.C., contributed to more than a third of deaths the agency counted in 2017.

In Its Fight to Keep Drug Prices High, Big Pharma Leans on Charities

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Source: Los Angeles Times

The U.S. Rural Health Network has a slogan on its website that seems obvious: “We’re fighting for rural health.” But it’s not that simple.

The 2-year-old nonprofit organization hasn’t had much impact in rural health circles, where experts say they’ve never heard of it. It’s also active in a different area: fighting proposals that would cut the cost of prescription drugs. This year, it joined scores of other groups to oppose letting Medicare negotiate prices with drugmakers.

The network, which declines to disclose who funds its work, is part of a gaggle of self-styled patient-advocacy groups with murky origins or hidden funders that have cropped up since 2017. With names like the Doctor-Patient Rights Project or the Defenders Coalition, such groups pursue various policy aims that include effectively aiding pharmaceutical companies’ efforts to defeat drug-price proposals.

The nonprofits take public positions in newspaper op-eds and letters to Congress while drugmakers — beset by years of negative publicity over price hikes — tend to remain in the background. The groups say they’re independent.

That’s not true for all of them, said Marc Boutin, the chief executive of the National Health Council, which has more than 50 patient groups and dozens of drugmakers as members.

“There are a number of groups created by pharma companies that look and act like patient organizations, but they’re 100 percent funded by industry,” said Boutin, who didn’t name any specific examples. “They sound and look like patient organizations, but they take positions that industry wants.”

Boutin said he’s trying to dissuade pharma companies from getting involved in such efforts.

These newer nonprofits often join issue-oriented coalitions alongside established, bona fide patient groups, amplifying their message. Some experts fear they provide a way for drugmakers to influence policy without any disclosure of such efforts.

Typically, the newer groups are created and operated by public-relations or marketing firms with extensive ties to the pharmaceutical industry. They generally refuse to discuss their funding, but Bloomberg News documented that at least one got its seed money from Amgen Inc., whose most lucrative drug, the arthritis medicine Enbrel, has tripled in price since 2010, according to data from IBM Watson Health.

While its funding is unclear, the U.S. Rural Health Network has an illustrative origin story.

It was registered in 2017 by the general counsel of Moore Communications, a Tallahassee, Fla.-based marketing firm. Moore Communications has worked for the drugmakers’ industry group, Pharmaceutical Research and Manufacturers of America, or PhRMA, since at least 2001, including on a national ad campaign in 2014. The firm has also built websites for at least three other patient-focused groups with opaque industry connections.

The rural-health network is a family affair. Its executive director is the sister of Karen Moore, Moore Communications’ chief executive. One of the group’s directors is the mother of a Moore Communications vice president. And the lawyer who registered it is Richard Moore, Karen’s husband and the marketing firm’s general counsel.

The charity’s headquarters, located behind an unmarked door in a building owned by Richard and Karen Moore, was locked on a recent weekday morning.

Across a parking lot, in Moore Communications’ corporate office, Richard Moore described the nonprofit as separate from the marketing company and said he helped launch the organization because “we saw a particular need regarding health issues with rural areas of the country.”

(Four directors of other rural health centers say they’ve never heard of the group. “I don’t know anything about them,” said Alan Morgan, CEO of the 21,000-member National Rural Health Assn., which holds the nation’s largest annual conference on rural health issues.)

Asked to name the nonprofit’s funders, Richard Moore said he’d have to ask some colleagues for the information. Neither the nonprofit nor the marketing firm responded to follow-up requests, but Cheryl Elias, the Rural Health Network’s executive director, said in a written statement that the group takes its positions “independent of outside influence.”

A spokesman for PhRMA, the drugmakers’ industry group, declined to say whether it has funded the nonprofit.

Nonprofits aren’t required to publicly disclose their donors. Some pharmaceutical companies voluntarily disclose at least some of their funding for patient groups, but the full scope of their giving is far from transparent.

Even among long-established patient organizations — founded years ago to address specific diseases or conditions — disclosure is spotty. Matthew McCoy, a University of Pennsylvania professor who teaches medical ethics, found in a 2017 study of 104 patient-advocacy groups that 83% reported receiving money from drugmakers, but only 5% disclosed the exact dollar amounts.

Kaiser Health News reported last year that 14 major drug companies gave a combined $116 million to patient groups in 2015, far more than the $63 million they spent on federal lobbying.

Much of that money benefits disease sufferers or society at large. Patient groups run support networks for those who’ve received life-altering diagnoses. Some support research to develop new treatments for particular diseases. They also create communities of patients from whom drug companies can learn more about particular ailments and how treatments affect people.

But those communities are also stocked with potential policy advocates. And with no disclosure requirements, it’s often impossible to know whether drugmakers’ contributions are shaping the patient groups’ policy stances, said Susannah Rose, associate chief of patient experience at the Cleveland Clinic.

“We need much greater transparency, not only in funding, but also how the money is used,” Rose said.

Long-established groups bristle at the suggestion that the drug industry sways their positions. “There are times when what’s best for the patient aligns with what industry wants,” said Claire Gill, chief mission officer for the 35-year-old National Osteoporosis Foundation. “And there are times when it doesn’t.”

With regard to Medicare and drug prices, the foundation recently aligned with the industry in an unusual way.

In 2017, the group began running an informal coalition called the Protect Medicare Part D Working Group. It organized a January letter that called on Congress to reject plans for letting Medicare negotiate on drug prices; some 200 organizations signed it, including the U.S. Rural Health Network.

The negotiation issue has a tortuous history. When Medicare was expanded to cover prescription drugs in 2003, it became the single-biggest buyer of medicines in the U.S. But while other federal agencies, such as the Department of Veterans Affairs, can use their market clout to seek better deals on drug prices, Congress prohibited Medicare from doing so. Instead, the scores of private insurance providers that offer Medicare plans are left to negotiate individually with drugmakers, with significantly less power.

Now several Democrats, including Sen. Amy Klobuchar of Minnesota, have proposed legislation to let the sprawling health program bargain on behalf of its 43 million beneficiaries.

Gill said the osteoporosis foundation took a leadership role in opposing that plan—not because of any drugmakers’ contributions, but rather the fear that such legislation would eventually force Medicare to cut its coverage of certain high-priced drugs, including some needed by osteoporosis patients. (The foundation gets about $1 million a year, or 20% of its budget, from drugmakers.)

“We support lower prices, but we want to make sure that whatever is proposed actually makes the system better,” Gill said.

Klobuchar’s proposal doesn’t get to that level of detail, but the group’s concern stems from previous research: The Congressional Budget Office has said that Medicare negotiations would yield significant savings only if the program is given the authority to restrict coverage of certain medicines.

Lobbyists with pharmaceutical industry ties have worked behind the scenes with the Medicare Part D Working Group as it attempts to transition to a new, catchier name: the Defenders Coalition. The osteoporosis foundation won’t be running the new version. Instead, initial work on the changeover was done by a Washington-based lobbying firm called NVG Group, which has worked recently for drugmakers such as Merck & Co. Inc., Sanofi and Pfizer Inc., as well as the trade group PhRMA.

The transition also got an assist from lobbyist and former Democratic Sen. Blanche Lincoln. According to a written summary of a January conference call, Lincoln urged members to stick with the coalition and keep fighting “drastic changes” to Medicare. Her company, Lincoln Policy Group, has worked for drugmakers, including AbbVie Inc. and Pfizer, as well as insurers such as Aetna Inc.

Were the lobbying firms paid to help organize the coalition?

“You’d have to ask them,” Gill said of the osteoporosis foundation.

Irene Bueno, a co-founder of NVG, said in an email that her firm is no longer involved in the effort; she didn’t answer questions about who funded her work. Lincoln Policy Group didn’t respond to several telephone calls and emails seeking comment.

The coalition’s January letter against Medicare negotiations appears to have benefited in part from a bandwagon effect. One patient group that signed it was the National LGBT Cancer Project — though its director said in an interview that he really doesn’t know enough about the issue to form an opinion on it. Darryl Mitteldorf, who runs the cancer-patient support group under an umbrella organization called Malecare, said he gets an avalanche of requests to sign policy letters, so he’ll sometimes sign on if he sees other groups he trusts.

Drug companies supply about half of Malecare’s annual operating budget of $209,000, and Mitteldorf calls them “heroes” — “they make the molecules that save lives” — but he’s wary of their influence all the same. He said he turns down drugmakers’ money when their agenda doesn’t fit his organization’s mission, but not every group does that.

“It’s no surprise who’s going to get a favorable response to a grant proposal,” Mitteldorf said, “if you’re licking the boot of pharma.”

Another patient group that popped up in 2017 shows how one pharmaceutical company tried to downplay its involvement.

The Doctor-Patient Rights Project lists 18 members — including the U.S. Rural Health Network and the drugmaker Amgen — and describes itself as a “nonprofit coalition of doctors, patients, caregivers, companies and advocates.” It publishes detailed policy papers and places scores of op-eds in newspapers around the country, mostly criticizing insurance companies for interjecting themselves into medical decisions and steering patients to cheaper therapies.

The group’s website provides scant clues about who operates and funds the coalition — no names or addresses — but there is a phone number. It goes to a voicemail account that doesn’t give a name. After Bloomberg News left a message, a person who called himself “Eli” responded via email and said the group is funded by “private companies, grants, educational institutions and non-profit organizations.” He didn’t reply to a request for actual names.

“DPRP was founded on the idea that medical decision-making should be based on science, not economics,” said Dr. Theresa Rohr-Kirchgraber, a member of the group, in an emailed statement. “The idea that any single entity unduly influences our agenda is categorically false,” said Rohr-Kirchgraber, a past president of the American Medical Women’s Assn.

An Amgen spokeswoman described an organic beginning for the group. The company heard from physicians and patient groups about people who were unable to get the medicines their doctors prescribed, she said.

“As a result, Amgen and other founding members … came together to address the importance of the physician and patient relationship,” she said in a written statement. These founding members, Amgen said, agreed to select a public-relations agency to run the coalition.

But that’s not exactly how it happened. In reality, the Doctor-Patient Rights Project began after a New York-based public-affairs firm called Marathon Strategies pitched the idea to Amgen, according to two people familiar with the group’s beginnings.

Amgen put up the initial money, while Marathon helped recruit other members, built the website, wrote the reports and placed the op-eds in newspapers. The marketing company declined to comment.

Questioned about this timeline, Amgen provided an updated statement, saying the company — and not the coalition’s member groups — selected Marathon based on their past relationship. It added that while Amgen provided the “seed money” to launch the group, other groups and companies have contributed since.

It declined to name them.

Top GOP Senator Working on Bipartisan Drug Price Bill for Mid-June

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Source: The Hill

Senate Finance Committee Chairman Chuck Grassley (R-Iowa) said this week that he is aiming to introduce bipartisan legislation by mid-June to lower drug prices.

Grassley, who made the announcement Thursday during a speech in Iowa, said he is working with the top Democrat on his committee, Sen. Ron Wyden (Ore.), to try to find a path forward on an issue that is a priority for Democrats and President Trump.

“We are writing legislation to address some of the systemic problems that make prescription drugs unaffordable for some Americans,” Grassley said in the speech, according to prepared remarks. “I expect that legislation to be ready for introduction in mid-June of this year.”

Wyden’s office on Friday confirmed that the two senators are working together on a bill.

Grassley’s effort is being closely watched to see how far he will go in taking on drug companies to help lower prices. Grassley is well known for his willingness to support some legislation opposed by the pharmaceutical industry, but he has so far stopped short of endorsing Democrats’ No. 1 priority on the issue: allowing Medicare to negotiate drug prices.

Details are scant on the legislation Grassley and Wyden are working on.

The pair convened three hearings earlier this year to examine drug prices, including a high-profile event in February where drug company CEOs testified.

“I’ve heard from people all over the state of Iowa about high prescription drug prices,” Grassley said in Thursday’s speech to the Global Insurance Symposium. “I’ve heard stories of people leaving their prescriptions at the drug store counter or rationing their insulin in order to make ends meet. Both of these are prescriptions for bad health care outcomes.”

CMS Rule Aims to Block Use of Drugmaker Coupons on ACA Plan Members’ Out-of-Pocket Costs

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Source: Fierce Healthcare

CMS is taking aim at increasing the use of generic drugs in ACA plans in a new rule filed Thursday evening.

In the rule (PDF), the Centers for Medicare & Medicaid Services included a provision to allow insurers in the 2020 plan year to implement copay accumulator programs that would block the use of manufacturer coupons to lower annual out-of-pocket costs on certain brand name drugs when there’s a generic available.

Virginia and West Virginia have banned these programs in their individual markets, and several additional states are considering similar moves.

CMS, however, argues that the practce would decrease drug spending and encourage people to use generics.

“At CMS, we have improved the operations of the exchange to deliver a better consumer experience at a lower cost,” CMS Administrator Seema Verma said in an announcement.

Here’s a look at the collection of notes and changes CMS included in the new rule:

  • CMS reiterated its support for a legislative fix to end ACA plan “silver-loading,” including the potential for cost-sharing reduction payments to be reinstated. It noted that all the comments it received in response to a request for more information in the proposed rule supported allowing silver loading to continue.

Insurers offering plans on the Affordable Care Act exchanges responded to the Trump administration’s 2017 decision to end CSRs by stacking most premium increases on silver plans, which are used to determine federal subsidies. This offered an alternative way to lower cost-sharing.

“The administration supports a legislative solution that would appropriate CSR payments and end silver loading,” CMS said in the rule. “In the absence of congressional action, we sought comment on ways in which HHS might address silver loading.”

It did not take any action to change the practice. The earliest it might act would be for the 2021 plan year, CMS said.

  • CMS is also considering changes for automatic re-enrollment in 2021, according to the rule. The agency requested feedback on changes in this area as well in the proposed rule. CMS expressed concern that the current form of re-enrollment may prevent plan members from updating their information in a timely manner, which could lead to wasteful spending on tax credits.

All commenters that weighed-in on the issue called for CMS to leave the current re-enrollment policy in place, as it eases administrative burden and can prevent lapses in coverage.

CMS said it will consider those responses as “we continue to explore options to improve exchange program integrity.”

  • The rule also finalizes several policy adjustments for the 2020 plan year in the individual, small group and large group markets. The agency reduced user fees borne by insurers that funds operation of state exchanges and from 3% to 2.5%.

This decrease will go toward further decreasing premiums, CMS said.

  • CMS also aimed to improve transparency in its enhanced direct enrollment program, which allows people to sign up for ACA plans directly through an approved payer or broker without the need to visit Web brokers will be required to provide the agency will a list of brokers and agents that use their platforms.

Pharma Lobby Nears Spending Records With Drug Prices Under Fire

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Source: Bloomberg

Large drug makers and the industry’s primary trade group neared previous spending records on lobbying in the first three months of the year as President Donald Trump and Congress increased pressure to rein in the cost of medicine.

The Pharmaceutical Research and Manufacturers of America trade group, which represents 37 drug companies, spent $9.91 million in the first quarter, up from $6.03 million during the last quarter of 2018, and just shy of its record a year earlier, according to disclosures filed with Congress before a Monday deadline.

Drug companies are facing an unprecedented threat to their pricing practices as the president and lawmakers from both parties have targeted the high costs of drugs. That has become one of the few areas of bipartisan agreement in an otherwise divisive political climate.

The Trump administration has proposed new rules and approved a slew of new generic drugs, sending a signal that more ambitious changes may be needed to lower pharmaceutical prices for Americans. That’s spurred drugmakers to reveal prices of their prescription drugs on websites for the first time in a bid to avoid being forced to make even more public disclosures in TV ads.

Two of the world’s biggest insulin producers started offering bigger discounts — prompting Congress to call for more action and criticize the companies for waiting for so long.

Quarterly Increases

AbbVie Inc.AstraZeneca PlcBayer AGBiogen Inc.Bristol-Myers Squibb Co.Merck & Co. Inc., Novartis AGPfizer Inc. and Sanofi all bolstered their first-quarter spending compared with the fourth quarter, according to the filings.

Novartis hiked its spending an eye-popping 450 percent to $3.2 million from $580,000, and that figure was also about 5 percent above what it spent a year earlier, the filings show. Merck spent $2.74 million in the period, more than 200 percent more than in the last quarter of 2018, but that figure was down more than 17 percent compared with the year before, when it was one of several companies to set a group record.

AstraZeneca, Biogen and Bristol-Myers all spent more than their year-earlier levels. Those companies and AbbVie, Merck, Novartis, Pfizer, Sanofi, Johnson & Johnson all disclosed lobbying on drug pricing, among other issues.

The tide has turned for drug companies in Washington after years of being able to keep Congress at bay. A February hearing before the Senate Finance Committee that called on top officials from seven major drugmakers was touted as a moment of reckoning that could lead to a clampdown similar to what Big Tobacco faced in the late 1990s. But there were few fireworks, with lawmakers largely refraining from bashing the companies, which blamed a patchwork of incentives for high out-of-pocket costs for patients.

One sign that the drug lobby was losing its grip on Congress came in the first quarter of 2018, when PhRMA was blindsided by a change lawmakers made to Medicare that put drugmakers on the hook for more of seniors’ prescription costs. In that quarter, PhRMA and companies including AbbVie, Bayer, Celgene Corp.Novo Nordisk A/S and Sanofi set quarterly lobbying spending records.

America’s Health Insurance Plans, a trade group representing insurers, spent $2.88 million on lobbying, including on Medicare for All, according to its disclosure. That figure was up more than 87 percent from the previous quarter and up 26 percent from a year earlier.

The disclosures generally don’t say what positions a trade association or company took on any given issue.

Medicare for All has become a litmus test between progressives and moderates in the race for the 2020 Democratic presidential nomination.

Last Updated 06/19/2019

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