KHN Morning Briefing

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Generic Drug Marketplace Is A Fragile Place Where Competition Can Quickly Wither Into Monopolies

News outlets report on stories related to pharmaceutical pricing.

The Washington Post: The Generic Drug Industry Has Brought Huge Cost Savings. That May Be Changing.
A decade ago, physicians who treat epilepsy got what seemed like a piece of good news: Eight companies had received federal approval to sell a generic version of an injectable lifesaving drug. Doctors liked the brand-name drug Cerebyx because it was safer and easier to use than a previous medicine that stopped seizures but could cause terrible skin reactions. The only problem was that it was too expensive for many hospital pharmacy budgets. A widely available and cheaper generic version would remove those cost barriers — or so doctors thought. (Johnson, 8/1)

Stat: Bernie Sanders Proposes Rule To Require Drug Makers To Charge Fair Prices
In response to a furor over medicines discovered with taxpayer dollars, Sen. Bernie Sanders (I-Vt.) is proposing a new rule to require drug makers to charge fair prices. The move would force federal agencies and federally funded nonprofit institutions, including universities, to negotiate a reasonable pricing agreement before granting exclusive rights to make prescription drugs. (Silverman, 7/31)

Stat: Pharma Transparency Policies Are Vague And Contradictory, Analysis Finds
After several years in which drug makers have been pressured to release clinical trial data, a new analysis finds many companies are still doing an incomplete or inconsistent job of being transparent. Overall, 95 percent of the 42 companies reviewed – including the 25 largest drug makers, based on sales – had a publicly accessible policy. Otherwise, however, the specifics often varied wildly in terms of what is disclosed and even how to interpret some of the policies. (Silverman, 7/26)

Kaiser Health News: Drug Puts A $750,000 ‘Price Tag On Life’
Jana Gundy and Amanda Chaffin live within two hours of each other in Oklahoma. Each has a child with the same devastating disease, one that robs them of muscle strength, affecting their ability to sit, stand or even breathe. So both families were ecstatic when the Food and Drug Administration approved the first treatment for the genetic condition — known as spinal muscular atrophy (SMA) — two days before Christmas 2016. It seemed the gift they had been waiting for — a chance to slow the heartbreaking decline of their young sons. (Appleby, 8/2)

Kaiser Health News: Denial, Appeal, Approval … An Adult’s Thorny Path To Spinraza Coverage
Tammi Bradley jumped on her computer the minute she heard the news about the Food and Drug Administration’s approval of a drug targeting spinal muscular atrophy (SMA), a progressive muscle-weakening condition she’s had since childhood. “That night, I wrote to all my neurology doctors and my personal physician, saying I was interested in obtaining this treatment,” recalled the 51-year-old Citrus Heights, Calif., resident. (Appleby, 8/2)

CBS News: Can Tech Ease The Pain Of Soaring Drug Costs?
The internet has transformed the way consumers buy everything from clothes and cars to food and movie tickets. Can the power of technology also disrupt how Americans purchase prescription drugs? Certainly, it is an area crying out for innovation amid soaring cost increases that are straining the budgets of Americans who rely on medication to manage pain or chronic disease. Prescription drug costs for those under age 65, which shot up more than 11 percent in 2016, are are projected to jump nearly 12 percent this year, according to research firm Segal Consulting. And generic drugs, while cheaper, are no panacea given their own price increases and lack of availability for many medical conditions. (7/31)

Stat: Pharma Companies Flock To New Drug Production Approach To Save Money
Making a drug is a bit like baking — in the goopiest, messiest sense possible. Just ask Janet Woodcock, director of the Food and Drug Administration’s Center for Drug Evaluation and Research. “We take the [inactive] and active [ingredients] and put them into a giant pot. It looks like a gigantic cake mixer. And then we … take that mush and we squeeze it out into a string and put it into tablets,” said Woodcock. “It’s a mess, it gets all over the place.” (Wosen, 7/26)

Reuters: As Drug Prices Drop, Generics Makers Fight Back With Deals
Generic drug makers are turning to M&A to shield themselves against a concerted effort by U.S. regulators to crack down on steep drug prices. Impax Laboratories Inc (IPXL.O), Perrigo Company Plc (PRGO.N) and Alvogen Inc have been talking to advisers about strategic options for their generics businesses, ranging from acquisitions to increase scale to an outright sale of the units, people familiar with the matter said this week. The persons declined to speak for attribution because the discussions are private. (O'Donnell, 7/27)

Stat: A Bid For HHS To Override Patents On Pricey Drugs Is Shot Down
An Ohio congresswoman unsuccessfully attempted to make it possible for the U.S. Department of Health and Human Services to conduct an end run around companies that price drugs —  developed with taxpayer dollars — higher than what is charged in seven other high-income countries. Last week, Rep. Marcy Kaptur (D-Ohio) introduced an amendment to a House appropriations bill that would have authorized HHS to exercise rights in a federal law which, under certain circumstances, would permit a company — other than the licensed patent holder — to make a lower-cost version of a drug. (Silverman, 7/25)

Cleveland Plain Dealer: Issue 2 Opponents Spent $9.7 Million Against Ohio Drug Price Measure
Opponents to a ballot measure that seeks to curb the money the state spends on pharmaceutical drugs has spent three times as much as supporters of Issue 2 and in less time. Ohioans Against the Deceptive Rx Ballot Issue spent $9.7 million of the $15.8 million it has raised from May 30 to June 21, according to campaign finance reports filed Monday with the Ohio secretary of state. (Hancock, 7/31)

Stat: Express Scripts To Further Tighten Patient Access To Prescription Drugs
Express Scripts, the nation’s largest pharmacy benefits manager, will exclude an additional 64 medicines next year from its formulary – the list of drugs that get preferred insurance coverage. The company estimates that restricting access to the drugs will save health plans an extra $700 million. (Silverman, 7/31)

Stat: Drug Makers Fund More Compassionate Use Programs Than You May Think
Patient advocates have long complained that drug and device makers do not make enough experimental medicines available, but a new study finds that the industry funds most trials that aim to get such products to patients. Specifically, companies funded 61 percent of nearly 400 studies that make drugs or devices available to patients prior to regulatory approval, according to the analysis in BMS Research Notes. And the researchers suggest that, even without federal intervention, industry is “establishing programs to make experimental therapies available to terminally ill patients.” (Silverman, 7/31)

Stat: To Go After Drug-Resistant Gonorrhea, Partners Put A New Spin On Drug Development
Only three types of drug-resistant bacteria make the Center for Disease Control and Prevention’s list of  “urgent” threats. One of them is gonorrhea. That particular sexually transmitted infection is the target of a new drug being developed by Entasis, an antibiotics-focused spin-off from pharma giant AstraZeneca. But they’re getting help: their nonprofit partner, the Global Antibiotic Research and Development Partnership, will be funding the next round of trials and doing studies to ensure this drug keeps working for as long as possible. The partnership is GARDP’s first. (Sheridan, 7/31)

Bloomberg: Biogen Says It's Under Investigation By Milan Prosecutor 
Biogen Inc. said its interactions with health-care providers in Italy are under investigation by a prosecutor in Milan. The drugmaker learned of the investigation this month and is cooperating with the Italian government, according to a securities filing Tuesday. The company didn’t provide further details about the probe. Biogen spokesman Matt Fearer confirmed by email that the company’s Milan office was visited by officials acting on behalf of the prosecution Office of that city, adding it would be inappropriate to comment further. (Bloomfield, 7/25)

Reuters: AstraZeneca A Tricky Takeover Target After Big Cancer Drug Blow
Hurdles ranging from existing commercial tie-ups to politics make drugmaker AstraZeneca a problematic takeover target in the wake of last week's big lung cancer setback that hammered the stock and rekindled takeover talk. Industry executives and bankers say Pfizer, which failed to buy it for $118 billion in 2014, is unlikely to return, while European rivals Novartis, Sanofi and GlaxoSmithKline are wary of large deals. (8/1)

Bloomberg: Celgene Settles Whistle-Blower Fraud Suit For $280 Million 
Celgene Corp. agreed to pay $280 million to resolve a whistle-blower’s claims the drugmaker used illegal marketing tactics to turn its Thalomid and Revlimid cancer drugs into blockbuster sellers, the U.S. said. The settlement ends claims by a former company saleswoman that Celgene defrauded federal and state Medicare programs out of billions by luring doctors into prescribing the cancer drugs for unapproved uses, Acting U.S. Attorney Sandra Brown in Los Angeles said Tuesday in a statement. (Feeley and Bloomfield, 7/25)

Reuters: EU Drugs Agency Cuts Workload As Prepares For Brexit Disruption
Europe's drugs regulator is cutting back on lower-priority work as it prepares for disruption caused by Brexit and the need to relocate from London to another city inside the European Union. The European Medicines Agency (EMA) said on Tuesday its "business continuity plan" meant it would suspend work on a new web portal and an electronic submission project for drugs, as well as the development of a transparency roadmap. (Hirschler, 8/1)

The New York Times: Jury In Martin Shkreli Fraud Trial Has Questions For The Judge
The first substantive note from jurors in Martin Shkreli’s fraud trial asked on Tuesday about assets under management and what “fraudulent intent” meant. The jurors had been deliberating for more than a day and a half in Mr. Shkreli’s trial in the Federal District Court in Brooklyn. They had not asked any questions other than, on Monday, what time they were supposed to leave at night. (Clifford, 8/1)

USA Today: Martin Shkreli Jurors Seek Legal Definition Of 'Fraudulent Intent'
Jurors weighing the fraud case against 'Pharmacy Bro' Martin Shkreli Tuesday asked for legal definitions of "fraudulent intent" and "assets under management. "In a note sent during the second day of deliberations, the seven women and five men also asked whether the Shkreli assets under management in the case referred to a particular financial fund or all assets handled by the portfolio manager or general partner. (McCoy, 8/1)

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