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Drugstores push for access to secret PBM pricing-and-reimbursement info

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Mar 282013

Transparency may be a trendy topic in pharma these days. But while drugmakers have been opening their files on financial relationships with doctors–even edging toward sharing trial data–they haven't said much about proprietary pricing info. Discounts and rebates tend to be closely guarded. Now, state legislators might force some pricing information into the open. As The Wall Street Journal reports, drugstores are lobbying for legislation that would force pharmacy benefits managers to share their reimbursement rates. That way, independent stores would know how much their rivals are getting for each drug–and could help them negotiate better pricing deals. It's one more consequence of the patent cliff . With big drugs falling off patent, generics are accounting for a growing share of prescription revenue, and drugstores' profit margins on generic drugs are much smaller than those on branded meds. Big pharmacy chains have more power to negotiate favorable prices, but even they are suffering from the margin squeeze. Drugstores argue that PBMs are maintaining their own margins while cutting reimbursements for pharmacies. As the WSJ notes, PBMs deny that they're keeping a disproportionate share of drug profits. They say the laws would give pharmacies the opportunity to collude on pricing. Not surprisingly, they are fighting the disclosure bills. This isn't pharma's own pricing data, of course. Drugmakers have to report wholesale pricing information to Medicare and Medicaid , because the government programs' reimbursement rates are based on the averages. But other pricing arrangements–with hospitals, wholesalers, and the like–are proprietary. The PBMs argue that opening access to pricing data could have unintended consequences. The info could inspire shifts to branded drugs, for instance. And drugstores themselves say they might steer away from money-losing drugs, which could restrict access to cheaper meds. – read the WSJ piece Related Articles: Disclosure trend hits PBM-drugmaker deals Pfizer's Lipitor survival strategy under attack More generics, more frugal clients for Medco GSK ups the ante for trial transparency

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Drugstores push for access to secret PBM pricing-and-reimbursement info

Generics dampen US drug spending; payers fear rising specialty costs

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Mar 192013

It's confirmed: Another study shows that U.S. drug spending dropped ever so slightly last year. The obvious culprit is generic drugs , with major blockbusters such as Pfizer's ( $PFE ) Lipitor and AstraZeneca's ( $AZN ) Seroquel IR now facing cheap rivals. But has the drug market absorbed about as much generic use as it can take? Utilization last year stood at 84%, IMS Health reports. That's the highest rate ever. IMS figures that rate can tick upward by two or three more percentage points, but no further. That's partly because the worst of the patent cliff is passing. As fewer big blockbusters go generic, there's less room for generics growth. And the danger of that, of course, is that the big drop in primary-care drug spending will be surpassed by an even bigger increase in specialty drug costs. You'll recall that earlier this month, Express Scripts rolled out numbers showing that specialty drug spending had increased by 18.4% last year. And specialty drugs are pharma's primary focus these days, partly because they can bear premium price tags. They're also difficult to copy. The theory is that payers are willing to pay top dollar for rare-disease drugs and other pricey specialty treatments, because few patients need them. Their price tags may be higher, but their absolute costs, compared with primary-care drugs, are lower. But drugmakers may find themselves back-pedaling on that as insurers and government payers watch the costs add up. “This is a charmed era that won't last forever,” Paul B. Ginsburg, president of the Center for Studying Health System Change, told the NYT . “When you talk to benefits managers at large employers or insurers, the trend of specialty pharma is very, very prominent. You might even say they regard it as their biggest problem.” – read the NYT piece Related Articles: GlaxoSmithKline chief says new-drug prices should drop as R&D improves Generics bite primary-care sales, but specialty drugs soar 18.4% HHS figures tell 2 stories about Medicare drug spending Branded drug prices leap 13% in U.S., far outpacing inflation Employers eye costs of specialty drugs

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Generics dampen US drug spending; payers fear rising specialty costs

Generics dampen US drug spending; payers fear rising specialty costs

Pharma Industry Business News No Responses »

Mar 192013

Apotex, Waxman take sides against pharma in Supreme Court generics cases

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Mar 182013

The Supreme Court is hopping with pharma news these days. As the top U.S. court prepares to hear arguments tomorrow in the big generics-liability case, some key lawmakers in the generics world are balking at the whole federal-preemption idea. Meanwhile,? Apotex has filed a brief in the pay-for-delay case nearing its hearing date–and this generics maker sides with the Federal Trade Commission . Against the drug industry. The generics-liability case has been wending its way through the courts for years now, with a debate at each major juncture. Now, the Supreme Court will have its say. The argument is that generics makers can't be held liable for patients' injuries because the FDA approved the branded version and the label warnings attached. The Justice Department filed a brief in favor of that idea, saying that FDA has the say-so on drug safety. But Rep. Henry Waxman, of Hatch-Waxman Act fame, says Congress never meant for generic-drug legislation to shield companies from liability suits in state court. In a legal brief, Waxman says FDA approval shouldn't preempt lawsuits over drug safety. Congress has never passed a provision allowing FDA approval to shield companies from lawsuits, he said. And he cited a 2009 case noting that even FDA has said that lawsuits play an important role in drug oversight. “The decision whether to preempt state-law claims, for decades left to Congress, properly remains with Congress,” the brief states (as quoted by The Hill ). The pay-for-delay case has its own saga-length back story. Suffice it to say that the FTC sees certain patent settlements as anti-competitive. The agency believes that the deals between branded drugmakers and their would-be copycats delay the launch of cheap generics, costing consumers and government payers billions. Drugmakers, generic and branded alike, are in favor of the deals as a way to curtail litigation costs and set an agreed-upon date for generic launch. The settlements usually involve a cash payment from the branded company to the patent-challenging generics maker. A series of industry heavyweights has filed briefs supporting the drugmakers in the case, AbbVie ( $ABBV ) and Actavis (which used to be Solvay Pharmaceuticals and Watson Pharmaceuticals, respectively). The Generic Pharmaceuticals Association, Merck ( $MRK )?and Bayer are among them. But now, the Canadian drugmaker Apotex has filed its brief on the FTC's side. As The Wall Street Journal reports, Apotex says the patent settlements in question simply allow branded drugmakers and generics companies to “divvy up ill-deserved monopoly profits.” And yes, Apotex says, that poses an “enormous cost” to consumers. Among other things, Apotex says these pay-for-delay settlements discourage other patent challengers. “[T]he system envisions patents getting tested,” Apotex's director of government affairs, Steve Giuli, told the Journal . “There are going to be a lot of cases where generics litigate and win.” – see The Hill' s piece – get the Reuters story – read the WSJ article (sub. req.) Related Articles: Bayer, Merck join fight against FTC in pay-for-delay case Generic Reglan user can sue Pfizer for damages Pay-for-delay to get Supreme consideration Supreme Court to review key generic drug case

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Apotex, Waxman take sides against pharma in Supreme Court generics cases

Generic drugmakers concerned over FDA turmoil

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Mar 152013

Generic drugmakers are feeling a little taken advantage of. They produce 80% of the drugs used in the U.S. Their products are saving federal health programs billions of dollars, and they are now helping cover some of the FDA budget through user fees. But it took the FDA two years to fill the top position at the Office of Generic Drugs (OGD), and then after 8 months the new director, Dr. Gregory Geba, is calling it quits. His resignation today comes as about half the OGD?staff?is being reassigned to a new office overseeing quality. Ralph Neas–Courtesy of GPhA “Now, with Dr. Geba's departure, we are significantly concerned about further disruption at the FDA,” Ralph Neas, CEO of the Generic Pharmaceutical Association ( GPhA ), said in a statement Thursday. “These vacancies and changes hold the potential to distract from the critical mission of the OGD, and slow the flow of information, guidance, and approvals needed to achieve an optimal generic drugs market for patients, payers and the health care system … We trust that FDA is doing everything possible to ensure that the Office of Generic Drugs is fully staffed so that it can continue its regulatory mandate and GDUFA implementation.” The director's position was open from 2010 to 2012, before Dr. Geba was hired. Then, two months after Geba was recruited from private industry last year, CDER Director Janet Woodcock elevated the OGD to “super office” status, giving it oversight over some other offices in the agency. It was a suggestion the office was going to get the respect those in the generic drug business believe it deserves. At the same time, however, Woodcock created the Office of Pharmaceutical Quality and gave it responsibility to oversee quality throughout the life cycle of a drug. As part of that, the chemists in the OGD–perhaps half of its staff of 300–will move to the new office. In a note to his staff obtained by FiercePharma , Geba said he “fully” supports the new emphasis on quality but was concerned that taking resources away from OGD would make it difficult to accomplish its goals. “The pending realignment of OGD's CMC functions and movement of the chemistry divisions into the proposed new Office of Pharmaceutical Quality inevitably resets the scope of responsibilities and remit of our office.” His resignation happens today and it has spurred talk about just how committed Woodcock and the FDA really are to generic drugs. Bob Pollock, who was acting deputy director of the OGD before leaving in 1994 to work for Lachman Consultants hinted at disgruntlement in a blog post this week. “While we have not heard of any specific reason for his resignation, one could speculate that Dr. Geba was not happy with the announced organizational changes affecting the OGD. While, on one hand, being elevated to Super Office Status, on the other, the OGD chemists appear to be heading out of OGD into the Office of Drug Product Quality. This, which could potentially reduce immediate OGD staff by almost 50%, could be a reason for the move … At this critical time for OGD with GDUFA implementation in full swing, we will now have to see how the Agency responds.” – here is Ralph Neas' statement – read Pollock's blog post Related Articles: FDA gives generic drugs 'super' status FDA's Woodcock changing up drug quality oversight After Wellbutrin fiasco, FDA takes a look at generic equivalence

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Generic drugmakers concerned over FDA turmoil

Cipla shoots South Africa's Cipla Medpro a better offer

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Mar 012013

India 's Cipla and its South African namesake?Cipla Medpro may share a moniker but they haven't seen eye-to-eye on what it will take to share ownership. So Cipla is back with a better offer: It now says it will pay $500 million for 51% control of Cipla Medpro. That is significantly higher than the $215 million opening bid it made in November and about 17% higher than its last offer, the Economic Times reports. The Indian generics maker already supplies most of the drugs that Cipla Medpro sells, but the two have never had any common ownership. Cipla Medpro, is the third-largest drugmaker in South Africa, a rapidly growing market. Story ?| More ?

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Cipla shoots South Africa’s Cipla Medpro a better offer

Fewer generics approved in 2012 but still a banner year

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Mar 012013

Given all the lousy earnings reports and patent cliff talk, one might have expected last year to be the biggest ever for getting new generic drugs into the U.S. market. One would be wrong. At least in terms of numbers of generic drugs approved in the U.S., 2012 was a down year, reports Thomson Reuters?in its just-released quarterly report on the U.S. generics industry. There were 506 approvals from 92 “corporate entities” in 16 countries. That was down 7.5% from the 547 approved the year before. Not surprisingly, India 's generic makers led the way, with 205 approvals, while U.S. drugmakers nailed 171 last year. Thomson Reuters reports that in the final quarter of the year, Indian companies received 44 approvals and U.S. companies were granted 45. That is not to say that 2012 was not a very wrenching year for branded drugmakers. Megablockbusters like Plavix from Sanofi ( $SNY ) and Bristol-Myers Squibb ( $BMY ) and Merck's ( $MRK ) Singulair fell to generic competition . Generic drugs now hold a very special place in the U.S. and world markets. Generic drugs account for about 85% of the 4 billion prescriptions written in the U.S. each year. The FDA has even elevated its Office of Generic Drugs (OGD) to “super office” status, partly recognizing that generic drugmakers are now kicking in a significant part of the agency's budget through user fees. The make-up of the generic industry also is changing. In the final quarter, Watson Pharmaceuticals closed its $5.5 billion deal to buy Actavis ( $ACT ) and assumed the Actavis name. It was just one of the deals that reflect that generic drugmakers feel the need to muscle up and become more efficient in the face of strong competition. This year promises to be a big one in the generic industry as well. Next month the U.S. Supreme Court is expected to rule on whether so-called pay-to-delay agreements are constitutional. And generic drugmakers show no signs of easing up in their pursuit of their very large piece of the market. There were more than 40 patent infringement lawsuits filed over 24 drugs in the final three months of 2012, Thomson Reuters reports. Teva Pharmaceutical Industries ( $TEVA ) is the most aggressive with ties to challenges for 160 compounds or combinations.? – read the report (PDF) Special Reports: Top 20 generic molecules worldwide | Top 11 Fastest-Growing Generics Companies Related Articles: FDA gives generic drugs 'super' status Watson becomes Actavis, and already future is muted Generic savings tell a different patent-loss tale Pay-for-delay to get Supreme consideration

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Fewer generics approved in 2012 but still a banner year

India may kill compulsory licensing based on price

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Feb 272013

India is considering killing compulsory licenses in some cases, replacing that detested provision with price controls–another law Western drugmakers dislike but prefer over having their patents rendered meaningless. The Department of Pharmaceuticals has issued a draft guidance that says once patented drugs come under proposed price controls, their cost should be considered reasonable and it should not be possible to issue a compulsory license based on affordability, the Economic Times reports. Other reasons might still be invoked. Compulsory licenses can be granted to makers of generic drugs when the government believes the price of a lifesaving drug keeps many patients from affording it. Last year, India granted its first compulsory license to Natco Pharma to make a generic version of Bayer 's kidney cancer drug Nexavar . It justified the decision on price. Natco began selling it for $170 a month, compared with Bayer's $5,000 a month price. Cipla , another Indian generics maker, jumped right in as well, offering it at $130 a month. Bayer fought but lost the decision, which generated great angst among Western drugmakers fearful of losing their pricing leverage on their most expensive drugs in a market they believe is ripe for expansion. Natco and others have said they intend to seek compulsory licenses for other drugs. Western drugmakers are also leery of the price controls that India is instituting. India for years had prices set for about 75 generic drugs but has upped that now to about 350. Generic drugs made by the Indian subsidiaries of Western drugmakers are believed to be hardest hit because they are priced higher than locally made generics. Western drugmakers believed their brand name gave them an edge in the market. India is also creating a health program that would pay for more drugs for the poor, which should benefit drugmakers but is too new to determine by how much.? – read the Economic Times story Related Articles: Natco?may next attack Pfizer, Roche drugs with compulsory license Indian government forces Bayer to accept generic?Nexavar?competition New Indian price caps would raise another hurdle to Big?Pharma Even some domestic firms rail at India's price control plan

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India may kill compulsory licensing based on price

FDA approves generic Doxil to combat drug shortage

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Feb 042013

The FDA approved a generic of Johnson & Johnson's cancer drug Doxil.–Courtesy of J&J It can pay to play with the FDA when it needs help with drug shortages. In a push to ease a months-long shortage of Johnson & Johnson's?( $JNJ )?cancer drug? Doxil , the FDA fast-tracked a generic from? Sun Pharma , approving it Monday. Since February, the FDA had been allowing Sun to import its unapproved version of the Doxil substitute as one way for the agency to address the shortage.? Doxorubicin hydrochloride liposome injection sits on the FDA's drug shortage list, meaning the regulatory agency's Office of Generic Drugs can use a priority review system to bump a generic application for the drug to the front of the line. Sun's product, which will be available in 20-mg and 50-mg vials, will help patients who suffer from ovarian cancer, AIDS-related Kaposi's sarcoma and multiple myeloma. Manufacturing problems at Ben Venue Laboratories , a unit of Boehringer Ingelheim that makes Doxil, forced the contractor to suspend operations in November 2011, exacerbating supply issues for the drug. By February 2012, FDA Commissioner Margaret Hamburg had called upon Sun Pharma to import Lipodox , a Doxil substitute that the FDA had not approved. The company manufactured the injection at an FDA-approved facility in India. “The agency is committed to doing everything we can to address drug shortages so that patients can get the medicines they need when they need them,” said Capt. Valerie Jensen, director, drug shortage staff at FDA. “For the past year, the FDA has been working to ensure that supplies of doxorubicin HCl liposome injection were not interrupted.” That work wasn't seamless, though; the FDA searched for substitutes and solutions for shortages, while a U.S. House committee criticized its regulatory aggressiveness. The committee blamed the agency for four plant closings in which production interruptions created or exacerbated shortages of many drugs. The FDA responded by saying such action was necessary to preserve patient safety. Ben Venue announced a consent decree with the FDA regarding its Bedford, OH, plant last month. The decree bans the plant from making some drugs until the agency is satisfied that problems at the plant–more than 100 basic preventative maintenance activities hadn't been taken care of for at least a month–are cleared up. But the FDA will let the plant manufacture 100 drugs considered “essential for patient care.” The contractor said it invested more than $300 million to upgrade its Ohio plant and began limited production in October. The FDA said today that it “intends to continue exercising enforcement discretion for importation of Lipodox” until sufficient supplies of the approved generic are available. – read the FDA release – get more from Reuters Special Report: Boehringer Ingelheim, Ben Venue Laboratories – Fierce's 2012 Top 10 FDA Red Flags Related Articles: Ben Venue consent decree softened to account for drug shortages J&J releases Doxil batch; Ben Venue troubles detailed in FDA report Turbulence ahead for cancer drugs with Ben Venue exit FDA brings Sun's Doxil copy online to fix shortage FDA to Congress: Agency not the cause of drug shortages

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FDA approves generic Doxil to combat drug shortage

France herds patients, pharmacists toward cheap generics

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Dec 172012

France has jumped on the generics bandwagon. To preserve its comprehensive healthcare offerings, the government is making targeted cost cuts–and branded drugs are squarely in their sights. The opportunity for savings is significant. As Bloomberg reports, the French are suspicious of copycat meds; they choose generic drugs 71% of the time. By comparison, the U.S. generics utilization rate was about 78% last year, according to the Government Accountability Office. In Germany , that rate approaches 96%. France's goal is to boost generics use to 85%. New rules require patients to pay up front for a branded drug if a generic is available; they're reimbursed later, but they're out of pocket till then. Plus, the government is pressuring pharmacists who substitute generics less often. Meanwhile, of course, France has been slashing prices on branded meds–and generics, too. The drug spending cuts will save €530 million ($697.8 million) next year, officials have said. Other measures–including campaigns for “more reasonable prescription practices” among doctors–put last year's total savings at?€1 billion ($1.3 billion) last year, Bloomberg reports. Of course, savings for the government means costs for drugmakers. At a time when countries across Europe are slashing at drug budgets, France's cutbacks have cost drugmakers €1 billion ($1.3 billion) so far, industry groups say. And that doesn't include this year's push for generics. – read the Bloomberg story Special Report: Top 20 generic molecules worldwide Related Articles: France replaces drug regulator with new agency French market toughens up on drug prices, safety French minister overhauls pharma regs ?

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France herds patients, pharmacists toward cheap generics

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MSL WORLD BLOG

Drugstores push for access to secret PBM pricing-and-reimbursement info

Generics dampen US drug spending; payers fear rising specialty costs

Generics dampen US drug spending; payers fear rising specialty costs

Apotex, Waxman take sides against pharma in Supreme Court generics cases

Generic drugmakers concerned over FDA turmoil

Cipla shoots South Africa's Cipla Medpro a better offer

Fewer generics approved in 2012 but still a banner year

India may kill compulsory licensing based on price

FDA approves generic Doxil to combat drug shortage

France herds patients, pharmacists toward cheap generics

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