Tagged Prescription Drugs

GAO To Launch Investigation Of FDA’s Orphan Drug Program

Acting on a request from three influential U.S. senators, the government’s accountability arm confirmed that it will investigate potential abuses of the Orphan Drug Act.

The Government Accountability Office still must determine the full scope of what it will look into and the methodology to be used. Determining the scope will take some months, said Chuck Young, GAO’s managing director for public affairs.

Earlier this month, Sens. Orrin Hatch (R-Utah), Chuck Grassley (R-Iowa) and Tom Cotton (R-Ark.) sent a letter to the GAO and raised the possibility that regulatory or legislative changes might be needed “to preserve the intent of this vital law” that gives drugmakers lucrative incentives to develop drugs for rare diseases.

Grassley’s office said Tuesday they expected the GAO to begin its work in about nine months. The delay is typical as the agency has a queue of requests it is pursuing.

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The senators have asked the GAO to “investigate whether the ODA is still incentivizing product development for diseases with fewer than 200,000 affected individuals, as intended.”

Congress overwhelmingly passed the 1983 Orphan Drug Act to motivate pharmaceutical companies to develop drugs for people whose rare diseases had been ignored. Drugs approved as orphans are granted tax incentives and seven years of exclusive rights to market drugs that are needed by fewer than 200,000 patients in the U.S.

In recent months, reports of five- and six-figure annual price tags for orphan drugs have amplified long-simmering concerns about abuse of the law. The senators’ call for a GAO investigation reflects that sentiment.

“While few will argue against the importance of the development of these drugs, several recent press reports suggest that some pharmaceutical manufacturers might be taking advantage of the multiple designation allowance in the orphan drug approval process,” the letter states.

In January, Kaiser Health News published an investigation that found the orphan drug program is being manipulated by drugmakers to maximize profits and to protect niche markets for medicines being taken by millions.

That investigation, which also was published and aired by NPR, found that many drugs that now have orphan status aren’t entirely new. More than 70 were drugs first approved by the Food and Drug Administration for mass-market use. Those include cholesterol blockbuster Crestor, Abilify for psychiatric disorders and the rheumatoid arthritis drug Humira, the world’s best-selling drug.

Others are drugs that have received multiple exclusivity periods for two or more rare conditions.

The senators asked the GAO for a list of drugs approved or denied orphan status by the FDA. It also asked if resources at the FDA, which oversees the law, have “kept up with the number of requests” from drugmakers and whether there is consistency in the department’s reviews.

And they said it would be important to include patient experiences in the GAO review. The GAO does not provide updates on ongoing work but rather reports its findings once they complete an assignment.

The rare-disease drugs have become increasingly popular with pharmaceutical and biotech companies and are expected to comprise 21.4 percent of worldwide prescription sales by 2022, not including generics, according to consulting firm EvaluatePharma’s 2017 orphan drug report.

That’s in part because of the exorbitant prices that can be charged. Of the top 100 drugs in the U.S., the average cost per patient per year for an orphan drug was $140,443 in 2016, compared with $27,756 for a non-orphan, EvaluatePharma said.

KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

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$89,000 Orphan Drug Gets A New Owner — And Likely A New Price

Marathon Pharmaceuticals’ controversial $89,000-a-year drug that has drawn outrage from patients and intense questioning from Congress is getting a new owner.

After striking a deal Wednesday evening, PTC Therapeutics announced plans early Thursday to buy the Duchenne muscular dystrophy drug Emflaza from Marathon for $140 million in cash and stock. The drug’s new price was not announced.

While declining to answer questions about price, PTC Chief Executive Stuart Peltz built up the value of Emflaza, which is a steroid, in an investor conference call. Emflaza, he said, is an “important new drug” and “disease-modifying.”

On price, PTC believes “a change needs to be made, however it’s premature to speculate exactly what that will be,” Peltz said.

Emflaza was approved as an orphan drug with the Food and Drug Administration last month, and PTC executives said they expected it to treat 9,000 Duchenne patients in the U.S. The drug has been available outside the U.S. for decades under the generic name deflazacort.

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It is a steroid used to lessen the symptoms of Duchenne, a fatal muscle-wasting disease that affects mostly boys. For years, many American patients have imported the generic version at a cost averaging from $1,000 to $1,600 annually. The cost typically was not covered by insurers.

But the controversial price difference between the older generic and the newly approved drug has outraged patients and lawmakers.

“It’s just all insane,” said Dana Edwards, a New Jersey mother whose 12-year-old boy uses deflazacort, from overseas, to treat his Duchenne muscular dystrophy. Edwards said the generic costs her about $1,000 a year, and she worries that the PTC purchase will not affect Emflaza’s price.

“Honest to God, I think it’s going to have to remain pretty high,” Edwards said. “I pray to God that they do right by our community.”

Shortly after Marathon announced the price of Emflaza, Sen. Bernie Sanders (I-Vt.) and Rep. Elijah Cummings (D-Md.) sent a letter to the company demanding answers about pricing, saying the drug isn’t new. Marathon executives responded by delaying the drug’s market launch.

In early March, seven Democratic U.S. senators and one independent also demanded answers from the company in a letter that said they’re concerned that the price “exploits” patients. Marathon had responded by saying it was committed to ensuring that all patients had access to the drug.

Sanders and Cummings sent a letter to the FDA this week, asking about the approval process for Emflaza and saying that the price was “especially troubling” in light of the financial incentives Marathon received under the orphan drug approval process.

Those incentives include a seven-year market exclusivity for the drug as well as tax breaks on development and a waive in fees. Marathon also won a pediatric review voucher with its Emflaza approval. And the lawmakers’ letter zeroed in on the voucher program, which Congress approved in 2012 to encourage the development of drugs for rare pediatric disorders. Companies can keep the voucher to expedite the approval process for their next drug or sell it to another company. The vouchers have fetched prices of $350 million.

On Thursday, a Sanders aide confirmed that the lawmakers will continue examining the pricing and approval process for Emflaza.

Marathon executives declined interview requests. But the company sent a letter to the patient community stating that the deal will “create the opportunities needed” to make sure the greatest number of Duchenne patients could get the drug.

PTC’s Peltz, just as Marathon’s executives said last month, told investors that the company would reach out to the Duchenne community, physicians and payers. The company plans to disclose its price after the acquisition is finalized, which is expected by the end of June.

As part of the deal, Marathon will be entitled to payments based on Emflaza’s sales plus a one-time $50 million payment when the drug reaches an undisclosed sales-based milestone. In addition, Marathon executives will remain on the transition team to aid in the drug’s U.S. rollout.

PTC sees Emflaza as a first step into the U.S. Duchenne market, Peltz said. The company talked of pursuing a pediatric approval for the drug’s use.

PTC has another drug, Translarna, which received conditional approval for use in the European market to treat people with a specific mutation of Duchenne. The drug targets a different set of patients than those treated by Sarepta Therapuetics’ Exondys drug. It is currently being reviewed for use in the U.S.

Parent Project Muscular Dystrophy, a patient advocacy group, released a statement saying that PTC has a “long history” with the community. PPMD’s statement urged PTC to be “transparent about the methodology they will use when establishing their pricing.”

“The players may have changed,” PPMD said, but that doesn’t mean concerns about pricing have lessened.

KHN’s coverage of prescription drug development, costs and pricing is supported in part by the Laura and John Arnold Foundation.

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Sticker Shock Forces Thousands Of Cancer Patients To Skip Drugs, Skimp On Treatment

John Krahne received alarming news from his doctor last December. His brain tumors were stable, but his lung tumors had grown noticeably larger.

The doctor recommended a drug called Alecensa, which sells for more than $159,000 a year. Medicare would charge Krahne a $3,200 copay in December, then another $3,200 in January, as a new year of coverage kicked in.

For the first time since being diagnosed 10 years ago, Krahne, now 65, decided to delay filling his prescription, hoping that his cancer wouldn’t take advantage of the lapse and wreak further havoc on his body.

With new cancer drugs commonly priced at $100,000 a year or more, Krahne’s story is becoming increasingly common. Hundreds of thousands of cancer patients are delaying care, cutting their pills in half or skipping drug treatment entirely, a Kaiser Health News examination shows.

One-third of Medicare patients who were expected to use Gleevec — a lifesaving leukemia medication that costs up to $146,000 a year — failed to fill prescriptions within six months of diagnosis, according to a December study in the Journal of Clinical Oncology.

Researcher Stacie Dusetzina and her colleagues at the University of North Carolina found that patients with private health insurance with relatively high monthly copayments ($53 or more) were 70 percent more likely to stop taking Gleevec or take fewer doses than prescribed, according to a 2014 study.

Leukemia patients aren’t the only ones rationing care.

A 2013 study in The Oncologist found that 24 percent of all cancer patients chose not to fill a prescription due to cost, while about 20 percent filled only part of a prescription or took less than the prescribed amount. A February study published in Cancer had similar findings, with about 10 percent skipping medication or taking less than prescribed, and 14 percent delaying filling a prescription.

Given that more than 1.6 million Americans are likely to be diagnosed with cancer this year, that suggests 168,000 to 405,000 ration their own prescription use.

“Patients are being harmed daily” by high treatment costs, said Dr. Hagop Kantarjian, a leukemia specialist and professor at Houston’s MD Anderson Cancer Center. “It’s causing more deaths than necessary.”

Stopping drugs like Gleevec could be cutting years from some patients’ lives. Instead of dying in five to seven years, patients with chronic myeloid leukemia who take Gleevec and similar drugs can survive nearly as long as anyone else, and with a good quality of life, Kantarjian said.

Given that his lung cancer has grown slowly over the years, Krahne’s doctor thought it would be safe to wait until January to begin his new medication.

“We hope it doesn’t hurt my chance of cure,” said Krahne, from Santa Rosa, Calif. “It was an educated risk that we didn’t take lightly.”

Krahne made repeated calls to patient-assistance programs throughout January, trying to find help with his out-of-pocket costs.

“The anxiety during those days or weeks was probably almost as bad as the day I was diagnosed with cancer,” Krahne said.

Doctors have a term for Krahne’s problem: “financial toxicity.”

“We’re talking about huge numbers of patients,” said Dr. Scott Ramsey, director of the Hutchinson Institute for Cancer Outcomes Research at the Fred Hutchinson Cancer Center in Seattle. “It’s an epidemic. And it’s not going away.”

Even patients with good insurance can face a financial crisis when trying to pay for cancer therapy. Medicare pays for the bulk of cancer care in the United States because 59 percent of cancer patients are older than 65. And, although it covers a high percentage of the cost, copays for patients such as Krahne can easily reach $10,000 a year, Dusetzina said.

Krahne and his wife, Audrey, sit in their kitchen at home in Santa Rosa, Calif. “We hope it doesn’t hurt my chance of cure,” Krahne said of his decision to delay filling his prescription. “It was an educated risk that we didn’t take lightly.” (Robert Durell for Kaiser Health News)

Unlike many commercial plans, Medicare doesn’t set an upper limit on what patients pay out-of-pocket. Patients with chronic lymphocytic leukemia who begin oral medications this year, for example, can expect to have lifetime out-of-pocket costs of $57,000, according to a January study published in the Journal of Clinical Oncology.

High drug costs are a particular problem for the elderly, half of whom have $13,800 or less in available assets, and many have more than one expensive chronic condition, such as heart disease, diabetes or emphysema. The median income for people on Medicare was $24,150 in 2014, according to the Kaiser Family Foundation.

Medicare patients with cancer spend an average of 11 percent of their income on treatment, according to a November study in JAMA Oncology. Patients who don’t have supplemental insurance, which pays for treatment not covered by traditional Medicare, spend 23 percent of their income on cancer care. Ten percent of elderly patients without supplemental insurance spent 60 percent of their income on cancer expenses.

In John Krahne’s case, persistence finally paid off. After making repeated calls to patient-assistance programs in January, Alecensa’s manufacturer, Genentech, agreed to help pay Krahne’s out-of-pocket costs. He began taking the drug Jan. 27, six weeks after it was first prescribed.

It’s impossible to know whether Krahne’s health will be affected by the delay, said Ramsey.

“Most oncologists are OK with delays of up to a month, but after that they start getting anxious that further delays will harm chances for survival,” Ramsey said.

When thinking about having to find the money for more than $10,000 in cancer treatment a year, Krahne said: “Hopefully, I won’t have to do this year after year.”

Yet Krahne acknowledged that paying high prices is the cost of surviving cancer today. “So, hopefully, I will have to do this year after year.”

Big-Ticket Designer Drugs

While cancer has always posed a financial hardship for patients, the jaw-dropping costs of new cancer medications have led to widespread criticism of the pharmaceutical industry, on Capitol Hill and beyond.

List prices for oral cancer drugs doubled from 2011 to 2016, rising from an average of $20 for a day’s supply to $40, according to Express Scripts, a pharmacy benefit manager. Six of the 39 cancer drugs on the market in 2010 doubled or tripled in price by 2016; one quadrupled in price; one drug’s price increased eightfold.

Treating melanoma patients with the highest dose of Keytruda, an immune therapy that has led to long-term remissions in some patients, could cost more than $1 million a year.

Such costs are leading to soul-searching by doctors, who often struggle to help patients decide if drugs are worth the consequence of depleting their life savings, or going into debt or even bankruptcy.

“My job is to prescribe the best treatment,” said Dr. Yousuf Zafar, associate professor of medicine and public policy at the Duke Cancer Institute in North Carolina. “But I’m not doing my job if I prescribe a drug and walk away and leave them with tens of thousands of dollars in immediate debt.”

In a statement, the Pharmaceutical Research and Manufacturers of America, an industry group, noted that drug costs are only one part of the problem. “Many factors contribute to financial hardship for cancer patients … physician services, transportation expenses, and the inability to work, among other medical and non-medical factors, drive the cost burden on patients. We have also seen a rapid rise in the number of health plans with high deductibles for medicines.”

In a statement, officials at Gleevec’s manufacturer, Novartis, noted that the company provided financial aid to 130,000 patients last year, including those struggling to pay for Gleevec.

“We price our medicines to reflect the value they bring to patients and society,” said Novartis spokesman Eric Althoff. “We also continue to invest in new treatments so that we can find ways to make more cancers survivable.”

Patients Go For Broke

The high cost of cancer medications can burden patients for years even after they finish treatment.

Liza Bernstein, 52, was diagnosed with breast cancer three times from 1994 to 2009. She emptied her savings account after her second diagnosis and gave up her apartment because she couldn’t pay her rent. Bernstein sold some belongings and put the rest in storage, where they remain. She has been living with friends and relatives ever since.

“People say ‘Call this foundation or that foundation,’” for help, said Bernstein, a freelance designer and patient advocate in Los Angeles who was unable to work for several years due to her illness. People don’t understand “the cognitive and emotional exhaustion of trying to manage this and wrap your brain around everything you need to do.”

Cancer often limits patients’ ability to hold down a job. Four years after diagnosis, one-third of previously employed breast cancer survivors were unemployed, according to a 2014 study. Patients who lose a job don’t just lose a paycheck; they often lose their health insurance.

Liza Bernstein (Courtesy of Christopher Kern)

In a 2012 study of 284 colorectal cancer patients, 38 percent reported one or more financial hardships as a result of treatment, such as being forced to sell or refinance their home or losing more than 20 percent of their income, even though nearly everyone in the study was insured. Seventeen percent borrowed money from family or friends, at an average of more than $14,000.

Twenty-three percent were in debt 20 months after their diagnosis, with an average debt of $26,860, according to the study. Even patients without severe hardship saw their fortunes change due to cancer, as they sold stocks and drew on savings.

About 3 percent of patients with cancer declare bankruptcy, said Ramsey, whose 2013 study found cancer patients are 2.7 times more likely to file for bankruptcy than those who’ve never been diagnosed.

Although Bernstein considered declaring bankruptcy, she said she couldn’t afford the $500 to $600 it would have cost for a lawyer and filing fees.

Bankruptcy isn’t just financially devastating.

Mortality rates among cancer patients who filed for bankruptcy are, on average, 79 percent higher than those of other patients, according to Ramsey’s 2016 study in the Journal of Clinical Oncology. Bankruptcy is associated with an especially high risk of death for certain cancers. For example, mortality rates are 2.5 times higher among patients with colorectal cancer who filed for bankruptcy compared with patients who didn’t file.

The financial stress takes a toll on survivors as well. A study published last year in the Journal of Clinical Oncology found that patients with more financial strain had worse overall health and more pain, depression and impairment compared with those with more resources.

Financially stressed patients may skip pain medications and miss doctor’s appointments. And those who skip taking drugs to relieve nausea and vomiting, Ramsey said, can die from dehydration.

Krahne, right, and his friend Don Stranathan, who also has lung cancer, walk near Krahne’s home. The cancer drug Krahne was prescribed sells for more than $159,000 a year. (Robert Durell for Kaiser Health News)

A 2011 study found that breast cancer patients who stopped taking hormonal therapy earlier than scheduled, or who took less than the prescribed amount, were more likely to die.

Some patients “have to choose between paying their meds and heating their home,” said Carla Tardif, chief executive officer at Family Reach, a New Jersey charity that provides financial aid to families dealing with cancer. “I went into a home and there were two sleeping bags on the kitchen floor. The mom said, ‘We sleep by the stove because I can’t afford the heat.’”

Molly MacDonald (Courtesy of The Pink Fund)

Molly MacDonald, who was diagnosed with breast cancer at age 54, when she was a divorced single mother of five, opted not to undergo reconstructive surgery because of the cost. She worried about the increased risk of infection and hospitalization, which she knew she could not afford.

“All of my decisions were based on cost,” said MacDonald, of Beverly Hills, Mich. “We sold things. I cut the kids’ hair myself. Friends brought food. Then I found myself in line at the food bank. I used to have groceries delivered. It was interesting to find out how quickly someone can find themselves in a place of need.”

In October 2006, after MacDonald got back on her feet, she began soliciting donations for a nonprofit she created called The Pink Fund, which helps to pay breast cancer patients’ bills. The fund now pays about $65,000 in bills a month. “We’ve helped people who are living in storage units, living with their families, living in cars.”

MacDonald often draws from her experience when offering financial advice. Consider selling your house to prevent it from being taken away, she suggests. Remember, that as bad as the situation is, it’s not permanent. But she also asks clients, “What in your house can you sell?”

KHN’s coverage related to aging & improving care of older adults is supported by The John A. Hartford Foundation and coverage of end-of-life and serious illness issues is supported by The Gordon and Betty Moore Foundation.

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