Some Companies Cancel, Reduce Planned Price Hikes Amid Continued Pressure Over US Drug Costs: Report

Source: FirstWord

Novartis, Gilead Sciences, Roche, and Novo Nordisk have advised California health plans in recent weeks that the companies are rescinding or reducing previously announced price increases on at least 10 drugs, Bloomberg reported Tuesday. The moves come after California introduced legislation earlier this year that obliges drugmakers to give insurers, governments and drug purchasers at least 60 days’ notice of price increases of more than 16 percent during a 2-year period.

The law is being challenged by the Pharmaceutical Research and Manufacturers of America (PhRMA), which has called it “unprecedented and unconstitutional” in part because it “singles out drug manufacturers as the sole determinant of drug costs despite the significant role many other entities play in the costs patients pay.”

Citing a health plan official who spoke on condition of anonymity, Bloomberg said the changes affect various products, including Novartis’ psoriasis drug Cosentyx (secukinumab) and its heart failure treatment Entresto (sacubitril/valsartan), as well as Gilead’s pulmonary hypertension therapy Letairis (ambrisentan) and Ranexa (ranolazine) for angina.

Novartis spokesman Eric Althoff stated “many factors influence our decisions to change product prices for our US portfolio and it is not uncommon for us to adjust plans for price changes.” Meanwhile, Roche confirmed that it has withdrawn plans to raise the price of its thrombolytic Cathflo Activase (alteplase) by 4 percent, but is keeping recent hikes of 3 percent and 2.5 percent, respectively, on Herceptin (trastuzumab) and Avastin (bevacizumab) after having already raised the prices of both drugs in January. A spokesperson for the Swiss drugmaker explained that the increases were small enough that Roche was not required to send a notification.

Commenting on the news, SSR analyst Richard Evans argued that the California legislation is unlikely to affect the overall pace of price increases. “If what you are trying to do is limit price inflation, this is not the way to go about it,” Evans stated, continuing “this is not going to change mainstream list price behaviour at all.”

The news comes after US President Donald Trump outlined a blueprint in May aiming to curb prescription drug prices, in part by increasing competition. Trump, who also recently suggested that drugmakers were set to announce “voluntary massive” price cuts on their products, singled out Pfizer for criticism earlier this week after the company reportedly raised the US prices on 100 of its products as of July.

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