ICER Weekly View 02-16-18

From the desk of Mitchell Stein


Good morning. Calling this a busy time for drug news would be like calling Mount Everest a little hill. Following last week’s budget deal, we had a Council on Economic Advisors drug price report and the Administration’s proposed budget. We also had several large deals, three Alzheimer’s drug failures, and new CRISPR advances, and more! It makes my head spin just summarizing… You’ll find today’s Inside the Beltway section extra large as I try and keep up with Washington developments. Here’s this week’s full rundown:

ICER in the news – Final report on Voretigene and Evidence Report on CAR-T therapies

Inside the Beltway – Administration’s budget, CEA drug price report (multiple articles), and in Oregon industry campaign to defeat legislation

Industry Trends – CMS Office of the Actuary health expenditure projections, NIH funding impact on approved drugs, Sovaldi’s influence on pricing, new CRISPR science, a survey on right-to-try legislation, and antibiotic news (2 stories)

Company/Drug Specific – Bristol-Myers, Roche, Walgreens, Amazon, Vertex, and Janssen

Weekly View In-depth – Alzheimer’s

Now, on to the news.

ICER In The News

ICER released a Final Evidence Report and Report-at-a-Glance on voretigene neparvovec (VN; Luxturna™, Spark Therapeutics) for treatment of vision loss associated with RPE65-mediated retinal disease. Approved in 2017, VN is the first treatment for this condition. The appraisal committee vote reveals differences in judgments on value given pricing far above traditional cost-effectiveness levels. The policy recommendations call attention to the growing stream of treatments for rare disorders that cannot all be priced at similar levels without threatening the financial sustainability of the health system.

If you’re not yet familiar with ICER’s Report-at-a-Glance publications, this topic is a great place to start. If you don’t have time to read the 105-page full report, ICER has you covered with a six-page Report-at-a-Glance where you’ll find summaries of the key aspects of the report, including the policy recommendations, the economic analysis, and more.

Institute for Clinical and Economic Review Final Report: Broader Benefits of Voretigene Neparvovec to Affected Individuals and Society Provide Reasonable Long-Term Value Despite High Price


ICER released an Evidence Report assessing the comparative clinical effectiveness and value of tisagenlecleucel (KymriahTM, Novartis) and axicabtagene ciloleucel (YescartaTM, Kite Pharma/Gilead). The report found that both therapies provided improvements in response rates and survival for patients who have exhausted most other treatment options, and that the drugs are priced in alignment with their clinical value.

Institute for Clinical and Economic Review Report Finds Costs of Approved CAR-T Therapies Align with Clinical Benefit

More coverage of Kymriah’s price with mention of ICER’s work on the topic.

Kymriah cost dispute goes to heart of pharma’s pricing row

A peer-reviewed journal of health policy thought and research has published an article claiming that the US price tag of the pioneering CAR-T therapy Kymriah (t

Pharmaceutical News

Inside the Beltway/State Regulatory Developments

In the past week, we’ve seen a budget deal, the release of the Administration’s budget, and a drug pricing report. Given the rapid developments in Washington, the Administration’s budget, which had been in the works for months, did not completely align with the deal reached just days before its release. I know I find all this confusing, so in case you do as well, let’s review before we get to the coverage: Last Thursday Congress passed a budget deal that outlined certain changes in spending including an increase in domestic spending. This deal is now law, and barring passage of new legislation, it will be implemented. Then on Friday, the President’s Council of Economic Advisers (CEA) released a drug pricing report. Finally, on Monday of this week, the Administration released the proposed budget for the next fiscal year. It is worth noting that while the proposed budget and the CEA report are useful for understanding the Administration’s goals, they are aspirational documents and it is uncertain that all the goals requiring legislative implementation will move forward. With that in mind, let’s look at the specifics as they relate to our area of interest.

The good, the bad and the ugly – Axios summarizes the impact of last week’s budget deal on pharma.

Pharma’s week of whiplash

The pharmaceutical industry was busy last week, winning a key exclusion in the budget bill while getting handed a separate loss. And now as the White House releases its budget promoting drug pricing reforms – and as Alex Azar heads to the Hill to discuss them – pharma is still going to find itself on defense.

Bloomberg looks at the CEA report (overall a better document for the pharmaceutical industry). “The 30-page report circulated by the president’s Council of Economic Advisers blames high drug prices on foreign governments, as well as U.S. regulations, hospitals, middlemen known as pharmacy-benefit managers and high costs of innovation — basically everyone but the drugmakers themselves. ” (Note that unlike other proposals in the paper and the President’s budget, changing the way rebates are handled in Part D can be done without congressional approval.)

Drugmakers Dodge Another Bullet in Trump’s Drug Pricing Report

A White House report on drug pricing is another sign pharmaceutical companies can rest easy: President Donald Trump won’t act on past threats to take drastic measures to lower prices. The 30-page report circulated by the president’s Council of Economic Advisers blames high drug prices on foreign governments, as well as U.S.

The Kaiser Family Foundation summarizes the changes to Medicare drug coverage in both the budget deal and the proposed budget.

Summary of Recent and Proposed Changes to Medicare Prescription Drug Coverage and Reimbursement

On February 9, 2018 the President signed into law the Bipartisan Budget Act of 2018 (BBA of 2018), which included some provisions related to Medicare Part D prescription drug coverage. Just days later, on February 12, the Office of Management and Budget (OMB) released the President’s fiscal year (FY) 2019 budget, which also included several proposals related to Medicare Part D drug coverage and Part B drug reimbursement.

Here are three analyses of the changes and suggested changes. First a Health Affairs blog from Weekly View favorite Rachel Sachs: Budget, White Paper Provide Insight Into Trump Administration’s Strategy On Drug Pricing. Next a piece from Kaiser Health news: Trump’s Budget Proposal Swings At Drug Prices With A Glancing Blow. And finally, from STAT: Analysis: Trump budget tries to address drug prices, but leaves list prices untouched.

The new Secretary of HHS talks to Congress about the proposals included in the Administration’s budget.

Azar defends Trump drug pricing proposals, pushing back against criticism

ASHINGTON – Alex Azar defended the drug pricing proposals in the Trump administration’s latest budget request Thursday, pushing back on criticism that none of the ideas would lower the list prices for prescription drugs. The new health and human services secretary, when pressed on the matter by both a Democratic and a Republican senator at a budget hearing, pointed to two concrete proposals by the administration.

While the budget deal is now law, pharma still hopes to be able to roll back some of the Part D changes as part of upcoming legislation.

Pharma unleashes lobbying power to fight surprising-and costly-changes to Medicare Part D

Pharma only recently suffered in Congress’ shutdown-averting spending deal, which put the industry on the hook for bigger discounts in the Medicare Part D coverage gap, but its advocates in Washington are acting fast to try to reverse the damage, according to The Hill.

FDA Commissioner Gottlieb lays out his goals for the FDA.

FDA Head Vows To Tackle High Drug Prices And Drugmakers ‘Gaming The System’

Food and Drug Administration Commissioner Scott Gottlieb said he will do everything “within my lane” to combat high drug prices and that he sees drug companies “gaming the system to try to block competition” in a multitude of ways in the marketplace.

Moving away from budgets and white papers, here is the NY Times with a very positive profile of FDA Commissioner Gottlieb.

F.D.A. Chief Goes Against the Administration Stereotype

“He doesn’t want to blow up the agency,” said Mark I. Schwartz, a Washington lawyer who worked at the F.D.A. in Republican and Democratic administrations. Dr. Gottlieb has briefed Mr. Trump several times on agency issues, like opioids and generic drugs.

Reports of industry trying to sway Oregon legislators without revealing the source of their funding.

Documents reveal subversive campaign to defeat legislation

Industry Trends

The Centers for Medicare and Medicaid Services (CMS) Office of the Actuary released their annual National Health Expenditure Projections. The slow medical cost growth experienced recently is not expected to last. Prescription drug spending is forecast to grow at 6.3 percent per year, on average, between 2017 to 2026.

U.S. spending on drugs will grow faster than on other health-care services over the next decade

In case anyone had doubts about the value of the national investment in drug research.

NIH funding contributed to 210 approved drugs in recent years, study says

new study makes a strong case for the importance of government support for basic research: Federally funded studies contributed to the science that underlies every one of the 210 new drugs approved between 2010 and 2016. Researchers at Bentley University scoured millions of research papers for mentions of those 210 new molecular entities, or NMEs, as well as studies on their molecular targets.

A look at the influence of Sovaldi pricing on today’s strategy for pricing cures.

What Gilead taught pharma about pricing a cure

Debate over about ‘how to price a cure’ entered the pharma industry lexicon when Gilead Sciences Inc. priced its highly effective hepatitis C drug Sovaldi (sofosbuvir) at $84,000 per treatment course. The uproar has died down a bit and there’s now much less debate about whether Sovaldi was actually cost effective.

CRISPR science continues to advance at a breakneck pace.

With new CRISPR inventions, its pioneers say, you ain’t seen nothin’ yet

o one would be surprised if scientists announced tomorrow that CRISPR had leapt tall test tubes in a single bound, but until that happens, fans of the superhero genome-editing system will have to be content with a trio of almost-as-flashy (but potentially more useful) new tricks, all unveiled on Thursday.

EndPoints surveyed their readers about the push for a national right-to-try bill.

What does biotech think about ‘right-to-try’? It might surprise you

“Right-to-try” has made its way back to the headlines, filling our Twitter feeds with opinions on whether the House should reject or embrace a bill that would allow patients access to unapproved therapies. We know what politicians think, and what the public thinks. What does biotech think?

Sometimes in science, you have to get dirty – but the work could be a lifesaver.

A potentially powerful new antibiotic is discovered in dirt

And here’s one example of why a new class of antibiotics could prove so helpful – the existing classes continue to fail.

Tetraphase’s antibiotic fails late-stage study, shares plummet

Tetraphase Pharmaceuticals Inc said on Tuesday its lead experimental antibiotic to treat serious infections did not meet the main goals in a late-stage study, sending its shares plunging more than 60 percent in after-market trading.

Company/Drug Specific

Bristol-Myers pays a premium to lock up rights on a potential combo therapy partner for both Opdivo and Yervoy.

Bristol, needing a cancer immunotherapy boost, pays shockingly steep price for Nektar drug

ristol-Myers Squibb, seeking a new way to make its cancer immunotherapies more effective, is paying a shockingly steep – some will say desperate – price to lock up rights to an experimental drug from Nektar Therapeutics.

Roche goes from a 12% owner in Flatiron to buying the whole company. Flatiron is trying to use big data in big ways.

Roche To Buy Big Data Upstart Flatiron Health For $1.9 Billion

Roche, the Swiss drug giant, will buy New York-based Flatiron Health, which has become a leader in applying big data approaches to medicine, for $1.9 billion. Roche already owned a 12% stake in Flatiron; in total the deal values Flatiron at $2.1 billion.

Walgreens considers the vertical integration game.

Walgreens weighs buying drug distributor AmerisourceBergen

First Published on Walgreens is reportedly in talks to buy drug distributor AmerisourceBergen, according to the Wall Street Journal. Walgreens already owns 26% of the distributor and has a representative on Amerisource’s board. Amerisource is one of the largest drug distributors in the U.S., with a market value of $19.6 billion, and Walgreens is the largest drugstore chain in the world, with 13,000 stores in 11 countries.

Some actual Amazon news (as opposed to the usual speculation).

Amazon reportedly venturing into healthcare supplies, targeting hospitals and clinics

Amazon is expanding its reach in the healthcare supply market, according to a report by the Wall Street Journal. Hospital executives told the newspaper that Amazon has been working to expand its healthcare offerings on Amazon Business, the company’s business supply division.

Vertex receives FDA approval for Symdeko. This is one of the drugs being reviewed by ICER for the upcoming cystic fibrosis report and meeting.

On a roll, Vertex grabs FDA OK for CF double shot Symdeko – prices at $292,000

Close on the heels of its impressive data on new triple combos for cystic fibrosis, Vertex reported out today that the FDA has approved its double using tezacaftor/ivacaftor. In a drive to continually expand on its revenue, Vertex announced that it will price the combo at $292,000 a year, putting

The FDA approved Janssen’s prostate cancer drug Erleada.

FDA Approves First Treatment for Non-Metastatic, Castration-Resistant Prostate Cancer

Posted 14 February 2018 | By Zachary Brennan The US Food and Drug Administration (FDA) on Wednesday approved Janssen’s Erleada (apalutamide), which is the first treatment approved for patients with prostate cancer that has not spread (non-metastatic), but that continues to grow despite treatment with hormone therapy (castration-resistant).

Weekly View In-depth


This week saw three (!!!) Alzheimer’s drug failures. At the same time, the FDA released draft guidance: “Early Alzheimer’s Disease: Developing Drugs for Treatment Guidance for Industry,” where they talk about accelerated approval based on biomarkers, not clinical signs. Given the state of Alzheimer’s research, this troubles some observers as it is unclear if there are any biomarkers that could be used that have a sufficient evidence base to assure a connection to clinical improvement. The draft guidance was one of five released this week; you can read more about them here: Draft and Final FDA Guidances Detail Development of New Drugs for Neurological Disorders.

We’ll start with a look at the guidance, then articles on each of the three failures.

FDA Opens New Path for Alzheimer’s Treatments

The U.S. Food and Drug Administration said that it’s willing to approve Alzheimer’s drugs that show an effect on biological signals of the disease instead of clinical ones, a new path that could lead to treatments years before patients show symptoms like memory loss and dementia.

Scientists toss another Alzheimer’s program into the scrap heap as PhII fails

While a legion of scientists have been employed in failed attempts to clear away the toxic tangles of proteins often found in the brains of Alzheimer’s patients, another set have continued to plug away at the various chemicals that play a role in orchestrating the brain’s complex cellular communications system.

Merck just dashed the last remaining hopes for its industry-leading BACE drug for Alzheimer’s

The Alzheimer’s field is keeping its perfect record for failure in pivotal Phase III studies. Merck today scrapped the last remaining Phase III study of its leading BACE therapy verubecestat, the second of two collapsed studies, after independent monitors concluded that the drug wasn’t working for early-stage, prodromal patients.

Biogen shares fall after unexpected ‘variability’ in Alzheimer’s studies

Biogen Inc. spooked investors Wednesday with news it would increase enrollment into two Phase 3 studies testing the biotech’s all-important Alzheimer’s disease candidate aducanumab due to “variability” on the primary endpoint. Shares in Biogen slid in value by about 6.6% on the update, which was disclosed during a conversation with the company’s Chief Medical Officer Al Sandrock at a conference hosted by the investment bank Leerink Partners LLC.


@mhstein  |

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