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Pharma execs discuss drug pricing at JPM2020
Posted on January 27th, 2020 by Xuanyan Xu in Pharma R&D
I’ve found lately that drug and treatment pricing pressure is an absolutely unavoidable topic in the industry. It has been highlighted even more recently due to the fact that this pressing issue is often mentioned by the candidates currently running for president in our upcoming election here in the United States. Knowing how important healthcare costs are to many Americans, most of the presidential hopefuls have been promising that they will use the government to bring down prices if they are elected.
The recently-concluded J.P. Morgan Healthcare Conference (read my other piece on this year’s JPM conference here) recognized the issue with a panel on drug pricing reform, where Roche CEO Bill Anderson and Bristol-Myers Squibb CEO Giovanni Caforio focused on the need for rebate reform. According to Jessica Merrill of Informa Pharma Intelligence’s Pink Sheet, Caforio said, “The real issue is that the rebates are not used to lower the exposure of patients to the cost of care. The rebates are used primarily to reduce the monthly cost of healthy individuals.”
Alaric Dearment of MedCityNews also noted that the panelists talked about ideas such as outcomes-based contracts and the possibility of pricing drugs differently based on indication and when they’re combined with other therapies.
Talk of drug prices permeated the conference well beyond the panel discussion. As Berkeley Lovelace Jr. reported for CNBC, Regeneron CEO Leonard Schleifer suggested improving Medicare by adding an out-of-pocket maximum for beneficiaries. Meanwhile, Lovelace Jr. noted, “Pfizer CEO Albert Bourla, supported passing rebates paid to pharmacy benefit managers through to consumers, arguing the current system drove up list prices and out-of-pocket costs.”
In a one-on-one chat with Chris Schott, Eli Lilly and Company CEO Dave Ricks answered a question about patient affordability by mostly chalking the problem up to insurance companies not offering good enough benefits and suggesting the need for insurance reform. However, he said that in the meantime manufacturers had to think of their own solutions. “We have also undertaken steps to fill the gaps where people really don’t have insurance, indigent care programs,” he said, mentioning programs they have that reduce co-pays or offer free insulin to those who qualify.
While executives from the larger pharmas and biotechs were offering their thoughts on the problem and musing on how it might be possible to bring high drug prices down, new kid in town EQRx – launched by Alexis Borisy – drew attention at the conference by announcing the company’s intention to generate cheaper medicines. “Their plan,” explained Science Translational Medicine blog, “is apparently to come up with new competing pharmaceuticals in existing categories and sell them for lower prices than the patented ones.”
Is it possible? Apparently Borisy thinks so. While just about everyone else in the industry may be skeptical, there is no question that affordability in drug pricing is a pressing challenge that we must confront. The political pressure is rising, and it will only get louder as we get closer to the November election.
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