| Happy Monday, readers! Remember when August was a slow, plodding month? Neither does anyone else. This was another week for big deals and tackling the industry’s biggest questions. Dive into the dog days with us in this edition of The Week That Was…
 Read on for more of The Week That Was… |
| ►CRUEL SUMMER FOR PBMS CONTINUE? Watch out PBMs, big pharma and the Administration are coming for you. This week continued the trend of Pharmacy Benefit Managers (PBMs) being flogged for driving up the prices of drugs. The New York Times ran an overview of PBMs, including how their rebates influence drug prices and the increasing political scrutiny they are receiving. The Times explains that PBMs use rebates to determine formulary status of medicines, yet the rebates (or savings from the manufacturers), are often not passed down to the consumer. The Administration is also pushing to make it illegal for rebates to be paid to PBMs under the Medicare Part D program. Meanwhile, Pfizer CEO Ian Read spoke openly about a future industry without rebates. ►OUR TAKE The pricing conversation has moved – at least temporarily – from pricing pledges and freezes to “taking on the middle men.” But life science companies should still be cautious. Blaming pharma is still much easier than explaining and then blaming a PBM. Few Americans understand the role of PBMs and this is a public education effort best undertaken by trade associations, think tanks and elected officials who see the middlemen as a major factor for high list prices. Individual companies with breakthrough medicines should continue to focus on communicating the value your therapy delivers. |
►STATE REGULATORS TRY TO STEAL SUNSHINE FROM CVS-AETNA MERGER California Insurance Commissioner Dave Jones is urging the U.S. Department of Justice to block the proposed merger between payers Aetna and CVS. California’s commissioner cites fears over less competition in Medicare and other marketplaces, and argues the merger could lead to higher drug prices and compromise the quality of care. The move comes as the DOJ is investigating the potential merger. It also echoes a public call-to-action made by the American Medical Association (AMA) for regulators to oppose the merger. ►OUR TAKE In response to California’s recommendation, CVS pushed back against the commissioner’s comments, claiming that the merger would benefit consumers through potential $0 copays and reduced cost sharing. Reducing costs is effective messaging for patients and works well in consumer-facing media. Will it influence the DOJ’s decision making? Probably not. BUT it will provide some political cover to the Administration if they choose to oppose the AMA and state regulators in letting the deal go through. |
| ►COMPANY "RIGHT TO TRY" MATCHING HAS HAZY IMPLICATIONS A San Diego company, Batu Biologics has filed a patent to match cancer patients with experimental oncology treatments under the auspices of the recently-passed Right to Try law. The company would charge patients for: 1) offering a liquid biopsy (which itself is not FDA approved), 2) identifying which experimental treatment may be the best match for the patient and 3) to serving as the middle man to access and administer experimental drugs. The business move was criticized by bioethicists, arguing Batu’s communications may give unfounded hope to sick patients – and that the “liquid biopsy” must undergo clinical trials before it should be used. ►OUR TAKE Batu is just the latest company to try to create a potential revenue stream using Right to Try (RTT), but it promulgates a thicket of ethical questions created by the well-meaning law. Utilizing an experimental test to ID experimental treatments is exactly the type of concern RTT opponents cited when the law was under debate. Many ethicists claimed some bad actors would try to sell dying patients false hope (or junk science). How to proceed? First, biopharmaceutical companies must comply with the law and post an expanded access policy posted to a website. Second, it’s also advisable for companies to anticipate the common misunderstandings that patients and doctors may have when they first approach a company asking to access investigational drugs. If you’re a biopharma without a protocol for addressing such requests for your un-approved drugs, we’d get working on that STAT. |
| Until next week, people. - The Reputation & Risk Management Practice @Syneos Health Communications |
