Pharma’s Defeat In Doughnut Hole Battle Possible Harbinger Of Things To Come For Powerful Industry
Despite an intense lobbying push, drugmakers weren't able to convince lawmakers to let them off the hook for beneficiaries that fall into the doughnut hole, raising questions about the industry's current clout. Meanwhile, a drug distributor has been accused of illegally pooling leftover cancer medications to sell to providers; Norvatis is buying gene-therapy company AveXis; a powerful pharmaceutical company dabbles in vineyards; and more.
Bloomberg:
A Rare Loss For U.S. Pharma Lobby Will Cost The Industry Billions
Deep in a budget deal Congress passed earlier this year -- just 118 words in Section 53116, a little before passages on prison reporting data and payment yields for seed cotton -- was a hit to pharmaceutical companies that will cost them billions, and could signal more losses to come. Despite an intense lobbying push, lawmakers changed a Medicare rule, putting manufacturers on the hook for more of seniors’ prescription costs. The companies will have to offer a much more generous discount to beneficiaries who fall into the so-called donut hole coverage gap, marking down retail costs by 70 percent instead of the current 50 percent. (Edney, 4/6)
The Washington Post:
Largest U.S. Drug Distributor Accused Of Illegally Handling Cancer Medication
The nation’s largest drug distributor is being accused of illegally pooling leftover cancer medication from single-dose vials and selling it to health-care providers, who treated patients with it and often billed government programs for reimbursement. A lawsuit unsealed Wednesday in New York seeks unspecified damages from McKesson Corp., the fifth-largest U.S. public corporation of any kind. (Bernstein, 4/6)
The Wall Street Journal:
Novartis Bets $8.7 Billion On Gene-Therapy Company
Novartis AG agreed to buy U.S.-based gene-therapy company AveXis Inc. for $8.7 billion, marking the first big bet by the Swiss pharmaceutical giant’s new chief as he looks to the deal table to refresh his drug-development pipeline. Novartis said Monday it will pay $218 for each share in Illinois-based AveXis, an 88% premium to its closing price on April 6. Earlier this year, Novartis Chief Executive Vasant Narasimhan agreed to cash out of its consumer health joint venture with GlaxoSmithKline PLC—a deal that gives him cash for what he describes as “bolt on” deals to replenish Novartis’ drug pipeline, his key focus since taking the reins earlier this year. (Delclaux, 4/9)
Bloomberg:
Novartis Chief Spurs Rare-Disease Shift With $8.7 Billion Deal
Novartis AG agreed to acquire AveXis Inc. for $8.7 billion to gain a promising drug to treat a rare disease that afflicts infants, hastening a shift toward gene therapy and precision medicines. Shareholders of the Bannockburn, Illinois-based company will receive $218 a share in cash in a tender offer, Novartis said in a statement Monday. The price is 88 percent above where AveXis closed Friday. (Krege and Serafino, 4/9)
Stat:
The Strange Story Of A Pharma Company's Silicon Valley Winery
The Japanese drug maker Otsuka markets chemotherapies for leukemia, antidepressants for schizophrenia, and a pill that can alert your doctor when you swallow it. It also grows grapes and sells cabernet sauvignon. ...Otsuka bought Ridge Vineyards in 1986 — the main explanation seems to be that the drug maker’s chairman at the time loved a good Bordeaux — and has held onto the investment ever since. (Robbins, 4/9)
Stat:
New York Panel To Review Vertex Pricing In First Test Of New Law
For the first time, a New York state panel will review a prescription drug over concerns it may cause the state Medicaid program to exceed a cap on drug spending. Such reviews were greenlighted under a law passed last year in a bid to control rising prices for medicines. At issue is a cystic fibrosis drug called Orkambi, which is sold by Vertex Pharmaceuticals (VRTX). A drug utilization review board is scheduled to meet on April 26 and, depending upon the outcome, could recommend a supplemental rebate to lower the cost to the program. (Silverman, 4/6)
Stat:
Should Bristol-Myers Panic Over Incyte’s Skin Cancer Failure?
The failed skin cancer trial that crushed Incyte and Merck on Friday could be cause for alarm over at Bristol-Myers Squibb, which is running a nearly identical study with two drugs of its own that work the same way. Like Incyte (INCY) and Merck (MRK), Bristol-Myers (BMY) is testing a two-drug combination that pairs a blockbuster immunotherapy with an unapproved pill that might make the older drug more effective. For Bristol-Myers, that pill is called BMS-986205, and it works by targeting an enzyme called IDO, which plays a role in helping tumors evade the immune system’s detection. (Garde, 4/6)