Payers who’ve balked at a new class of cholesterol meds now have more justification. A new study concluded that Amgen, Sanofi and Regeneron would have to slash their prices by more than two-thirds to make them worth the cost.
Amgen’s Repatha and Sanofi and Regneron’s Praluent are both sticker-priced higher than $14,000 per year. This isn’t the first cost-effectiveness analysis to come up against the two meds, either.
But this study comes from the Journal of the American Medical Association, rather than a controversial U.S. analytics firm or a famously cost-conscious set of gatekeepers in England. It’s authored by academic researchers rather than payers with an obvious vested interest. And its conclusions are strikingly similar to previous assessments.
Researchers found that using the new PCSK9 meds, rather than Merck & Co.’s ezetimibe, another non-statin cholesterol fighter, would save $29 billion on care for cardiovascular complications over 5 years. But the cost of those drugs would run an estimated $120 billion, they concluded. Both numbers assume that all eligible patients would use the drugs, based on their two FDA-approved indications.
“Reducing annual drug costs to $4,536 per patient or less would be needed for PCSK9 inhibitors to be cost-effective,” the study states.
The assumptions about widespread treatment with PCSK9s--and the immense sales that would result--don’t square with analyst estimates for the PCSK9 class, however. Together, Praluent and Repatha are expected to generate $4.45 billion in annual sales by 2020. Multiply that by 5 years of use, and that’s not even $25 billion.
Payers have been kicking back at the PCSK9 meds’ potential load to their budgets since before they were approved last year. CVS Health CMO Troyen Brennan co-authored a study suggesting that Praluent and Repatha would put a $150 billion burden on the U.S. healthcare system if all eligible patients took the injectable meds.
The drugmakers have taken issue with those analyses, partly for their assumptions that a broad group of patients would be put on the drugs--which creates an overly rosy projection for drug sales, and an overly pessimistic estimate of their costs. They also note that the JAMA analysis is based on sticker prices, which don't include agreed-upon rebates.
"Compared to other economic analyses, this paper appears to focus on a population at 3-4 times lower risk of CV events, uses list prices rather than the prices actually negotiated with payers after rebates and discounts, and inflates the cost estimates," Amgen SVP Raymond Jordan told FiercePharma via email. "In addition, the model over-estimates the number of patients who will receive PCSK9 inhibitors, intended for use in high-risk patients who have exhausted all other options."
Payers’ prior authorization hurdles are already restricting uptake; up to three-fourths of scripts are being turned away. So, patients are struggling to get access to the PCSK9 drugs. "Unfortunately, insurance policies called 'utilization management criteria' and paperwork have all but closed the door for them – even those patients who fit the FDA prescribing information," Jordan wrote. "[S]tudies like this do them no favors."
Meanwhile, some doctors have been reluctant to use the drugs, even in their currently approved indications, without proof that they prevent CV problems--proof that won’t be available till next year at the very earliest. And even when treatment guidelines unequivocally recommend a new drug, those recommendations tend to trickle into real-world practice rather than spread far and wide immediately. So far, both drugs have underperformed expectations.
The JAMA study authors say they analyzed their numbers in a variety of ways--using higher cholesterol levels as a threshold for beginning PCSK9 therapy, for instance, or considering how the results might vary if PCSK9 meds were started after a heart attack or before. And they specified several scenarios, including stopping therapy at 75 years of age.
“Most scenarios resulted in the same or economically less favorable” results for the meds, the study said.
But some changes to target patient populations made a difference. Using higher LDL thresholds for initiating the drugs, for instance, yielded a smaller increase in spending--$28.6 billion over 5 years. That’s closer to analyst estimates for sales. But simply extending cheap statin treatment to all patients who aren’t already taking them would save $12 billion.
“PCSK9 inhibitor therapy is still not cost-effective in these groups at current prices,” the study states, going on to add, “The results of multiple scenario analyses suggest that reducing the price of PCSK9 inhibitors remains the primary approach to improving the value of these therapies.”
A previous assessment by the Institute for Clinical and Economic Research, which has caught fire from pharma companies for its methodology and its funding from payers, concluded that a 67% discount off list prices would be necessary to justify PCSK9 drugs. Taking budget impact into account--which is what the JAMA study aimed to do--the prices would need to come down even more.
Regeneron CEO Len Schleifer criticized ICER’s analysis--and defended his Praluent drug--at a conference earlier this year. He also pointed out that Sanofi and Regeneron had struck some performance-based deals with payers, which guarantee insurers bigger rebates if the drug doesn’t deliver.
“[ICER] did all the calculations and they said it's X, which is OK. I could have lived with that,” Schleifer said. “But ... they said society can't afford X, so we are going to say it's one-third X. They had value-based pricing, but they just decided that, well, we can't afford it. That wasn't scientific. There was no intellectual honesty there."
- read the JAMA study
Regeneron CEO pushes back on pricing criticism of new gen cholesterol meds
Amgen nabs another PCSK9 exclusive, this time with giant CVS
NICE, in reversal, OKs Amgen's Repatha while snubbing Sanofi and Regeneron's Praluent
Citing cost, top doctors back limits on PCSK9 cholesterol fighters
Cost watchdog says PCSK9 meds should cost 85% less. Realistic or not?
Editor's note: Adds comments from Amgen.