JAMA piece resurrects questions over cost of Mallinckrodt's Acthar

Mallinckrodt
Focus has returned to the price of Mallinckrodt's controversial drug Acthar gel in a research letter published in JAMA.

As other drugs have taken center stage in the U.S. debate over pricing, the cost of Mallinckrodt's controversial med, H.P. Acthar gel, has faded into the background. But a new study published in JAMA this week has pushed it back into the spotlight.

The research from the Oregon State University’s College of Pharmacy found that the blockbuster drug’s more than $1 billion in sales have been paid for primarily by Medicare and Medicaid for conditions that often could be treated with less expensive corticosteroids. Spending by Medicare for Acthar increased 10-fold and totaled $1.3 billion from 2011 to 2015, it found.

On top of that, the research letter published this week in JAMA Internal Medicine found that Acthar prescriptions often were written by a relatively small number of frequent prescribers, raising questions about how it is being marketed to those doctors by Mallinckrodt.

"It's a hormone produced in the human body that signals the release of steroids," Dan Hartung, lead author on the research letter, said in a release posted on EurekAlert! from the American Association for the Advancement of Science. "It does the same job as low-cost corticosteroids."

RELATED: Mallinckrodt bets $5.6B on Questcor and its controversial Acthar drug

The drug was already controversial when Mallinckrodt in 2014 paid $5.6 billion to buy Questcor Pharmaceuticals to get its hands on Acthar, a hormone-based drug derived from pig pituitary glands that had been on the market for more than 60 years and is used for more than a dozen conditions, including multiple sclerosis. Questcor drew attention by using the kind of price hikes that would eventually make Martin Shkreli a household name when his Turing Pharmaceuticals raised the price of toxoplasmosis treatment Daraprim 5000%.

Acthar was priced at about $40 a vial when Questcor acquired it. In 2007, the company jacked that up the price so a course of therapy that had run $1,650 suddenly cost $23,000, often paid for by federal programs.

RELATED: Mallinckrodt’s Acthar drama continues with $100M FTC settlement

On top of that, Questcor protected Acthar’s price hikes by acquiring a potential rival and steering its development toward uses that wouldn’t conflict with Acthar. That maneuver led to an FTC probe which Mallinckrodt inherited and settled this year with a $100 million payment. 

Since buying Questcor, Mallinckrodt has said it has kept price increases to "low to mid-single digits." The drug now runs about $36,000 for a course of treatment.

But there also is the question of its effectiveness, Hartung pointed out, a question that has been raised before.

RELATED: Is Medicare wasting $220M a year on Questcor's controversial Acthar?

"There are a variety of FDA-approved indications that lack a lot of evidence that Acthar is even effective, let alone better than inexpensive corticosteroids," Hartung said. "And what allows for this kind of pricing is that it's a fairly complex molecule and no competitors can exactly duplicate it; they have a monopoly on this particular molecule."