OB/GYN group says KV's Makena deserves reimbursement

Medical societies aren't exactly backing away from their criticism of KV Pharmaceuticals' ($KV.A) pricing on its premature birth preventive Makena. But they are saying their opinions shouldn't be used to deny reimbursement for the drug--and that doctors should be the ones to choose whether patients get the pricey Makena or the long-used, inexpensive compounded version.

Analysts see the statement from the American College of Obstetricians and Gynecologists as a big plus for KV, which drew lots of fire from doctors, patient groups and healthcare-cost watchdogs when it slapped a $1,500 price tag on Makena. The drug isn't a novel compound, but an FDA-approved, standardized version of a hormone injection OB/GYNs have been using for years to stave off premature birth. KV went through the trouble and expense required to put its drug through clinical trials, however, winning it 7 years of exclusivity from the FDA.

Agency officials were surprised by the sticker price on Makena, and after some fierce disapproval in the marketplace--not to mention threats issued from KV to the compounding pharmacies that make the older alternative--the FDA basically said it wouldn't go after pharmacists turning out the compounded version.

KV cut its price to $690 per injection, which is still quite a lot compared with the $10 to $15 for the compounded drug. ACOG scoffed at that move as "woefully inadequate." Now, however, it says the compounded versions aren't identical to Makena, and doctors should be able to choose the branded drug over compounded versions. Insurers may have taken its criticism of the drug's price tag out of context, ACOG said, and used it "to interfere with physicians' judgment." The Society for Maternal-Fetal Medicine joined ACOG's statement.

"This announcement strengthens KV's argument that doctors should provide the FDA-approved product, Makena, and shouldn't replace it with the much cheaper compounding pharmacy drug," Gabelli analyst Kevin Kedra told Bloomberg. "This won't stop compounding pharmacies, but it lends a strong voice of support to Makena."

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