Watchdog lawmakers interrogate Ariad’s ‘staggering’ price hikes

sanders
Sen. Bernie Sanders was one of two lawmakers to write a letter to Ariad CEO Paris Panayiotopoulos demanding more information on "staggering" price hikes for Iclusig. Image courtesy of Wikipedia user Sahincatary.

Industry watchers wondering which biopharma company will land in hot water next for big price hikes may have their answer. Frequent pharma critics Sen. Bernie Sanders and Rep. Elijah Cummings have homed in on “staggering” price increases by Ariad Pharmaceuticals for leukemia drug Iclusig.

In the four years that Iclusig has been on the market, Ariad took the price to $199,000 per year from $115,000 per year, even as safety problems caused the FDA to restrict patients to a smaller group than the drug’s initial approval, the congressmen wrote in a letter to Ariad CEO Paris Panayiotopoulos. The drug has seen four price hikes this year alone. Now, Sanders and Cummings want to learn more.

The congressmen are requesting documents from 2012 to present on Iclusig revenues, expenses, sales contracts and more. They’re also wondering why Ariad discontinued a two-month, 60-tablet supply in favor of a 30-tablet supply for the same price, “effectively doubling the cost for patients.”

As they have done with some of the industry’s most noted price hikes from the last year, Sanders and Cummings went on the attack in their letter, saying Ariad’s “outrageous sales tactics” have put profit before patients.

Ariad quickly issued a statement acknowledging the letter, adding that it “recognizes the high cost of innovative oncology drugs and believes in the importance and efficacy of its products.” It’s spent $1.3 billion on R&D so far and isn’t making a profit, the statement said.

“After years of risk-taking and research, the Company has brought its first product to market serving a very small and seriously ill group of cancer patients,” Ariad’s statement said. “Ariad remains fully committed to developing critical therapies for unserved and underserved small patient populations suffering from rare cancers.”

Panayiotopoulos joined Ariad in January following Sarissa Capital’s successful ouster of former helmsman Harvey Berger. With Panayiotopoulos at the wheel, Ariad raised prices “several more times” to its current sticker, Sanders and Cummings wrote.

The letter comes on the heels of a report by TheStreet profiling the company’s latest price hike and the company’s reasoning that a small patient pool--brought on by Iclusig’s safety problems--justifies the price tag. Ariad's shares are off about 19% since that story.

Now, the biotech will be fending off unwanted attention as it navigates an industry battered by negative headlines following now-notorious hikes by Turing Pharmaceuticals and Valeant. Most recently, Mylan’s been on the hot seat for years of price hikes on its lifesaving epinephrine injector EpiPen.

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