Vertex ($VRTX) had a pretty good idea that drug pricing critics wouldn't be so keen on its $259,000-per-year tag for cystic fibrosis med Orkambi. And sure enough, less than three weeks after the combo med won the FDA's green light, the pushback is here.
A group of prominent cystic fibrosis specialists is going public with its pricing fight, which has been brewing ever since the company rolled out its first treatment, Kalydeco, more than three years back, The Boston Globe reports.
"It's egregious," Paul Quinton, a professor of biomedical science at the University of California at San Diego, told the newspaper. "This is more than 5 times the annual salary of the average American family. How can they in good conscience charge that much?"
Vertex, though, has a four-point justification, as chief commercial officer Stuart Arbuckle laid out on a conference call following Orkambi's approval. There's Orkambi's small patient population; the clinical benefit of a therapy that treats the underlying cause of CF; the time and cost Vertex plowed into bringing the med to market; and the need to invest in further R&D to aid thousands of other patients with different forms of the disease down the line, he said.
"Right now, two-thirds of the patients in the United States don't have medicines'' to treat the cause of CF, company spokesman Zach Barber told the Globe. "We want to help those people. That work is going to take a very long time, hundreds of people, and a very significant continued investment.''
As the group of critics told the paper, Vertex CEO Jeffrey Leiden has also warned them that lower prices could leave the Massachusetts drugmaker vulnerable to takeover by a larger company with less interest in pursuing CF drug development. And that's not an unfathomable idea--at least not to Bernstein analyst Geoffrey Porges, who in April suggested hep C star Gilead ($GILD) should snap Vertex up as soon as possible.
Critics, though, have been quick to point out that other parties--including the National Institutes of Health, the Cystic Fibrosis Foundation and others--have helped out with research funding. Plus, they say, Vertex' execs have made a pretty penny since jumping into the mix.
The doctors' concerns don't end there, either. The group is worried about specialty drugs of all kinds--and the toll they'll take on both patients the U.S. healthcare system. "This is not sustainable," Brian O'Sullivan, a pulmonary specialist at Dartmouth-Hitchcock Children's Hospital in New Hampshire, told the Globe.
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