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| Express Scripts CMO Steve Miller |
Express Scripts CMO Steve Miller has a number for you: $4 billion. That's the amount U.S. payers will save on hepatitis C drugs this year, thanks to cost-cutting deals with Gilead Sciences ($GILD) and AbbVie ($ABBV). And Miller doesn't mind saying that Express Scripts ($ESRX) started the trend.
The pharmacy benefits manager announced the first hepatitis C exclusive--with AbbVie on its newly approved Viekira Pak--and a raft of other deals soon followed. In a post on Express Scripts' blog, Miller says the company will save $1 billion this year because of its AbbVie exclusive. Other payers' negotiated discounts account for the rest of that $4 billion.
How does Miller know about other payer deals? Express Scripts has "visibility," a spokeswoman told BioCentury. It can also take the credit for triggering the spate of discount deals.
"[O]ur unprecedented agreement with AbbVie transformed the pricing landscape for both hepatitis C products and for all U.S. payers," Miller writes "After our deal, other payers have begun to follow suit and negotiate their own arrangements with either AbbVie or Gilead. Because of our initial action, these follow-up negotiations will ultimately lower the national spend on hepatitis C drugs by more than $4 billion annually."
Soon after Express Scripts announced its exclusive with AbbVie, CVS Health ($CVS) followed suit with its own exclusive, this time with Gilead Sciences on its meds Sovaldi and Harvoni. Gilead has inked several deals since, including arrangements with the insurers Anthem and Aetna. The terms of each deal vary, but what they all have in common are "substantial" discounts.
No question that Miller is patting himself on the back here. We could point out that it was CVS Health that introduced the first formulary that specifically excluded particular brands, publicly anyway. Or that companies have previously negotiated with both PBMs, trading discounts for exclusive spots on their formularies.
But Express Scripts--with Miller as its vocal representative--has been the standard-bearer on hepatitis C. Miller was an early critic when Gilead announced its $84,000 price on Sovaldi, the first in a new, wildly effective generation of hep C meds. He vowed to hold pharma's feet to the fire when Sovaldi's competition--including Viekira Pak--hit the market. He even publicly promised to ally with other payers to pit hep C drugmakers against each other for better pricing.
"Without Express Scripts taking a stand--and keeping our promise--none of this would have happened," Miller contends. Maybe not. But what's certain is that U.S. payers are feeling bold now. And the strong-arming won't stop with hep C. Miller calls these first deals "just the tip of the iceberg." Wait and see what payers do with cholesterol and cancer.
- see the blog post
Special Reports: The most influential people in biopharma - Steve Miller, Express Scripts | The new drug approvals of 2014 - Harvoni - Viekira Pak