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1 years ago-Biopharma Group
1 years ago-BioGenes GmbH

With new report, ICER puts itself at center of drug pricing storm

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Pharmaceutical companies often preach value. Yet, for seven top-selling drugs, prices went up in 2017 and 2018 despite limited new evidence showing patients receiving treatment experienced greater benefit, according to a new report.

Taken together, the price hikes added more than $5 billion to U.S. spending on those drugs over the two-year period, a study published Tuesday by the Institute for Clinical and Economic Review said.

The finding is the latest challenge from a group known for criticizing the drug industry’s approach to pricing, and is likely to stir debate at a time when Congress is considering legislation to curb rising drug costs.

Until now, ICER has focused on conducting value assessments of specific medicines, judging whether or not a product is cost effective at its current price. Tuesday’s report, by contrast, is the first time ICER has sought to gauge whether drug price increases could be justified by new clinical results.

For seven of the nine therapies analyzed in ICER’s report, the group judged the evidence it reviewed to be insufficient to support a claim of additional benefit. Even so, prices on those seven drugs rose by an average of 17% on a list basis, and 20% on a net basis after accounting for rebates and discounts.

AbbVie, for instance, increased the list price of Humira by nearly a fifth between the fourth quarter of 2016 and the end of 2018. Rebates offered by the pharma resulted in a net price increase of about 16%, and a corresponding increase in spending of $1.86 billion over the two years.

Two of the drugs reviewed by ICER, Celgene’s Revlimid and Gilead’s Genvoya, were deemed to be supported by new positive clinical data. ICER did not, however, attempt to determine whether that evidence justified the price increases for either drug.

Top drugs with price hikes unsupported by new evidence, per ICER
Drug First approved List price increase* Net price increase* Spending increase due to net price change (millions)
Humira 2002 19.1% 15.9% $1,857
Rituxan 1997 17.0% 23.6% $806
Lyrica 2004 28.3% 22.2% $688
Truvada 2004 14.3% 23.1% $550
Neulasta 2002 14.6% 13.4% $489
Cialis 2003 26.2% 32.5% $403
Tecfidera 2013 16.7% 9.8% $313
AVERAGE 17.0% 20.0% N/A
TOTAL N/A N/A $5,106

SOURCE: ICER, underlying data from SSR Health

Six of the drugs cited by ICER are old, having won initial U.S. approval more than a decade and a half ago. Still, ICER tracked double-digit price increases on both a list and net basis, potentially reflecting a common industry strategy to boost prices ahead of incoming generic or biosimilar competition.

Lyrica, Neulasta and Cialis currently face low-cost competitors, while copycat rivals to Truvada and Rituxan are both expected to soon launch in the U.S.

Unsurprisingly, PhRMA, the industry’s principal lobby, took issue with ICER’s findings, as did drugmakers flagged for taking unsupported price increases.

“In approaching this report, what ICER has done is set an extremely high bar for the evidence that it will consider, but a somewhat low bar for the selection data it used to pick its products to begin with,” said Kimberly Westrich, a vice president for health services research at the National Pharmaceuticals Council, in an interview. The Council is funded by many major drugmakers.

Westrich highlighted ICER’s reliance on data from SSR Health to calculate net prices, which aren’t readily available to the public. SSR Health estimates net price per unit by combining data on unit sales with U.S. sales revenue disclosed by manufacturers.

In a statement, PhRMA also noted that net prices have declined for branded medicines, citing data previously published by Iqvia. Twenty-six of the 100 top-selling drugs initially screened by ICER for its report had negative net prices in 2017 and 2018, meaning rebates washed out the effect of list price increases.

For the nine drugs analyzed in full, ICER reviewed nearly 1,400 references to clinical information either submitted by manufacturers or compiled by the group. Three of those references — for Genvoya and Revlimid —​ were judged to be new evidence of a substantial improvement in net health benefit compared to what was previously shown.

The rest ICER found to be either of low quality, outside the review’s scope or relevant only to an indication accounting for less than 10% of the drug’s use. Many references were from observational, or real-world data, rather than randomized controlled studies, the gold standard of establishing a drug’s efficacy and safety.

“ICER’s data on Humira’s net pricing is inaccurate and again calls into question the methodology ICER employs,” AbbVie wrote in a statement to BioPharma Dive. “AbbVie provided more than 200 recent scientific publications that highlight the clinical and economic value of Humira. Despite these being peer-reviewed publications, none of the evidence has been accepted by ICER.”

Biogen, Eli Lilly and Roche voiced similar concerns in comments on ICER’s report.

To select the nine drugs, ICER compiled a list of the 100 top-selling drugs in the U.S. in 2018. Drugs with list price increases less than two times inflation, as measured by the medical consumer price index, were excluded.

Of the remaining 77 drugs, ICER selected the 10 products with net price increases that contributed the most to increases in U.S. spending in 2017 and 2018. Two drugs, Biogen’s Avonex and Amgen’s Enbrel, were removed from consideration after their respective makers submitted pricing data to ICER that conflicted with what the group obtained from SSR Health.

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