Express Scripts Targets New Migraine Drugs to Change U.S. Pricing Dynamic

Value-based refunds also pursued

The largest U.S. manager of prescription benefits is telling drug-makers that the current pricing model is broken and is taking aim at Amgen and other makers of new migraine medicines to try and fix it, according to a Reuters report.

Express Scripts told Reuters it is pressing them to forego the usual strategy of setting a high U.S. list price, then lowering the cost for health plans through hefty rebates. It is also seeking a refund if the drugs don’t work within a defined timeframe. The shift could help Express Scripts and other pharmacy benefits managers (PBMs) bring prices down, and deflect growing criticism of their role as “middlemen” in the drug supply chain.

The Trump administration and members of Congress have demanded that PBMs pass on more of the rebates they receive to consumers outraged over rising costs at the pharmacy counter. Many Americans now have health plans with higher deductibles or copayments, making them responsible for more of their medical costs.

Express Scripts is advising drug-makers to take that shift into account as they launch a new class of migraine drugs, according to the article.

“If your expectation is that you are not going to actually get that high list price, then don’t do that to patients who have high copays,” Chief Medical Officer Steve Miller said in an interview with Reuters, describing his message to Amgen and its rivals. “Let’s be more balanced. Let’s get back to where gross-to-net is not so different.” Amgen’s erenumab (Aimovig) is expected to be approved next month, followed by similar drugs from Teva Pharmaceutical Industries Ltd. and Eli Lilly and Co. that the companies say could benefit up to four million people in the United States.

The injected therapies interfere with the function of a molecule involved in the processes that kick off a migraine, such as dilation of blood vessels in the brain.

Wall Street analysts expect Amgen to announce a list price of up to $10,000 per year for erenumab once it is approved, setting the tone for competitors, Reuters says.

But Express Scripts and other PBMs restrict access to new drugs they deem too expensive, asking doctors to provide detailed evidence of why a specific patient may benefit, requiring the use of other drugs for a period of time or favoring cheaper rivals when available.

Drug-makers could face similar issues with the new migraine treatments, Miller told Reuters: “Should they price these things too high they will probably not be able to achieve much market share.”

Express Scripts is also pushing Amgen and its peers to refund two-thirds of the cost of a migraine drug if a patient stops treatment within 90 days because it didn’t work or caused major side effects.

Such guarantees are becoming more prevalent for older drugs with competing products on the market, including diabetes and hepatitis C therapies. It would be unusual to introduce them for the first drug in an entirely new class of therapy. Amgen, which will market erenumab in partnership with Novartis, declined to comment to Reuters on talks with Express Scripts. Research chief Sean Harper said in a recent interview that payers share blame for the current pricing model.

Their demands for ever-larger rebates has forced manufacturers to use higher list prices as a benchmark, he said.

“It is a ridiculous situation that we are in,” Harper said. “No one is paying the list price, but patients are exposed for a period of time” until they pay off their insurance deductible.

Erenumab is far more effective at preventing migraines than current treatments, mainly low cost generic drugs, according to the article. Recent studies have shown that the drug reduces episodic migraines by at least half in around 50% of patients.

The FDA is expected to decide on erenumab by May 17. The agency’s decision on Teva’s treatment fremanezumab had been expected in June, but that may be delayed due to manufacturing issues. A ruling on Lilly’s galcanezumab is expected later in the year.

Source: Reuters; April 24, 2018.