Today's Managing Health Care Costs Number is $600 million
JAMA Internal Medicine just published a description of the six year journey of Duexis, a drug approved by the FDA for treatment of arthritis for those at risk for gastrointestinal bleeding. Pretty much no one looks especially good here.
The drug is marked by Horizon Pharmaceuticals, and is a combination of ibuprofen (available over the counter as a generic for pennies a pill) and famotidine (also available over the counter for pennies a pill.) When it was approved, it cost $158.40 a month (average wholesale cost.) Today, its wholesale price is $2061 a month! The company has earned over $600 million in revenue from this medication.
Who would prescribe such a drug?
Physicians would be leery of prescribing such a medicine, for fear that they would be forced to go through a prior authorization program. Horizon Pharmaceutical's answer: have its employees complete this program!
Who would fill such a prescription?
Patients would be suspicious of a prescription drug that cost this much a month when they could just purchase the components over the counter. Horizon offers coupons capping member responsibility at $10 - and even gave the drug away for free to those whose pharmacy benefit managers blocked it so that physicians wouldn't stop prescribing it.
These coupons are prohibited for Medicare and Medicaid beneficiaries, right?
Yes - but the pharmaceutical company has arranged for a "charity" to cover patient cost sharing to members of government sponsored health plans. The pharma donates to this charity - which then undermines the cost sharing requirement of the health plan. The economics of this are very much like coupons.
What pharmacy benefit manager would have this medicine "on formulary," or would fail to frankly block prescriptions?
The authors report that CVS Caremark recently put Duexis back on its formulary. Presumably, there is a large rebate available - so while the employer or insurer covering the patient pays a high price for the drug, it helps the PBM's bottom line.
Why does the FDA even approve such a bogus drug?
These are the rules. The FDA is supposed to be promoting safety and innovation -but it is prohibited from considering cost effectiveness or value in its determinations of what medications to approve.
The authors suggest expanding the ban on these coupons which raise the cost of health care - and better regulating copay assistance charities - which at this point use essentially all their resources to subsidize expensive brand name medications. They would also prohibit specialty pharmacy companies from completing prior authorization paperwork for physicians. I'd like to see the FDA consider value in its approvals, and further transparency around rebates, which might discourage PBMs from providing coverage for wasteful products like Duexis.
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