The Big Red Biotech Blog

High Drug Pricing Next Industry Challenge?

The good news from 2012 might be that more drugs were actually approved (39) than in the very recent past -- but the bad news is that many were VERY expensive.  Xconomy's Luke Timmerman did a nice piece summarizing this a couple of days ago.  It seems that many of the very high priced drugs are coming into the oncology and "rare disease" or orphan arenas.  Many of these drugs carry price tags into the serious 6 digits and are $300K or more annually.  Is this sustainable?  Are any of these products worth it?

Those are questions that the industry must face as healthcare systems around the world struggle with costs.  Individual patients oft times may have to struggle as well depending on what type of insurance coverage they carry.  And even in the industry, some players must worry that the action of their peers might be in danger of killing a golden goose if these prices are perceived publicly -- even by physicians -- as being out of line with reality. 

What's a drug worth?  One answer might be what the market is willing to pay.  But will that number change as government and other third party payers become budget constricted. Yes, is the obvious answer.  From a payers perspective, they want a price that they feel is commeasurate with the benefits that are received.  Same from a patient's perspective, I hope.  Do I feel I got my money's worth in terms of improved health or quality of life? 

There is no doubt that this issue will not go away. 

Posted by Bruce Lehr Feb 13th 2013.

New Drug Approvals in 2012

Here's a quick piece from CEN-Online that overviews and discusses the 39 new drug approvals by FDA in 2012.  The good news is that we have seen a 2 year trend now where more drugs have been approved than in the recent past.  This may say that changes being made to R&D departments throughout the industry are starting to have an effect but more than likely it is too early to make such a statement -- however at least the trend is "good". 

It does appear that the relationships between FDA and the drug companies have improved and there is better information sharing and collaboration.  A troubling trend has been developing though with pricing and this may be the next hurdle that needs to be addressed in the industry and among goverments and payers -- not to mention patients and physicians.

Posted by Bruce Lehr February 13th 2013

 

FDA's Sprinter Pathway to Possible Approval

The FDA's new "breakthrough" designation may allow drug makers to get their products through to commercialization after only performing enhanced Phase I trials -- of course they have to meet the criterion and actually show their product works.  No small task.  However, this could be a game changer in terms of shortening the path to market and gaining return on investment --- not to mention giving patients a shot at a new treatment much earlier.

Vertex has already expoited this pathway twice in gaining approval for its cystic fibrosis medication Kalydeco and in testing its cobination therapy VX-809.  A third drug also has breaktrhough status and 18 more applications are pending with FDA.  It seems the race is on -- and its a sprint.

This will no doubt have many backers with drug makers, patients, payers and investors.  It offers many potential benefits for novel treatments of diseases with unmet needs in particular.  We'll just have to see if the program lives up to its advertisements.  See Fierce Biotech.

Posted by Bruce Lehr Feb 13th 2013.