Fresh Pharm News

Johnson & Johnson's ($JNJ) McNeil Consumer Healthcare, which has gotten accustomed to recalling products in large quantities, is retrieving a lot of Imodium–nearly 54,000 packages. There is no health threat, just a hole in some packages that, because of exposure, might reduce the diarrhea drug's effectiveness, The Wall Street Journal health blog reports. This is an old hat for the consumer health unit, which since December has had to recall over 12 million products, from children's Tylenol for a stopper problem to Motrin tablets with a dissolution issue. It is a reminder that new CEO Alex Gorsky has got to get manufacturing problems at the company under control or risk his own standing, particularly given that predecessor Bill Weldon was probably asked to retire early in the face of the constant march of recalls. Story | More

India's plan to again put price controls on the majority of the drugs in the country has become a flash point for companies there as well as Western drugmakers.

The proposal is being debated now and is drawing sharp responses from a spectrum of producers, as well as those who support the plan.

The potential for sales in India has made it a big draw for global companies who are finding emerging markets more attractive than more mature Western markets. Drug spending is projected to hit $17.5 billion by 2014 from $12 billion today, reports The Wall Street Journal. That is a 45% jump in two years.

An estimated 70% of health spending comes directly from the pockets of patients, since about two-thirds of India's 1.2 billion people lack health insurance. That has led to a pervasive idea that Western drug companies owe the country the responsibility of providing lifesaving medications at very low prices. That philosophy has also led to some nasty patent fights. A court recently ordered Germany's Bayer AG to give up its license on its kidney and liver cancer drug Nexavar to an Indian generic drug producer. But some of India's own drugmakers bristle at the plan for price caps.

"The market itself should determine the price," said Ajay Piramal, chairman of Piramal Healthcare. "The customer has the choice to get a cheaper alternative."

Some, like the head of operations in India for Novartis ($NVS), Ranjit Shahani, suggest that instead of artificially depressing drug prices, the government needs to provide better access to healthcare. "Access goes far beyond pricing," Shahani was quoted as saying in the media.

The government has yet to follow through with a promise to increase public healthcare spending to 2.5% of gross domestic product over the next 5 years from 0.9% currently to upgrade decrepit hospitals and educate more doctors.

Thirty years ago, India had price controls on about 350 drugs but reduced that to 74 in the 1990s as it moved toward market reforms. It sets a price for those drugs after calculating a manufacturing cost and putting a maximum markup on them. Those 74 represent about 20% of the drugs in the market. The proposal, which could become law this year, is looking to increase that to about 65% of drugs.

- read the WSJ story

Related Articles:
Bayer slams Indian government, Cipla on Nexavar copies
Pfizer exec: Indian price move would push pharma to 'semi-recession'
India's Cipla puts fire-sale prices on cancer drugs
U.S. questions India's IP regime after Nexavar move

India's plan to again put price controls on the majority of the drugs in the country has become a flash point for companies there as well as Western drugmakers.

The proposal is being debated now and is drawing sharp responses from a spectrum of producers, as well as those who support the plan.

The potential for sales in India has made it a big draw for global companies who are finding emerging markets more attractive than more mature Western markets. Drug spending is projected to hit $17.5 billion by 2014 from $12 billion today, reports The Wall Street Journal. That is a 45% jump in two years.

An estimated 70% of health spending comes directly from the pockets of patients, since about two-thirds of India's 1.2 billion people lack health insurance. That has led to a pervasive idea that Western drug companies owe the country the responsibility of providing lifesaving medications at very low prices. That philosophy has also led to some nasty patent fights. A court recently ordered Germany's Bayer AG to give up its license on its kidney and liver cancer drug Nexavar to an Indian generic drug producer. But some of India's own drugmakers bristle at the plan for price caps.

"The market itself should determine the price," said Ajay Piramal, chairman of Piramal Healthcare. "The customer has the choice to get a cheaper alternative."

Some, like the head of operations in India for Novartis ($NVS), Ranjit Shahani, suggest that instead of artificially depressing drug prices, the government needs to provide better access to healthcare. "Access goes far beyond pricing," Shahani was quoted as saying in the media.

The government has yet to follow through with a promise to increase public healthcare spending to 2.5% of gross domestic product over the next 5 years from 0.9% currently to upgrade decrepit hospitals and educate more doctors.

Thirty years ago, India had price controls on about 350 drugs but reduced that to 74 in the 1990s as it moved toward market reforms. It sets a price for those drugs after calculating a manufacturing cost and putting a maximum markup on them. Those 74 represent about 20% of the drugs in the market. The proposal, which could become law this year, is looking to increase that to about 65% of drugs.

- read the WSJ story

Related Articles:
Bayer slams Indian government, Cipla on Nexavar copies
Pfizer exec: Indian price move would push pharma to 'semi-recession'
India's Cipla puts fire-sale prices on cancer drugs
U.S. questions India's IP regime after Nexavar move

This week marks the end of an era for Bristol-Myers Squibb. The big-selling Plavix bloodthinner lost patent protection and the FDA promptly approved several generic versions. Given that the medication generated billions of dollars a year in revenue for the drugmaker and its marketing partner, Sanofi, this was a predictable, if notable, development. However, the patent expiration triggered yet another story that also caused a lot of buzz for the drugmaker.

Three years ago, a former Bristol-Myers Squibb senior vice president named Andrew Bodnar pleaded guilty to lying to federal authorities about a spectacularly botched patent deal involving Plavix. And as part of his punishment, a judge ordered Bodnar to write a book so others might learn from his mistakes. The book (there is link to be found here) was filed in federal court last fall, but only came to light this week. A coincidence?

In any event, the combined events meant that more buzz wa generated this past week for Bristol-Myers than any other drugmaker on Twitter, Facebook and other venues, according to Semantelli, a market research firm that tracks social media in the pharma world. We should note that – rather than simply list drugmakers garnering the most attention, which would likely yield a few obvious candidates time and again – we sought those with the biggest week-over-week change.

A close second was Gilead Sciences, which scored a pair of wins late last week before FDA advisory panels that voted to recommend approval for its experimental four-in-one HIV pill, as well as use of the Truvada drug for preventing HIV infections. Trailing the biotech was Alkermes, which posted a larger-than-expected quarterly loss.

And as the chart indicates, Hospira generated chatter buzz over a product recall, which came on the heels of still more questions about manufacturing problems. Finally, Eli Lilly caused some buzz by confirming support was being withdrawn for the controversial Heartland Institute, which has openly challenged scientific notions about global warming with a series of provocative position papers and even billboards.

Abbott Laboratories is facing a battle over its Kaletra HIV medication in yet another country. The Malaysian AIDS Council earlier this month requested that the Health Ministry issue a compulsory license so that lower-cost generic versions could be imported. The move comes after the group sought a license from Abbott last November, but apparently without any success.

In seeking a license, the group notes that the monthly cost for Kaletra is approximately $300, which is “prohibitively high for Malaysian patients living with HIV,” they wrote in their letter. “Generics… are available at a fraction of this price on the global market. A government use license for Abbott’s patents would authorize Malaysia to import these generics and provide them to the public through government programs” and offer a “second-line treatment at a low cost.”

The move comes amid growing clashes between AIDS advocates and the drugmaker in several countries over Kaletra pricing. The advocacy groups maintain that prices charged for Kaletra are blocking expansion of AIDS treatment and drug innovation. And so, last fall, a coordinated global effort was begun in several countries in hopes of loosening the grip that drugmaker has on its Kaletra patents.

One effort yielded a mixed result. An administrative judge in Colombia recently ruled that the drugmaker and the government health ministry improperly maintained the Kaletra price above the so-called reference price. At the same time, though, the judge declined to issue a compulsory license for the drug, an issue that prompted advocacy groups to file their lawsuit two years ago. Both sides are appealing (back story).

There is a long-running history at work, by the way. Four years ago, Abbott agreed to settle a lawsuit charging a 400 percent price hike on Norvir – a component in Kaletra – that was undertaken some years earlier violated antitrust laws (see this). The move sparked shareholder resolutions, protests at Abbott headquarters, a boycott by hundreds of docs and attorney general investigations.

And five years ago, Abbott refused to sell new drugs in Thailand after the government issued compulsory licenses for several medicines, including Kaletra. Applications to market seven new drugs were yanked. The Thai government argued that needed meds were priced too high for most of it citizens and it had the right to override patents under provisions of a World Trade Organization agreement. Abbott subsequently relented by allowing a new pediatric version into the country (look here).

Abbott is not the only drugmaker, though, to be engaged in battle over compulsory licensing. Two months ago, India’s Patent Office for the first time granted a generic drugmaker a compulsory license to make a copycat version of a patented medicine. The license was awarded to Natco, which can now make a generic of a Bayer kidney and liver cancer medication called Nexavar, although only for domestic distribution. Bayer is appealing (read this and this).

We asked an Abbott spokesman for comment and hope to hear back shortly. Meanwhile, here is the letter that the Malaysian AIDS Council wrote to Abbott last fall.

Abbott Laboratories is facing a battle over its Kaletra HIV medication in yet another country. The Malaysian AIDS Council earlier this month requested that the Health Ministry issue a compulsory license so that lower-cost generic versions could be imported. The move comes after the group sought a license from Abbott last November, but apparently without any success.

In seeking a license, the group notes that the monthly cost for Kaletra is approximately $300, which is “prohibitively high for Malaysian patients living with HIV,” they wrote in their letter. “Generics… are available at a fraction of this price on the global market. A government use license for Abbott’s patents would authorize Malaysia to import these generics and provide them to the public through government programs” and offer a “second-line treatment at a low cost.”

The move comes amid growing clashes between AIDS advocates and the drugmaker in several countries over Kaletra pricing. The advocacy groups maintain that prices charged for Kaletra are blocking expansion of AIDS treatment and drug innovation. And so, last fall, a coordinated global effort was begun in several countries in hopes of loosening the grip that drugmaker has on its Kaletra patents.

One effort yielded a mixed result. An administrative judge in Colombia recently ruled that the drugmaker and the government health ministry improperly maintained the Kaletra price above the so-called reference price. At the same time, though, the judge declined to issue a compulsory license for the drug, an issue that prompted advocacy groups to file their lawsuit two years ago. Both sides are appealing (back story).

There is a long-running history at work, by the way. Four years ago, Abbott agreed to settle a lawsuit charging a 400 percent price hike on Norvir – a component in Kaletra – that was undertaken some years earlier violated antitrust laws (see this). The move sparked shareholder resolutions, protests at Abbott headquarters, a boycott by hundreds of docs and attorney general investigations.

And five years ago, Abbott refused to sell new drugs in Thailand after the government issued compulsory licenses for several medicines, including Kaletra. Applications to market seven new drugs were yanked. The Thai government argued that needed meds were priced too high for most of it citizens and it had the right to override patents under provisions of a World Trade Organization agreement. Abbott subsequently relented by allowing a new pediatric version into the country (look here).

Abbott is not the only drugmaker, though, to be engaged in battle over compulsory licensing. Two months ago, India’s Patent Office for the first time granted a generic drugmaker a compulsory license to make a copycat version of a patented medicine. The license was awarded to Natco, which can now make a generic of a Bayer kidney and liver cancer medication called Nexavar, although only for domestic distribution. Bayer is appealing (read this and this).

We asked an Abbott spokesman for comment and hope to hear back shortly. Meanwhile, here is the letter that the Malaysian AIDS Council wrote to Abbott last fall.

Employers have drug costs on their minds lately. Balancing the cost of drugs against care has swelled as the key consideration for companies evaluating drug plans in a survey by Express Scripts.

Where 5 years ago only 41% of respondents said "balancing cost with care" was their main concern, now that number is 78%, reports Reuters. Meanwhile, where 57% said "providing the broadest coverage" was the most important measure 5 years ago, now only 14% of respondents think that is the main deal.

How companies and their benefit managers structure prescription drug benefits can have a big impact on the pharmaceutical industry. And they have been taking aggressive steps to keep on top of prices. A coalition of unions and a consumer group recently sued 8 of the largest companies, including Pfizer ($PFE), Merck ($MRK) and GlaxoSmithKline ($GSK), for using coupons to try to lure patients away from generics. 

And companies are thinking hard about things like the cost of specialty drugs, the high-priced medications often used for the most serious conditions like cancer or rheumatoid arthritis. While only 36% of plan managers said specialty drugs are their key concern, the drugs are the primary concern for 58% of companies with more than 25,000 employees.

There is a reason specialty drug costs are on employers' minds, Tim Wentworth, Express Scripts' president of sales and account management, tells Reuters. While they make up less than 30% of what a company is spending on drugs, they are the fastest-growing segment in terms of cost. Last year, spending on medications grew 2.7% while spending on specialty drugs was up 17.1%, he said. It is the fastest-growing segment, "so they want to put things in place now," he says.

One way to do that is with step therapy, requiring plan members to try the low-cost drug before moving to another medication. Most companies expect to institute such a plan within two years, the survey found.

- read the Reuters story

Related Articles:
Payers likely to throw up hurdles to Pfizer's new RA drug
Health plans sue Big Pharma over co-pay coupons

In a bit of drug family planning, Warner Chilcott ($WCRX) has sued Watson Pharmaceuticals ($WPI) to prevent it from putting out a generic version of its oral contraceptive Lo Loestrin Fe.

It is a sensitive time for Warner Chilcott, which recently announced that it was exploring alternative strategies for the company, the buzzwords that indicate that it is probably putting itself on the market. It has said it is talking with potential suitors. By going to court, Warner freezes the FDA from approving the generic for 2½ years, reminds Bloomberg.

Warner Chilcott, in its federal court filing, claims that Watson, a large generic player, would violate two patents and seeks to hold it off until they expire in July 2014 and February 2029, reports Bloomberg.

Warner Chilcott had revenue of $2.7 billion last year, led in part by the Loestrin portfolio of drugs, but sales are predicted to fall 15% for the three years ending in 2014 as generics begin to attack the line. Meanwhile, production of its Ovcon 50 mg contraceptive has been interrupted because the plant in Puerto Rico where it is manufactured is laboring under an FDA warning letter. 

- read the Bloomberg story

Related Articles:
Warner Chilcott lowers outlook
Analysts size up Warner Chilcott's merits for sale
Warner Chilcott's Puerto Rico plant still beset by problems

Just one month after becoming Johnson & Johnson ceo, Alex Gorsky is presiding over a product recall, the latest in an endless stream of such actions taken by the health care giant over the past two years. This time, the McNeil Consumer Healthcare unit, which has been responsible for the majority of recalls, is yanking 53,892 packages – or one lot – of Immodium, the over-the-counter medicine for diarrhea, gas, bloating and cramps.

Why? A McNeil spokeswoman tells us there was a “packaging issue” that may have allowed “a limited number of blister units” to be exposed to air, potentially robbing consumers of the full benefit of the medicine. Despite the flub, she maintains the Immodium track record is otherwise quite good – more than 2.75 million packages have been made over the past five months without any other difficulties (here is the recall info).

Nonetheless, the recall serves as a reminder of the systemic problems that have caused J&J to withdraw tens of millions of over-the-counter meds, contact lenses, epilepsy drugs and hip replacement devices, among other items. There have also been embarrassing shortages of Tampons and shampoos. Manufacturing gaffes have also led to an FDA probe and a consent decree; highly publicized congressional hearings; a closed plant and accompanying job losses; managerial changes; eroded consumer confidence; various lawsuits and hundreds of millions of dollars in lost sales.

The ongoing difficulties have been especially troubling for the McNeil business, which suffered a 2.4 percent drop in sales during the first quarter as every product segment in the unit experienced revenue setbacks. The tumbling financial performance was reported along with the not-so-surprising news that a Fort Washington, Pennsylvania, plant – which is being reborn – will not open until at 2014, more than a year later than J&J execs previously forecast (see this).

The continual setbacks led to regular calls for former ceo Bill Weldon to resign, although he stubbornly clung to a succession timetable that culminated in naming Gorsky, who previously ran the medical device and diagnostics business, to occupy the proverbial corner office. However, the change drew some criticism if only because Gorsky has been part of the same executive team that has presided over the companywide manufacturing and quality failures.

Last month, upon succeeding Weldon, who remains chairman, Gorsky held select media interviews in which he talked up his determination to overcome these problems and that doing so successfully is a key priority. He is now being tested. Meanwhile, perhaps he should be thankful that most Immodium has been manufactured without a glitch. If the number and pace of recalls do not end anytime soon, he may need that Immodium himself.

Plavix is a blood thinner from Bristol-Myers Squibb ($BMY). Generic Plavix is a Bristol-Myers profits thinner that is going to be produced by just about everybody and their brother.

The FDA on Thursday approved a long list of companies that supply clopidogrel, the generic version of the megablockbuster drug that last year brought in about $6.8 billion in the U.S. for BMS and its partner Sanofi ($SNY).

In an effort to hold onto as much of that revenue as they can, the pair said they will be offering current patients a special program that would bring the monthly cost of Plavix down to $37 from the expected $100, reports The Wall Street Journal. It is a tactic used to little success by Pfizer ($PFE) in the face of the generic onslaught on Lipitor. Lipitor last year was the only drug that outsold Plavix in the U.S., but it has seen such erosion of market share that Pfizer has quietly given up marketing it.

BMS executives acknowledge that in a generic Plavix world, sales gains are going to be more difficult to cultivate. Plavix last year accounted for 33% of its revenue. They were encouraged by growing sales of some new drugs in the first quarter, including cancer drug Yervoy, hepatitis B drug Baraclude, and Sprycel, a drug for chronic myeloid leukemia, which posted a 34% gain to $231 million.

So who gets to sell generic Plavix in the U.S.? The 75-milligram dose will be sold by Mylan Pharmaceuticals ($MYL), Teva Pharmaceutical Industries ($TEVA),  Apotex, Aurobindo Pharma, Roxane Laboratories, Sun Pharmaceutical Industries and Torrent Pharmaceuticals, the WSJ says.

Teva, Mylan, Dr. Reddy's Laboratories and Gate Pharmaceuticals, get to sell a 300-milligram dose of clopidogrel, with Mylan getting an 180-day exclusivity for being first across the approval finish line. Mylan apparently has its clopidogrel ducks all lined up because it says it is shipping its products immediately. 

- here's the WSJ story
- read the FDA release

Related Articles:
Bristol turns to blockbuster pipeline as Plavix goes generic
Bristol-Myers hits estimates for the quarter but still faces tough going