Amgen cuts US Repatha price 60% amid market pressure
- Amgen has cut the annual list price for its cholesterol-lowering medicine Repatha in the U.S. from $14,523 to $5,850, a decision the company said was to secure broader insurance coverage and lower out-of-pocket costs for patients on Medicare.
- It's a significant reduction, and a rare move for a branded product just three years removed from an initial U.S. approval. Amgen, though, has faced considerable pushback from payers on the drug's price, and remains locked in competition with Sanofi and Regeneron, makers of a rival drug called Praluent.
- That Amgen chose to lower Repatha's list price is notable. Earlier this year, Sanofi and Regneron announced they would offer greater rebates in a deal with Express Scripts that lowered Praluent's net price to between $4,500 and $8,000 a year.
Drugmakers don't typically cut the prices of their products.
Slow sales and market access challenges for Repatha (evolocumab) and its PCSK9 inhibitor peer Praluent (alirocumab), however, appear to have forced their makers' hands.
Despite a score of new contracts with commercial insurers, for example, claims for Repatha are still rejected more than half the time.
In announcing the move Wednesday, Amgen noted that while U.S. sales of Repatha are equally split between commercial and Medicare plans, 75% of patients on Medicare are abandoning treatment. That's largely due to out-of-pocket costs, as commercially insured patients can use a copay card to lower their monthly expense while those on standard Medicare Part D cannot.
For Medicare Part D patients, out-of-pocket costs can also include coinsurance payments that are based on a drug's list price.
Currently, Amgen estimates that patients on standard Medicare plans pay between $280 to $370 dollars a month out of pocket for their Repatha prescriptions. The $5,850 list price should lower monthly costs to around $25 to $150 for Medicare Part D patients, according to the drugmaker.
"As we looked at the problem, we realized that we needed ... the new low-price Repatha at a price point that would allow us to secure formulary listing on fixed co-pay formularies within Medicare Part D, and this target price is intended to do just that," said Murdo Gordon, Amgen's new head of commercial operations, on a Wednesday call.
Amgen has introduced a new National Drug Code for Repatha at the newly announced lower cost in order to implement the price change. The drug will also remain available at its original list price until Amgen discontinues that version by 2020 or earlier — a quirk that the company said was necessary to ensure a smooth transition.
Amgen's announcement comes as political pressure over drug prices appears to have changed the calculus for a number of drugmakers.
Following criticism of Pfizer by President Donald Trump, more than half a dozen pharmaceutical companies — Amgen included — announced they would pause price hikes for the remainder of the year. Merck & Co. went further, cutting prices for seven products, although all were immaterial to the company's revenues.
Asked on a Wednesday call whether political considerations motivated the move, Amgen demurred.
"You can imagine that thinking through this decision took a significant amount of time and pre-dates even the most recent actions and discussions from HHS and/or the administration," said Gordon.
Amgen's action does, though, raise questions about the continuing role of pharmaceutical rebates. Under scrutiny by lawmakers, rebates underpin the current system of list and net prices that makes pharmaceutical pricing so complex.
Gordon noted that the new list price for Repatha would not be "demonstrably different" than the net price Amgen had across its commercial business after rebates.
Just last month, Gilead announced it would introduce authorized generics of its hepatitis C medicines Harvoni and Epclusa at a substantial discount to list price — a move also aimed at reducing out-of-pocket costs for Medicare patients.
Taken together with rumblings of policy changes to come, Amgen and Gilead's actions suggest pharma companies might be giving rebates a rethink.