- Investment bank Leerink lowered its rating for Dova Pharmaceuticals stock from "Outperform" to "Market Perform," reflecting what analysts expect to be a slow launch of the biotech's new drug because of its higher-than-expected price.
- The drug, Doptelet, received regulatory approval in late May as a treatment for adults with chronic liver disease who have low platelet counts and upcoming medical procedures that could cause increased bleeding. Dova is also looking to get Doptelet cleared for immune thrombocytopenic purpura (ITP), but in the meantime strapped it with a $9,000 to $13,500 price tag for a five-day regimen, depending on the dose.
- "This new rating reflects our views of the complex commercial environment for Doptelet in its first indication, and the uncertainty about the regulatory outlook for the ITP application," Leerink analyst Geoffrey Porges wrote in a July 9 investor note.
Pfizer pulled a rare move this week when, following talks between CEO Ian Reid and President Donald Trump, it agreed to rescind a swath of newly enacted price hikes. The decision was surely seen as a win by the administration — which has, through the Department of Health and Human Services, reportedly been pushing drugmakers to slash prices — yet it's not particularly reflective of wider pharmaceutical sentiment regarding price.
Despite intense pushback from payers and lawmakers, many drug manufacturers don't look poised to enact meaningful price cuts anytime soon. The nation's 10 largest companies suggested as much in response letters to Sens. Elizabeth Warren, D-Mass., and Tina Smith, D-Minn., last month.
Lofty price tags aren't solely tied to big pharma either. Dova, for instance, raised eyebrows when it revealed a $9,000 wholesale acquisition cost for a five-day course of 40 mg Doptelet. Analysts noted the price is not only higher than the average platelet transfusion, but in many cases would be more expensive than whatever medical procedure patients were about to undergo.
And that could be a big problem for the drug's uptake.
"Even for the patients that are most suitable for Doptelet, the patient identification, verification and approval processes mean many will not actually receive the treatment despite theoretically being eligible," Leerink's Porges wrote in the July 9 note.
Talking to proceduralists and liver specialists, Leerink also found many factors stand in the way of physicians adopting Doptelet treatment, such as scheduling logistics, reimbursement and cost.
"All these issues can be solved, but it seems likely that it will take many quarters before the provider and patient logistics are streamlined such that significant recurring treatment volume can be expected," Porges wrote. Along with its rating downgrade, Leerink now expects $9 million in Doptelet sales in 2018 versus consensus of $13 million, and $347 million of sales in 2022 versus consensus of $343 million.
Dova, meanwhile, estimates a roughly $2.5 billion opportunity for its debut drug, comprised of about $800 million for the first indication and $1.7 billion for follow-on acute indications.
At investment bank Jefferies' 2018 Healthcare Conference, Dova also laid out its early launch plans. Sales representatives began reaching out to mostly hepatologists, as well as some interventional radiologists, in early June.
Company leadership acknowledged too they didn't intend to offer rebates at launch for the first indication, and didn't think payers would be "actively managing the category," according to a June 5 investor note from Jefferies analyst Eun Yang.