Regeneron, Sanofi cut PCSK9 list price, matching earlier move by rival Amgen
- Regeneron and Sanofi will sharply cut the list price of their cholesterol medicine Praluent in a rare move designed to reduce patient out-of-pocket costs and spur uptake of the biologic drug, the companies announced Monday.
- Starting in early March, the PCSK9 inhibitor will be available in the U.S. at a list price of $5,850 per year, 60% less than the original price of $14,625 annually. The reduction matches a price cut taken last year by rival Amgen on its competing drug Repatha.
- Both drugs got off to a slow start following U.S. approvals in 2015 as payer pushback on the drugs' similarly high price tags hindered uptake. That both Amgen and the team of Regeneron and Sanofi decided to lower list prices is significant, and could reflect the beginnings of a broader re-evaluation by drugmakers of the role played by drug rebates, particularly in markets with heavy Medicare exposure.
Monday's announcement isn't the first effort by Sanofi and Regeneron to trade lower pricing for higher prescription volumes.
Last March, following release of positive cardiovascular outcomes data for Praluent (alirocumab), the companies signaled willingness to reduce the drug's net price after rebates for payers that agreed to drop barriers limiting patient utilization.
Express Scripts, now part of Cigna, was the first to cut a deal, granting exclusive placement on its national formulary in exchange for a new net price then reported to be between $4,500 and $6,000 a year.
By reducing Praluent's price outright, Sanofi and Regeneron have given tacit acknowledgement that the previous offer wasn't sufficient to significantly shift market share.
"In 2018, we lowered the Praluent net price for health plans that were willing to improve patient access and affordability," said Regeneron CEO Leonard Schleifer in a Feb. 11 statement. "While lowering the net cost to payers did improve access, seniors who were prescribed Praluent were often still unable to afford it due to high co-pay costs or co-insurance at many Medicare Part D plans."
Regeneron said most Medicare Part D patients would pay between $25 and $150 per month for lower-priced Praluent, which would represent a savings of as much as $345 according to an illustrative scenario laid out by the biotech.
Coinsurance is often based off a drug's list price, rather than the lower net price reflective of rebates paid by drugmakers to payers. Amgen cited a similar rationale in its move to cut the price of Repatha (evolocumab) last fall.
Recent sales data show Repatha to hold a sizable lead over Praluent in the PCSK9 inhibitor market. Measured by new prescription volume, Repatha has captured a roughly 70% market share, according to Iqvia data cited by Wall Street analysts.
Michael Yee, an analyst at Jefferies, recently noted that combined sales of the two drugs are now pacing above a $1 billion per year run rate — a notable threshold for two drugs previously forecast to quickly become blockbusters on their own.
Both drugs are approved to treat certain adults already on maximally tolerated statins who require additional lowering of LDL-C, considered "bad" cholesterol. Repatha is also cleared to reduce the risk of heart attack, stroke or coronary revascularization in adults with established heart disease — an important indication that is seen as having helped Amgen's drug expand its market presence.
For Amgen and the Sanofi/Regeneron team, lowering prices appears to be a bet on higher prescription volumes driving sales higher. In the near-term, however, the drugmakers may see a hit to revenues.
"While the lower net price may impact reported Repatha sales near-term, we expect to see a positive impact on volume growth and reported net sales over the longer timeframe," said Amgen commercial head Murdo Gordon on a recent quarterly earnings call.
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