Dive Brief:

• Regeneron Pharmaceuticals and Sanofi will substantially lower the net price of their expensive heart drug Praluent in an agreement with Express Scripts, securing exclusive placement on the major pharmacy benefit manager's national formulary in an effort to boost patient access to the medicine.
• The deal is the first since the drugmakers signaled in March willingness to cut Praluent's price if payers agreed to drop barriers that have to date slowed uptake of the PCSK9 inhibitor.
• In exchange for greater rebates on the drug, Express Scripts will also simplify the documentation needed to gain coverage for a prescription, easing current requirements that typically ask doctors to provide detailed patient histories and lab results.

Dive Insight:

While it's tempting to see the deal with Express Scripts as evidence of a changing drug pricing landscape, Regeneron and Sanofi's new price flexibility is also borne out of significant commercial challenges that have weighed on sales of Praluent (alirocumab).

Both Praluent and Amgen's rival cholesterol-lowering drug Repatha (evolocumab) entered the market just months apart carrying similar $14,000 annual price tags. Expectations of fast sales were quickly dashed, however, as payers threw up hurdles to limit coverage to only those patients at highest risk.

Repatha has since captured the majority of market share in the U.S., boosted by clinical results released last year that showed the PCSK9 inhibitor helped reduce cardiovascular risk. According to data from Iqvia cited by Cowen, 66% of new PCSK9 prescriptions were written for Repatha during the week ended April 20.

Regeneron and Sanofi's offer to lower Praluent's price was announced in conjunction with outcomes data that showed a similar cardio-protective benefit as Repatha (although the studies are not directly comparable).

Before making the offer, the drugmakers worked with the Institute of Clinical and Economic Review, a watchdog group focused on measuring the cost-effectiveness of new medicines. ICER used the outcomes data to conduct a new assessment of Praluent's value, which indicated a net price of between $4,500 and $8,000 would be cost-effective in certain high-risk patients.

Regeneron and Sanofi's announcement of the deal with Express Scripts did not disclose the new net price the PBM would pay. A report from Reuters, however, cited Express Scripts Chief Medical Officer Steve Miller as indicating the new price to be on the low end of a $4,500 and $6,600 range.

"When a manufacturer is willing to responsibly price an innovative medicine in line with its clinical benefits, payers should reciprocate by removing the hurdles that can prevent patients from getting the drug," said Steven Pearson, president of ICER, in a statement on the news.

The agreement with Express Scripts will take effect on July 1, 2018, and apply to U.S. commercial patients covered under the PBM's National Preferred Formulary — a group numbering about 25 million individuals.

Under the deal, Amgen's Repatha will be shut out of those plans. However, the financial impact may be relatively slight. Roughly 2,000 patients currently on Repatha — or about 6% of all patients on Amgen's drug — will be impacted, according to comments from the drugmaker cited by Mizuho analyst Salim Syed in a May 1 note to investors.

Express Scripts will also pass on a portion of the rebates given by Regeneron and Sanofi directly to patients on Praluent, potentially resulting in lower out-of-pocket patient costs.

Sanofi CEO Olivier Brandicourt recently indicated the drugmakers were in "active discussions with a number of payers" to strike similar deals.