February 14, 2017

Backlash over $89,000 price tag prompts Marathon to delay drug's launch

Daily Briefing

    Marathon Pharmaceuticals CEO Jeffrey Aronin on Monday announced the company would delay the launch of its newly approved drug deflazacort, known under the brand name Emflaza, amid backlash over the drug's proposed list price.

    Background: FDA approves Emflaza to treat Duchenne muscular dystrophy

    FDA on Thursday approved Emflaza for sale in the United States to treat Duchenne muscular dystrophy.

    Duchenne muscular dystrophy is caused by the absence of the protein dystrophin, which protects against muscle deterioration. Individuals with the disease typically lose the ability to walk during their teenage years. The disease also can lead to severe cardiac problems. Individuals with the disease commonly need wheelchairs in their teenage years and die by their late 20s.

    FDA approved Emflaza tablets and oral suspension to treat Duchenne muscular dystrophy in patients ages 5 and older. According to FDA, Emflaza has been shown to help individuals improve muscle strength.

    FDA also granted Emflaza orphan drug designation, meaning FDA will not approve another version of the drug during that seven-year period even if the company's patent expires.

    Following the drug's approval, Marathon announced that it would set Emflaza's list price at $89,000 for a year's supply. Marathon CFO Babar Ghias had said the company planned to begin selling the drug in March.

    According to the Washington Post's "Wonkblog," the steroid prednisone already is available in the United States to treat Duchenne muscular dystrophy. However, Craig McDonald, a professor at the University of California-Davis who treats patients with Duchenne muscular dystrophy, said Emflaza's milder side effects are appealing to patients.

    Stakeholders, lawmakers express price concerns

    Stakeholders immediately criticized Marathon's proposed list price for Emflaza.

    Patient advocates said Emflaza's proposed $89,000 price tag was between 50 to 70 times higher than what U.S. patients pay to import the drug from an online pharmacy in the United Kingdom, where it is sold as Calcort. The drug was approved for sale in the United Kingdom in 2008, and according to "Wonkblog," patients can import the drug for an annual price of about $1,200.

    However, a spokesperson for Masters Specialty Pharma, which operates the U.K.-based online pharmacy, recently said the company will no longer ship the drug to the United States because FDA regulations bar patients from importing drugs from other countries except under limited circumstances, such as when a drug is not available in the United States.

    Pat Furlong, president of the patient advocacy group Parent Project Muscular Dystrophy, said, "I worry about what people have to pay out of pocket."

    Aaron Kesselheim, an associate professor of medicine at Harvard Medical School, said Emflaza's proposed list price "seem[ed] to be another example of gaming the Orphan Drug Act, which was intended to try and encourage research into new therapeutic entities for people who have rare diseases."

    This leukemia drug's price soared by $80,000 since 2012. Lawmakers wants to know why.

    Rep. Elijah Cummings (D-Md.) and Sen. Bernie Sanders (I-Vt.) in a letter sent to Marathon on Monday asked the company for details on its "outrageous plan" to charge $89,000 for a year's supply of Emflaza. The lawmakers requested information on:

    • Communications Marathon has had with health insurers about covering the drug;
    • How much Marathon spent on developing the drug; and
    • Marathon's profit and revenue projections for the drug.

    The lawmakers also accused Marathon of taking advantage of the orphan drug program "to sell what should be a widely available drug" for such a high price. They wrote, "We urge you to significantly lower your price for this drug before it goes on the market."

    Rep. Robert Aderholt (R-Ala.) also questioned Marathon's use of the orphan drug program, adding that the events make him "question whether the current construct of how FDA approves orphan drugs does more harm than good if companies have found a way to game the system."

    Marathon says it will delay Emflaza's launch

    Ghias, Marathon's CFO, initially defended Marathon's list price for Emflaza, saying more patients would have access to the drug because health insurance companies in the United States now will be able to cover the medication. In addition, Ghias said Marathon would offer patient financial aid programs and discounts on the drug to government insurers. As a result, Marathon estimated that it would receive only about 61 percent of Emflaza's list price, or about $54,000 for a year's supply.

    AMA calls for value-based drug pricing

    However, Aronin, the company's CEO, later said Marathon would delay Emflaza's launch amid "concerns about how the pricing and reimbursement details will affect individual patients and caregivers." The company said it would "meet with Duchenne community leaders and explain our commercialization plans, review their concerns, discuss all options, and move forward with commercialization based on the resulting plan of action."

    In addition, the company said it would continue offerings its "Expanded Access Program," which allows about 800 patients to get Emflaza from the company. Marathon also said that it will allow other patients "currently receiving deflazacort from other sources" to access the program.

    (Walker/Pulliam, Wall Street Journal, 2/13; Walker, Wall Street Journal, 2/10; FDA release, 2/9; Johnson, "Wonkblog," Washington Post, 2/10; Nather, "Vitals," Axios, 2/10; Tribble/Lupkin, Kaiser Health News, 2/13; Clarke, Reuters, 2/13; Marathon Pharmaceuticals release, 2/13; Preston, Med City News, 2/9).

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