Bye, Repatha – price cut on Praluent wins exclusive Express Scripts deal

The real question after today’s price-cutting deal between the pharmacy benefit manager Express Scripts and Regeneron/Sanofi over the cholesterol-lowering drug Praluent is: what took them so long?

After all, Amgen already had a one-year headstart on price concessions when data showed that Praluent’s PCSK9 rival Repatha did not achieve the expected reductions in cardiovascular deaths and complications, and there was little reason to believe that Praluent would do any better. Still, however late in coming, the deal has to be considered a coup for the Praluent partners, who can now hope to give life to underperforming sales with an exclusive contract with the biggest US pharmacy benefit manager (PBM).

Not good enough

The path to the lower price has essentially been set by the clinical underperformance of both of these anti-PCSK9 antibodies. Given a profound lowering of LDL of greater than 50% when paired with high-intensity statin use, they were thought capable of reducing cardiovascular events by more than 20%.

In fact, neither Repatha nor Praluent could manage more than 15%, in line with dual treatment of statins and Zetia, so payers have reasonably questioned their $14,000-plus list prices. The independent US evaluator Icer put a value-based price of $2,200 a year on Repatha and $2,300 a year for Praluent in the biggest population, patients with a history of atherosclerotic heart disease and LDL levels of 70mg/dl despite treatment with statins.

The writing was on the wall when Amgen started making “value-based” deals in 2017 after a disappointing data release at the American College of Cardiology meeting, and Regeneron and Sanofi signalled the same following a similar result at the 2018 ACC (ACC – Praluent’s Odyssey ends with a whimper, March 10, 2018).

Still, the announcement today of the exclusive deal should at least give Praluent revenues a short-term boost. Sanofi last week reported lagging first-quarter sales of €49m ($59m), short of a consensus of €59m. Bernstein analyst Ronny Gal said Praluent should become profitable for Regeneron because the group will be able to reduce its investment in sales and marketing.

The upper hand

But he added that Express Scripts’ reduction in the paperwork needed to secure a Praluent prescription, an aspect of the deal that Regeneron was keen to trumpet this morning, might not necessarily speed uptake. “[Express Scripts] knows their business better than Regeneron and will always be able to find other ways to manage utilisation of the drugs,” Mr Gal said in a video distributed to clients.

He said Amgen would likely respond by cutting exclusive deals with other payers, so Regeneron and Sanofi cannot expect any increase in sales from the Express Scripts agreement to translate widely.

Mr Gal described it as a “capitulation” to payers “because [the drug companies] are admitting this will never be a very big [drug] class”.

“This entire class will go exclusive, and as they go exclusive prices will go down,” he said. “When classes go exclusive payers win, drug companies do not; and that is the case here.”

The PCSK9 class will never achieve the lofty $9bn sales number originally attached to it. For better or worse, payers followed through from their warnings of the budget-busting potential with a hard line on utilitsation. The lesson for the rest of the pharma sector should be clear.

To contact the writer of this story email Jonathan Gardner in Virginia at [email protected] or follow @ByJonGardner on Twitter

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