Senators to question Merck, J&J and Bristol Myers Squibb CEOs over high U.S. drug pricing

Sen. Bernie Sanders, left, seems at a information convention with Sen. Ed Markey on issuing subpoenas for pharmaceutical firm CEOs to testify relating to drug costs, within the Capitol, Jan. 25, 2024.

Bill Clark | Cq-roll Call, Inc. | Getty Images

Senators will question the CEOs of Johnson & Johnson, Merck and Bristol Myers Squibb on U.S. drug costs at a hearing Thursday, as lawmakers on either side of the aisle work to rein in high health-care costs for Americans. 

The push to reduce drug costs is a type of uncommon hot-button points that unites the 2 main political events, despite the fact that they usually again completely different approaches. 

Roughly 9 million American adults didn’t take their medicine as prescribed in 2021 due to the high value of medicines, in accordance to a federal survey. Prescription drug costs within the U.S. are additionally greater than 2.5 instances as high as these in different high-income nations, one other federal report confirmed.

The Senate Health, Education, Labor and Pensions Committee says that is very true for a number of the high medicine from J&J, Merck and Bristol Myers Squibb.

The committee’s listening to will start at 10 a.m. ET and embody testimony from J&J CEO Joaquin Duato, Merck CEO Robert Davis and Bristol Myers Squibb CEO Chris Boerner. Duato and Davis had initially declined to appear.

Ahead of the listening to, the committee famous that the three corporations manufacture a number of the most expensive drugs offered within the U.S.: Merck’s immunotherapy drug Keytruda, Bristol Myers Squibb’s blood thinner Eliquis, and J&J’s immunosuppressive treatment Stelara. 

Sen. Bernie Sanders, who chairs the Senate Health panel, hopes the listening to may bear fruit for Americans, particularly after Eli Lilly’s CEO promised not to raise the costs of the corporate’s insulin merchandise throughout an identical listening to in May. 

A Merck spokesperson advised CNBC in January that the corporate hopes that “this will likely be a productive listening to aimed toward enhancing the committee’s understanding of the pharmaceutical trade and discovering frequent sense options to the challenges dealing with sufferers.”

A spokesperson for J&J advised CNBC in January that the corporate seems ahead to “constructing an understanding of our longstanding efforts to enhance affordability and entry to medicines.”

A spokesperson for Bristol Myers Squibb didn’t instantly reply to a request for remark forward of the listening to.

Annual drug prices, launch costs and patents

In a report launched Tuesday, the Senate committee stated the present annual value of Keytruda is $191,000 within the U.S. however considerably decrease in Germany, at $89,000, and in Japan, at $44,000. 

The panel’s report cited drug pricing and reimbursement knowledge from NAVLIN, a drug value database. The prices mirrored are listing costs of the medicine earlier than insurance coverage and different rebates. 

The report additionally famous that Keytruda’s annual value has elevated over time: It was $147,000 in 2015, the primary full yr the drug was in the marketplace. 

Meanwhile, the present annual value of Eliquis is $7,100 within the U.S. however simply $940 in Japan and $770 in Germany, in accordance to the report. Bristol Myers Squibb started promoting the therapy in 2013 for $3,100 within the U.S. and $1,000 in Japan. 

The report stated the present annual value of Stelara is $79,000 within the U.S., whereas it is $14,000 in Japan and $30,000 in Germany. 

The three drugmakers “start by setting exorbitant costs for brand new medicine,” the panel wrote in its report. “Then, as sufferers come to depend on these medicine, these corporations increase costs, forcing sufferers to pay extra or abandon ongoing therapy.”

The report additionally highlighted methods that the committee stated J&J, Merck and Bristol Myers Squibb have been utilizing to “protect their pricing energy by any means needed.” That contains submitting extra patents on the identical drugs to lengthen its exclusivity, barring cheaper copycats from getting into the market. 

Merck holds 64 lively patents and 51 pending patents on Keytruda, in accordance to the report, which cited a database referred to as the I-MAK Drug Patent Book. 

Johnson & Johnson presently has 15 lively patents and 21 pending patents on Stelara. Meanwhile, Bristol Myers Squibb holds 18 lively patents and two pending patents on Eliquis.

List costs are additionally rising for brand new medicine that the three corporations roll out, the report stated. 

From 2004 to 2008, the median launch value of recent pharmaceuticals offered by J&J, Merck and Bristol Myers Squibb was greater than $14,000. But over the previous 5 years, the median launch value of recent medicine offered by these corporations was greater than $238,000. 

The report additionally stated that J&J and Bristol Myers Squibb every spent $3.2 billion extra on inventory buybacks, dividends and govt compensation than they did on analysis and improvement for locating new medicine in 2022. Merck, nevertheless, spent much less on govt compensation than on R&D that yr, the report stated.

Notably, a number of the high medicine from the three corporations will likely be topic to the primary spherical of Medicare drug value negotiations, a key coverage beneath the Inflation Reduction Act that goals to make expensive medicines extra inexpensive for seniors. That contains Eliquis, Stelara and Merck’s diabetes drug Januvia. 

J&J, Merck and Bristol Myers Squibb are all suing to halt the negotiations, which is able to set up new costs to take impact in 2026.

Don’t miss these tales from CNBC PRO:

Source link

Related Post

Leave a Reply

Your email address will not be published. Required fields are marked *