Repatha and Praluent Launches Earn Praise From Express Scripts; Will Investors Applaud As Well?

The first PCKS9’s aren’t setting any sales records at launch. In the current pricing climate, that is probably a good thing. For now, investors seem to agree.

When the complaints about specialty drug pricing hit a crescendo in 2014, payors stressed that it wasn’t just about hepatitis C drugs. Just wait, they said, until the new wave of cholesterol therapies comes to market.

Well, a year later, the first two therapies in the PCSK9 class have been launched, and it is hard to wonder what the fuss was all about.

The two drugs, marketed by Amgen Inc. (Repatha) and Sanofi/Regeneron Pharmaceuticals Inc. (Praluent), were approved over the summer, and that triggered a round of headlines again, duly noting the “higher than expected” launch prices, of over $14,000 per year.

But what followed has been anything but a replay of them headlines that greeted Gilead Sciences Inc. in 2014 with the launch of the hep C therapy Sovaldi.

For starters, the drugs haven’t exactly blown up any budgets to date. Regeneron reported $4 million in initial sales of Praluent in the third quarter. Amgen didn’t even deem the amount of Repatha sales material and worth breaking out in its quarterly report. And both sponsors are emphasizing to investors that the build-up will be slow.

But the result is that, instead of facing a storm of criticism, the PCSK9 inhibitor sponsors are actually receiving praise from payors.

The immediate spike in uptake of Sovaldi prompted a “going to war” response from payors and the pharmacy benefit management companies—most notably Express Scripts. In contrast, Amgen and Sanofi are earning public praise from Express Scripts Chief Medical Officer Steve Miller, the front-person for the PBM’s sustained attack on Gilead last year.

During a Pew Trust session on specialty drug pricing in Washington on Oct. 5, Miller took a distinctly different tone while describing the PCSK9 launches than he did during a series of DC policy conferences in 2014 focusing on hep C pricing. Miller’s Oct. 5 comments were followed on Oct. 6 with announcement by Express Scripts that both Repatha and Praluent were accepted onto the PBM’s National Preferred Formulary (which serves a total of 75 million lives).

Amgen and Sanofi presumably paid a price (in the form of discounts) for that outcome. However, as simultaneous entrants into a category with a genericized base of treatments, they had little option but to negotiate with Express Scripts and to support efforts to treat restrictively to label on launch.

And Wall Street certainly saw the news as something to celebrate. Regeneron shares jumped more than 5% on October 7, and Amgen was up nearly 5% as well. And no one seemed unduly concerned that initial sales reports were so low when the companies reported at the end of the month – in part because Express Scripts’ decision came after the quarter closed.

All of which suggests that the PCKS9 sponsors have found a formula to curb the flow of negative headlines about high prices: commit to a slow-uptake, controlled launch. And that formula is playing very well in a climate of investor concern about a political response to drug pricing. (Also see "The Campaign Against Drug Pricing: Candidates Can Only Hope Voters React As Strongly As Wall Street" - Pink Sheet, 25 Sep, 2015.)

Express Scripts Praises Sponsors – After Flexing Muscles

Wall Street’s reaction also reflects a sense of relief about what amounted to an abrupt reversal in the narrative about the new products. Early news accounts highlighted Express Scripts in the role of gate-keeper, bragging about its denial of prescriptions that lacked appropriate documentation of prior statin use.

During the Pew session, Miller responded to reports that Express Scripts is blocking 50% of initial PCSK9 scripts by suggesting that it did so with the full support of the manufacturers. “Absolutely…we are doing that in cooperation with both Sanofi and Amgen,” he said.

The companies are working with Express Scripts, Miller said, to avoid “the shiny new toy phenomenon.” He credited “both Amgen and Sanofi in this particular case” with wanting “the right patients on these drugs. They know that there is not the hard, endpoint data that they would like. Until that that is evident, they actually do not want incorrect patient populations treated either.”

Driving home the praise for cooperation a third time, Miller said. “By narrowing use to those who will have the highest value now, we believe we will actually deliver value to the system. And in this particular situation we are getting good cooperation from the manufacturers.”

Miller’s remarks foreshadowed the PBM’s decision to include both therapies on its national formulary – a decision that would once have seemed unremarkable but that drew extensive media coverage given Express Scripts’ aggressive use of non-coverage policies in recent years.

Express Scripts felt confident enough about initial use restrictions to set a cap on first-year cost of both products to the PBM’s customers of $750 million. That leaves plenty of room for both products to reach very strong sales thresholds (given that Express is only a portion of the overall US market) – but it puts the PBM in the position of guaranteeing its customers that the new cholesterol class will not have anywhere near the impact on insurers as the Sovaldi launch.

Express Scripts can be effusive in support for a new product when it has negotiated use restrictions and contracted pricing. So Miller spoke strongly in favor of PCSK9 use for patients with extreme LDL elevation and for previous heart attack patients, acting as product advocate instead of critic.

Miller, for example, asked rhetorically about the appropriateness of use in familial hypercholesterolemia. “No question,” he declared. “FH patients should be on these drugs. They have heart attacks very early on. There is going to be huge value to the entire payer community – looking holistically at payment: not just drug but medical.” Similarly, “those patients who have had a prior heart attack and can’t reach goal, those patients should be on the drug,” he said.

Trumping ICER?

Working with the PBM creates a better position for Amgen and Sanofi to protect list prices in policy debates. That makes the strategy of contracting with the PBM and controlling initial use valuable on two fronts: formulary selection and broader message support.

The current flare-up of attention to drug pricing as a political issue was an inescapable theme at the Pew event. Indeed, headlines from the event highlighted (in distorted fashion) comments by HHS Assistant Secretary for Planning & Evaluation Richard Frank suggesting potential near-term action by the Administration on drug pricing. In that climate, Amgen and Sanofi are well-served by being presented as cooperating with payors on appropriate use. (

At the Pew session, that meant Amgen and Sanofi could argue with estimates on the appropriateness and societal value of the price by the Institute for Clinical & Economic Review (ICER) without facing simultaneous opposition from an antagonistic PBM.

Amgen SVP-Global Value, Access & Policy Josh Ofman cited the measured uptake of the new agents as key element that ICER failed to account for.  There was an “over-estimation of the population size that is going to be eligible for PCSK9s according to the FDA label and also an over-estimation of the uptake of these drugs,” Ofman said.” We believe that these types of assessments need to be as reality–based as possible.”

Ofman noted that ICER put the five-year uptake for PCSK9s in the 25%-75% categories. “Statins, which were the mostly used drugs available on the planet, had 9% uptake. We need to get these assessments more reality-based,” the Amgen exec reiterated.

ICER’s draft report on the new class suggests that the sustainable price point for the drugs is just $2,177 per year (or about 85% below the list price for the first two drugs). The revised draft suggests that a value-based price per patient is a bit higher than in the original draft, but that does not revise the estimated uptake – which in turn suggests the $2,000 sustainable pricing level.

Regeneron Focuses On Advantages Of Outcomes Work

Regeneron VP-Program Direction Bill Sasiela represented the Sanofi/Regeneron team on Praluent at the Pew session.

Sasiela noted the continuation of Praluent trials in the form of the large Odyssey outcomes studies, encompassing 10 trials on different lipid-control segments and 18,000 total patients.  Sasiela said that partnering with managed care could eventually improve adherence to the drug. “We agree that the value comes from continuing to take medication – not from taking it for six months and stopping.”

A slow uptake for the new cholesterol-lowering injectables also fits with evolving cardiology practice patterns. Miller noted that “the cardiology community has actually been phenomenally responsive so far: it has been very slow in putting patients on the drug.”

The Express Scripts exec observed also that the types of scripts being denied were often short of adequate supporting information. “Many doctors cannot even tell us what the LDL is on the patient,” Miller claimed. “Should we just give that prescription because the doc wants it, without knowing what the baseline LDL is? Should we pay for a patient who has ‘failed statins’ if there is no evidence that he has ever had a statin claim?”

Indiana University School of Medicine professor Richard Kovacs further elaborated on the practice adjustments associated with putting patients on PCSK9s.

Kovacs explained that to start patients on PCSK9 therapy not only takes substantial certification on the doctor’s part but also a training and education program for the patient that is labor-intensive for the medical practice. He noted that doctors are convening specialty sessions and clinics to try to train groups of patients instead of one-on-one.

“Because of the need for education and for answering a lot more questions and for pre-certification, we are really having specialty sessions, specialty clinics,” Kovacs said. The specialists focusing on PCSK9s “are gathering these patients in groups to try to bring them in. They are recognizing that these are intensive sessions.” Kovacs pointed out a problem with the group sessions from the physician’s point of view; “they are not reimbursed by the way.”

Kovacs added that “a relatively few number of practitioners in my practice and in practices around the country are focusing on this therapy – whether they are lipidologists or whether they are preventive cardiologists.” He summarized the fundamental changes to workflow associated with PCSK9 initiation as extensive pre-certification and documentation, patient education, storage and shipping, and medication adherence.

For the certification that patients qualify for PCSK9s, Kovacs noted cardiologists have to deal with genetic testing (for FH), evidence on prior statin use and response (or lack of response), statin intolerance (which needs improved definition) and strategies for adherence to medications and diet.

Investors Are Willing To Be Patient

The messages from sponsors about a slow uptake aren’t just being used to mollify payors or counter adverse publicity about pricing – they are also part of the discussion with investors, and appear to be working well in that setting to manage expectations.

Amgen EVP-Global Commercial Operations Tony Hooper described the Repatha launch during Amgen’s third quarter earnings call October 28. He pronounced the US launch as “off to a good start,” but focused investors squarely on the need to build reimbursement before delivering sales. “Anticipating a period of negotiation for payers post approval we launched the Repatha Ready program,” he said. “This program provides Repatha to appropriate patients if they wish during the insurance verification process, while plans finalize reimbursement and fulfillment pathways.”

The volume of requests for access through that program “is a clear indicator of the unmet need and physician belief in the benefits of Repatha,” Hooper said. He then noted Express Scripts’ coverage announced and added that “we continue to negotiate with other payers to expand access in the United States.”

“However,” he stressed, “we expect payers’ utilization management criteria to remain fairly narrow pending the outcomes data.”

Amgen anticipates completing the outcomes trial in 2016, along with an intravascular ultrasound study. In addition, Amgen has filed a supplement for a once-monthly, single-injection dosing option with a user fee deadline in mid-year.

Regeneron SVP-Commercial Robert Terifay sounded similar themes during that company’s quarterly call November 4.

“Over 4,000 prescribers have submitted prescriptions to MyPRALUENT, our reimbursement and patient services hub,” he said. “As a reminder, the reimbursement environment is complex and will be carefully managed by payers. Our goal has been to ensure that payers and healthcare providers understand the value that Praluent can offer to patients.”

“To that end, we are actively engaged in extensive discussions with payers,” Terifay said. “We expect that it will take several months for some commercial and government payers to conduct formulary reviews, make reimbursement coverage decisions, and to begin processing patient claims. “Given these reasons, we expect an initial gradual uptake at launch.”

Regeneron is also pointing to the outcomes data as a key factor to drive more uptake in the future, and notes that it currently anticipates interim analyses in 2016—one of which takes place after 75% of scheduled events and could trigger a halt of the study if efficacy is strong enough.

That go-slow message is clearly resonating well with payors, and it is helping keep the sponsors out of the headlines in the drug pricing debate. So far, Wall Street is accepting it too. The question is, will investor’s patience pay off? Or wear out?