* Cuts injection prices 55 pct
* Will offer supplemental rebates along with list price (Adds comments from industry groups; updates stock)
WASHINGTON, April 1 (Reuters) - K-V Pharmaceutical Co KVa.N slashed the price of its pre-term birth drug, Makena, on Friday following complaints earlier this month by U.S. senators and industry groups about a big price increase.
However, industry groups expressed disappointment with the price cut, saying it was not enough to bridge the gap between the branded drug and similar versions compounded by specialty pharmacies.
The company, which has faced strong opposition since the drug price was announced, cut the list price of Makena by nearly 55 percent to $690 per injection.
“The cost for each pregnancy remains about $7,000 compared with $300 for the compounded drug,” said George Saade, president of the Society for Maternal-Fetal Medicine, a nonprofit group of obstetricians and gynecologists.
“Makena has not been shown to be more effective or safer than the available compounded drug.”
Industry group America’s Health Insurance Plans, which had urged the U.S. Food and Drug Administration to provide clearer guidance on the availability of the cheaper compounded drugs, called Friday’s price cut “a modest step.”
The drug had been available for $10-$20 per injection, but reportedly rose to $1,500 after the Missouri-based company’s version was granted orphan status. [ID:nL3E7EI28M]
The nonprofit organization for pregnancy and baby health, March of Dimes, ended its current contract with K-V and called K-V’s handling of the Makena launch and the list price “highly unsatisfactory and unacceptable.”
Repeated complaints about the dramatic price rise led to the U.S. health regulator announcing on Wednesday that it would take no action against pharmacies that formulate treatments similar to Makena. [ID:nN30136574]
“We understand the concerns that key stakeholders raised under our original pricing structure,” said K-V Pharma Chief Executive Officer Greg Divis. “We also recognize the current budget challenges facing state Medicaid programs and other payers.”
K-V said it will offer supplemental rebates that, in conjunction with the list price reduction and the standard Medicaid rebate of 23.1 percent, will result in a lower cost per injection.
Makena sales are important for K-V, which has been battling several lawsuits and manufacturing issues that led to the company being barred from making drugs. The approval of Makena revived the company’s stock and held the promise of a fresh start.
The company’s shares, which have risen about threefold since the drug received the FDA’s marketing nod in February, were trading down 5.8 percent at $5.64 on Friday afternoon on the New York Stock Exchange. (Reporting by Esha Dey; additional reporting by Krishnakali Sengupta in Bangalore; editing by Robert MacMillan and Andre Grenon)