May 11, 2016 / 1:10 PM / 3 years ago

Cigna makes deals with Amgen, Sanofi for pricey cholesterol drugs

NEW YORK (Reuters) - Cigna Corp signed deals that will pay the makers of two potent but pricey cholesterol-lowering treatments based on how well their customers respond to the medications, the health insurer said on Wednesday.

An Amgen sign is seen at the company's office in South San Francisco, California October 21, 2013. REUTERS/Robert Galbraith

The treatments, Repatha from Amgen Inc and Praluent sold by Regeneron Pharmaceuticals Inc and Sanofi, hit the market last summer with a list price of more than $14,000 per year. They were approved for patients unable to tolerate or who are not able to adequately control “bad” LDL cholesterol with statins, such as Lipitor, the most commonly prescribed drugs for cholesterol. Statins typically cost only hundreds of dollars a year.

The deals are the highest profile examples to date of insurers basing payments on how well medicines perform for patients. Cigna and Aetna Inc signed deals this year for Entresto, a heart failure drug from Novartis that had slow sales because of its high price.

With no price controls on prescription medicines in the United States, as they have in Europe and elsewhere, insurers and pharmacy benefit managers (PBMs) have become far more aggressive in demanding price discounts and limiting access to expensive new medicines.

Under the new agreements, if customers do not reduce LDL to levels seen in clinical trials, the drugmakers will further discount the cost. If the treatments meet or exceed anticipated cholesterol reduction, the negotiated price remains in place, Cigna said.

Cigna declined to disclose the prices negotiated, or level of LDL reduction it will use to determine if further discounts are in order. In extensive clinical trials, the drugs reduced LDL by 60 percent or more.

Regeneron’s head of commercial operations, Robert Terifay, said he expects insurers to increasingly use value analyses to determine payment for chronic conditions, including asthma and heart disease.

He said Regeneron had signed deals with other payers to assess the value of Praluent, but declined to identify them.

The drugmakers have reported meager sales of Repatha and Praluent, injectable biotech drugs called PCSK9 inhibitors, as insurers have been slow to approve customers seeking the treatments.

Amgen last month said some three-quarters of Repatha prescriptions have been denied, and doctors have expressed frustration over the barriers to getting the new medicines to patients.

“We continue to work with payers to help them see the unintended consequences of an onerous system, resulting in patients with high LDL levels not getting access to Repatha,” Amgen said in a statement.

Cigna has a process in place “that ensures timely access to these very important breakthrough medications for the population that really needs these medications, while ensuring that there isn’t a lot of inappropriate or unnecessary utilization,” Chris Bradbury, senior vice president of Cigna Pharmacy, said in an interview.

Some reimbursement barriers are expected to be removed if large ongoing trials demonstrate that the drugs prevent heart attacks and deaths in addition to dramatically lowering LDL. The first of those results are expected later this year.

Aetna said it chose not to engage in a similar performance-based reimbursement arrangement at this time. “As more cardiovascular outcomes data becomes available, we’ll revisit our options,” Aetna spokesman T.J. Crawford said.

Cigna said it will analyze integrated medical and pharmacy claims data to determine if its customers treated with PCSK9s experience cardiovascular improvements to get a sense of the drugs’ benefits outside of the clinical trial setting.

It will look for reductions in heart attacks and strokes, for example, Bradbury said.

Cigna is seeking to understand the level of medical cost avoidance in order to determine “a fair market value for the price of the drugs,” Bradbury said.

Amgen shares closed down nearly 2 percent on Wednesday, while Regeneron shares fell 3.6 percent, both on Nasdaq.

Additional reporting by Ransdell Pierson; editing by Alan Crosby and Diane Craft

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