Regeneron CEO says drug price critique by independent group unscientific

NEW YORK (Reuters) - Regeneron Pharmaceuticals Chief Executive Leonard Schleifer on Thursday took aim at an influential drug pricing watchdog, saying a critique of the company’s new cholesterol lowering therapy was non-scientific.

The Boston-based Institute for Clinical and Economic Review (ICER) last fall reviewed two new potent cholesterol drugs called PCSK9 inhibitors. It concluded that the treatments should cost about 67 percent less than the list prices set by Regeneron with partner Sanofi, and by Amgen Inc.

Health insurers have refused to cover the cost of the treatments in most cases, intensifying a high-profile fight over rising drug prices. ICER began doing value-based analyses last year with a review of new hepatitis C drugs, and has become a prominent voice casting doubt on the price and value of medications.

Schleifer emphasized the importance of value-based drug pricing. On Wednesday, health insurer Cigna Corp said it had reached new reimbursement contracts for the cholesterol medicines based on how well they perform for patients.

Speaking at the Financial Times U.S. Healthcare & Life Sciences Summit, Schleifer said ICER’s method, which reduced the value of the treatments based on its assumption of what the United States could afford, lacked scientific basis.

“They did all the calculations and they said it’s X, which is ok. I could have lived with that. But ... they said society can’t afford X, so we are going to say it’s one-third X,” Schleifer said during a panel discussion.

“They had value-based pricing, but they just decided that well we can’t afford it. That wasn’t scientific. There was no intellectual honesty there.”

ICER Chief Operating Officer Sarah Emond, on a panel with Schleifer, countered that budget impact is part of the equation.

“You’re attacking the science of an independent non-profit whose entire mission is tied to opening the black box of pricing,” she said.

Insurers and the government say value-based pricing can help keep drug prices from climbing too fast. Johnson & Johnson CEO Alex Gorsky said at the conference that it is “incumbent upon our industry to make sure we are moving towards more outcomes based models.”

The new cholesterol fighters were approved for patients with a hereditary form of extreme high cholesterol and those with heart disease. Clinical data designed to show whether they can reduce the risk of heart attack and death in addition to lowering cholesterol are expected late this year and could help expand their reach to more patients.

Reporting by Caroline Humer; Editing by Diane Craft