July 20, 2018 / 12:57 PM / 5 months ago

Swiss, German drugmakers join U.S. price freeze

* Swiss, German firms join in the U.S. drug price freeze

* Trump thanked U.S. drugmakers for halting prices in Tweet

* Swiss drugmaker says long-term reforms needed

By John Miller

ZURICH, July 20 (Reuters) - Roche, Bayer and Germany’s Merck KGaA became the latest drug companies to freeze prices in the United States, amid increased scrutiny by the Trump administration of medicine costs.

Roche, Bayer and Merck KGaA all said on Friday they would not seek to lift prices this year in the world’s biggest drug market, following Novartis, Pfizer and U.S. drugmaker Merck which had already announced similar moves.

U.S. President Donald Trump made lowering prescription drug prices a top 2016 presidential campaign issue and has criticised drugmakers for raising prices, saying in a tweet this month that they “should be ashamed”.

“Last week on July 11, we communicated to the U.S. Department of Health and Human Services (HHS) that we will not be taking any price increases for the remainder of the year,” Switzerland’s Roche said in a statement on Friday.

“We take decisions related to the prices of our medicines very seriously and our commitment to patient access and investment in future breakthroughs are reflected in our actions.”

Germany’s Merck KGaA also relented to pressure.

“We make our own independent pricing decisions and currently plan no price increases in the U.S. for the remainder of 2018,” the company said in an emailed statement.

Germany’s Bayer said it had also told U.S. health ministry officials that it will not raise prices this year.

THE BIG FREEZE

Novartis Chief Executive Vas Narasimhan called off price hikes in June, and this week cited the “dynamic environment” in the U.S. in tackling drug costs as a reason.

Trump called Pfizer’s boss, CEO Ian Read, after his company raised prices on July 1. The U.S. drugmaker reversed course after the president complained its hike was interfering with his administration’s drug pricing plan.

Trump, who has accused drugmakers of “getting away with murder”, thanked Novartis and Pfizer in a tweet this week.

New Jersey-based Merck & Co. announced price cuts on Thursday to some of its medicines, including a hepatitis C treatment and six medicines, though the overall impact may be muted since affected medicines have tiny market shares.

It also said it would not increase the average net price of other medicines in its portfolio of products by more than the inflation rate annually.

Roche said freezing prices this year was a measure to keep a lid on prices, saying its last seven new medicines were priced at a discount to rivals’ existing drugs.

In 2017 it priced Ocrevus at $65,000 annually, undercutting German rival Merck KGaA's Rebif by a quarter even though Ocrevus beat Rebif in a trial. [reut.rs/2uBLGnC ]

“We recently priced...Hemlibra at less than half the cost of the standard treatment for hemophilia A with inhibitors,” Roche said in its statement, adding that what was really needed were “long-term, system-wide solutions that lower costs, while sustaining scientific innovation.”

With his plan to cut drug prices, Trump has vowed to target “middlemen” in the drug industry - an apparent reference to health insurers and pharmacy benefit managers - but has retreated from ideas like letting the government’s Medicare plan for older Americans negotiate prices directly with drugmakers or allowing imports of cheaper drugs.

Drugmakers including Roche and Novartis favour reforms to Medicare’s discount drug programme, saying the federal programme originally designed to stretch resources has grown inappropriately. Some U.S. hospitals that benefit oppose changes. (Reporting by John Miller; additional reporting by Patricia Weiss in Frankfurt Editing by Susan Fenton)

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