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By James Swann
Nov. 4 — The Senate Committee on Aging Nov. 4 announced a bipartisan investigation into the price increases for certain off-patent drugs, and focused on four pharmaceutical manufacturers.
The panel sent letters to Valeant Pharmaceuticals, Turing Pharmaceuticals, Retrophin Inc. and Rodelis Therapeutics.
Sen. Susan Collins (R-Maine), who leads the committee along with Sen. Claire McCaskill (D-Mo.), said the investigation was prompted by recent spikes in drug pricing and that the committee “considers these massive price increases worthy of a serious, bipartisan investigation into the causes, impacts, and potential solutions.”
The committee has sent letters to all four companies requesting drug pricing data by Dec. 2, and a hearing on the issue is expected to be held Dec. 9.
The investigation will review recent price increases in off-patent drugs that have been recently acquired by the four companies. The panel also will look into the Food and Drug Administration's process for approving new generic drugs, as well as the recent spate of pharmaceutical mergers and acquisitions.
In a statement e-mailed to Bloomberg BNA Nov. 4, Turing Pharmaceuticals said it was in the process of reviewing the committee's letter and was looking forward to “an open and honest dialogue about drug pricing.”
“We're proud of our patient assistance program which limits out of pocket costs for nearly all patients to $10 per prescription with most receiving Daraprim for $1 or less,” the statement said, referring to a drug that recently had a sharp price increase.
Turing said more than 60 percent of the company's revenue is going toward research and development.
Valeant spokeswoman Laurie Little said the company's drug prices have fluctuated for several reasons, including “the cost of development and acquisition and complexities in the health care cost reimbursement system,” according to a statement e-mailed to Bloomberg BNA Nov. 4.
“The list price of any individual drug typically does not reflect the actual amount paid by a health care provider or insurance company, and Valeant devotes a significant portion of its revenue to patient assistance programs that are designed to make important medicines more affordable to the patients who need them,” Little said.
The Senate announcement came on the same day Democrats on the House Oversight and Government Reform Committee asked Chairman Jason Chaffetz (R-Utah) to investigate drug pricing at Valeant and Turing, or at least not block the Democrats from conducting their own investigation (see related article).
Off-patent drugs, which are the focus of the Senate committee's investigation, have generally been in production for a long time and are no longer protected from competition. While the added competition would in theory lead to price drops, off-patent drugs acquired by the four companies have instead seen sharp price increases.
For example, Valeant increased the price of a recently purchased cardiac arrest drug (Isuprel) by 820 percent, according to the Senate committee's letter to the company, and increased the price of another recently purchased cardiac arrest drug (Nitropress) by 625 percent on the same day it purchased the drug.
Valeant also recently purchased the rights to sell Cuprimine, a drug used to treat Wilson's disease (excess copper in the body), the committee letter said, and increased the price by 2,949 percent.
In addition to the committee's investigation, Valeant received subpoenas from U.S. attorneys in Massachusetts and Manhattan recently, seeking information on the company's drug pricing and distribution strategies (200 HCDR 200, 10/16/15).
Turing Pharmaceuticals also significantly increased the price of Daraprim shortly after acquiring the drug, the committee's letter to the company said.
The price of Daraprim, which is used to treat and prevent infections, went from $13.50 for each tablet to $750, though in September Turing said it would lower the price (185 HCDR, 9/24/15).
The committee letters to the four pharmaceutical companies included requests for:
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