Exorbitant Drug Costs May Price Out Patients
`
`Page 1 of 3
`
`
`
`The Washington
`
`0 I
`Dip omat
`
`.
`
`Exorbitant Drug Costs May Price Out Patients
`
`[.:lPr'”**“'SPa9e
`
`By by Gina Shaw
`
`Uploaded on April 27, 2011
`
`In January, an injectable form of the drug progesterone, a synthetic hormone used to prevent preterm labor in some
`
`130,000 pregnant women every year, cost as little as $10 from your local pharmacy.
`
`Just three months later, the same drug skyrocketed to
`
`’,.,
`
`‘
`
`..
`
`$1,500 per dose — although after a public outcry, the
`price tag dropped to $690 per dose. That's still a 69-
`
`'
`
`fold price increase. Why? Did the drug magically get
`better? Did manufacturers discover a brand new
`
`“$1523
`«I '
`=..-Igfi
`
`M.
`,,,r
`
`.
`
`indication? Nope.
`
`is a sterile injectable drug, granting specific approval to _.:l'|I-n- _
`
`The Food and Drug Administration granted exclusive
`
`approval to KV Pharmaceutical to produce the drug
`
`under the brand name Makena, designating it an
`
`"orphan drug" with seven years of monopoly
`protection. The agency decided that because the drug
`
`a manufacturer under FDA guidelines would offer a
`greater assurance of safety.
`
`‘Photo; Bigstock
`'
`_
`"
`'
`Drug companies often claim that the high prices ofmedicattons
`are necessary to compensate for the enormous cost of bnnging a
`
`Originally, KV planned to charge $1,500 per dose for
`the drug — which, if injected every week for the
`
`drug to market, but that doesn't explain why otder drugs, whose
`prices shoutcl have already been calcutated to cover those costs,
`
`recommended 20 weeks, would have cost a whopping
`$30,000 per at—risl< pregnancy. But after an uproar, the
`
`St. Louis-based company brought the price down to
`
`soar in price when a new drug enters the market.
`
`what it apparently thinks is a much more reasonable $690. It also noted that it will expand its financial aid program so that
`
`85 percent of women who need the drug will pay no more than $15 per dose, according to a company statement.
`
`But the $690 price tag is still prettyjaw dropping, especially given that KV didn't pay a dime to develop Makena — the
`
`initial clinical trials were taxpayer—funded through the National Institute of Child Health and Human Development (NICHD)
`at the National Institutes of Health.
`
`"This stuff is really cheap to make — this would be as if a brand new company somehow got a patent on Tylenol or aspirin
`and decided to sell it at $100 a pill," Dr. Christopher Harman, director of the Center for Advanced Fetal Care and chief of
`obstetrics and gynecology at the University of Maryland Medical Center in Baltimore, told Internal Medicine News. He
`
`found the price hike a particular outrage because the women at highest risk of premature birth — young African American
`women — may be the least able to afford it.
`
`http://www.washdiplomatcom/index.php'?view=artic1e&catid=1473 %3Amay-201 1&id=7...
`
`1/26/2016
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 1
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 1
`
`

`
`Exorbitant Drug Costs May Price Out Patients
`
`Page 2' of 3
`
`The FDA has said that companies who were making the progesterone injections previously can still market their drugs as a
`generic, contradicting a letter sent by KV to compounding pharmacies telling them that the FDA would enforce their
`exclusive right to make the drug.
`
`Progesterone injections are far from the first drug to take a sudden and startling trajectory upward in price. Last fall,
`
`Novartis introduced a drug called fingolimod (Gilenya), the first oral medication for multiple sclerosis. The sticker price on
`this medication was startling enough: $48,000 a year, far more than some people's annual salaries.
`
`But this was the first drug of its kind, with no direct competitors. Maybe the premium wasn't all that surprising — until other
`
`multiple sclerosis drugs, many long on the market, suddenlyjoined the band wagon and started going up in price as well.
`
`Copaxone, manufactured by Teva, now costs more than $42,000 per year, nearly 40 percent more than its price at the
`beginning of 2010. Another company, Biogen ldec, has also raised prices for two other MS drugs, Tysabri and Avonex,
`though not as much as the Copaxone hike.
`
`Drug companies often claim that the high prices of medications are necessary to compensate for the enormous cost of
`
`bringing a drug to market (estimated at around $1 billion over about nine years). But why should older drugs, whose prices
`should have already been calculated to cover those costs, go up in price when a new drug enters the market?
`
`Dr. Edward Fox, clinical associate professor of neurology at the University of Texas Medical Branch and director ofthe MS
`
`Clinic of Central Texas, thinks it's all about painting a competitive picture. "With the onset of new medications that come at
`
`a premium, companies have raised the price of older medications in order not to appear inferior to the new drug. They look
`
`at the price as being meaningful when it comes to expectations. If a certain drug is priced lowest, it must be less worthy
`somehow."
`
`Given the high cost of medications for multiple sclerosis and drugs for conditions like cancer, it's almost impossible to get
`
`them without either having excellent insurance, or being in such dire financial straits that you qualify for a drug company's
`"compassionate access" program.
`
`But as prices leap ever higher, even "good" insurance and assistance programs are leaving many people behind.
`Insurance plans are raising co—pays to compensate for the new sky—high drug costs. "On a weekly basis, I'm dealing with
`
`patients who have what I would call a medication crisis," Fox said. "Many of my patients have co—pays of between $300
`and $800 a month. There aren't too many families who can easily absorb that cost."
`
`And with prices increasing at exponential rates, the income thresholds set by drug manufacturers to enter their
`
`compassionate access programs will also need to be higher and higher to assist the growing number of people who are
`greatly burdened by the cost of their medications.
`
`What's the answer? Many physicians who are watching their patients struggle to afford their medications — and spending
`too much of their time appealing insurance company denials of ever-more expensive drug coverage — say that the
`government needs to step in.
`''I've always felt that when a medication is approved and a price is set, it should be set
`
`across the board," said Fox. ''I‘m a free-market supporter, but I do not believe in differential pricing of medications for
`
`different health care plans. tfit's got a price, it should be the same for Medicare, Blue Cross, Tricare, whatever. lfyou do
`that, and it's truly transparent pricing, companies are more likely to compete with one another in terms of reasonable
`prrcrng."
`
`In return, Fox says, drug companies should be given a longer effective patent life for their medications (at least, the ones
`
`they actually developed themselves). Currently, the patent life for a new drug is 20 years — but that begins on the date of
`the patent application. Drugs are usually patented before the FDA approval process, which can take many years. As a
`
`result, the effective life of the patent is often less than 10 years. "The patent clock shouldn't start ticking until approval," Fox
`
`http://Wwwwashdiplomat.com/index.php‘?view=artic1e&catid=1473%3Amay—201 1&id=7...
`
`1/26/2016
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 2
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 2
`
`

`
`Exorbitant Drug Costs May Price Out Patients
`
`Page 3 of 3
`
`suggested. "lf drug manufacturers had a longer and more predictable patent life, they'd better be able to predict profitability
`for a certain drug, and might be willing to accept price controls."
`
`But something has to be done, and soon, Fox said. "We've reached a boiling point. My patients are afraid that they won't
`be able to get the medications that have made a huge difference in their lives."
`
`About the Author
`
`Gina Shaw is the medical writer for The Washington Diplomat.
`
`Last Edited on June 24,2014
`
`http://www.washdip1om at.com/index.php?vievFarticIe&catid=1473 °/u3Amay-20 1 1&id=7...
`
`1/26/2016
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 3
`
`MYLAN PHARMS. INC. EXHIBIT 1074 PAGE 3