The Alliance

The Weekly Dose | 06.07.19

June 7, 2019 3:51 pm

APMI’s mission over the last several months has been to provide additional context to the debate about drug pricing and innovation. These issues, as we have said numerous times before, aren’t easily translatable on social media, or in 30-second ads. One of the issues we’ve tried to address is patents, and the allegation – made by John and Laura Arnold-funded groups – that so-called secondary patents are of little value. This week we ran across two columns that do a nice job of debunking that myth.

First, as Pacific Research Institute Senior Fellow Wayne Winegarden explains at Forbes, innovation doesn’t stop once a drug hits the market. Just like Apple continues to work to improve its products, so do drug manufacturers. Second is a column by Merrill Matthews in The Dallas Morning News that explains when the patent countdown clock actually starts. We know most observers will be surprised to learn it’s well before a treatment comes to market.

If you have questions about the patent system, email us. We look forward to working with you.


Patrick O’Connor – Executive Director

Rosemarie Calabro Tully – Communications Director



 “#Sicklecell disease in particular has been an area where drug development has lagged. This gave us a sense of purpose & a sense of mission.” Biotech companies like @GBT_news are driven by a desire to improve the lives of #patients. Watch the full video: Click here to retweet.

“There are drugs where the cost of the #drug is decreasing over time and yet the prices charged by the #PBMs have been increasing during that same time period.” - @Mass_HPC Executive Director @DMSeltz There’s more to the supply chain than just list prices. Click here to retweet.

Prices in #drug ads won't address #patient costs. Why? What you pay OOP depends on many factors, such as whether you have insurance, what your copayments/deductibles are, whether the drug is on your plan’s formulary & if there’s a #PBM involved. Read: Click here to retweet.



Arnold-Supported Bill Would Benefit Arnold-Supported Group. The Boston Globe reported this week that the John and Laura Arnold-funded Patients for Affordable Drugs Now will spend “hundreds of thousands of dollars to sway lawmakers” to support legislation that would allow Massachusetts to negotiate Medicaid drug prices. The legislation, it turns out, could benefit another group funded by the Arnolds. Read the full blog post here.

In case you missed them, here are some other recent posts on the APMI blog:

 - What Is A PBM?

 - Truth Behind The Buzzwords

 - The Worth Of A Thing Is What It Will Bring



 What It Takes To Innovate. In a GeekWire podcast, brothers Chad and Harlan Robins discuss their company, Adaptive, and its efforts to use the “genetic code of the immune system in an effort to transform the diagnosis and treatment of disease.” The two explain the company’s “efforts will most likely take years to come to fruition — if they ever do.” Specifically, GeekWire says, “The company’s diagnostic efforts with Microsoft are built on new technology and may not pan out. And Adaptive’s deal with Genentech involves creating novel personalized cancer therapies, which will require years of effort and significant expense.”

Big Picture: Zolgensma Is Not A Million Dollar Treatment, It’s A Cure. The Motley Fool explains why Zolgensma, the world’s most expensive drug, is the world’s most expensive drug. It boils down to this, said AveXis President David Lennon: “We’re talking about a lifetime of benefit being condensed down into a one-time treatment. … We’re not used to thinking about this that way. We’re used to a system of a chronic medication where we spread things out over years if not decades.” In other words, the drug is a cure for a defect that ends in certain death for most patients before they reach toddlerhood. Unconvinced? Read this article from STAT News.

New Hope For Patients With Lung Cancer. Reuters reported early this week that “nearly a quarter of patients who received Merck & Co’s immunotherapy Keytruda as an initial treatment for advanced lung cancer were still alive after five years, according to data presented at a major medical meeting on Saturday.” Additionally, STAT News noted Amgen has “showed it had developed a medicine that shrank tumors in 50 percent of lung cancer patients. These lung cancer patients — just 10 of them because this is an early-stage clinical trial — all had tumors that tested positive for a particular mutation in KRAS, a cell-signaling protein.”

New Hope For Young Women With Breast Cancer. STAT News reports “Kisqali, a breast cancer drug from Novartis (NVS), dramatically extended survival in younger women who developed the most common form of breast cancer. In women with hormone receptor positive/HER2 negative breast cancer who were premenopausal, adding Kisqali to hormone-blocking therapy resulted in a 29 percent reduction in the risk of death.”

 PBMs Cost New York Taxpayers At Least $300 Million. A new report by the New York state Senate Committee on Investigations and Government Operations criticizes pharmacy benefit managers (PBMs) and calls for reform. Particularly problematic, according to the Albany Times Union, is spread pricing, “a practice where a PBM charges a health plan more for a drug than it reimburses a pharmacy, and profits off the difference.” The Times Union notes a 2018 study by the Pharmacists Society of the State of New York found spread pricing “on New York’s Medicaid managed care prescriptions cost taxpayers over $300 million.” (According to ModernHealthcare, a Massachusetts report also found PBMs cost taxpayers money.) Writing in Morning Consult, pharmacy owner Steve Moore says New York could save at least $45 million by implementing legislation to rein in spread pricing. Meanwhile, in The Hill, Liam Sigaud from the American Consumer Institute reports a new survey finds American consumers support efforts to improve PBM transparency.



Nearly 90 percent of drug trials fail. When they do, it devastates patients, doctors … and the men and women working to develop a new cure. Al Sandrock, chief medical officer at Biogen, in STAT News, describes what it is like when a drug you’ve worked on and invested in for years, does not produce the results you had hoped for:

“As soon as I walked in and I saw their faces I knew it wasn’t good … This was a very sad moment, very grave.”



Tuesday, June 11, 2:30 p.m.: Senate Judiciary Committee, Subcommittee on Intellectual Property Hearing

Location: Dirksen Senate Office Building, Room 226

Topic: “The State of Patent Eligibility in America: Part III”

Witnesses: Three different panels with a wide range of witnesses from varying sectors

Contact: 202-224-5225



Wednesday, June 12, 10 a.m.: House Ways and Means Committee Hearing

Location: Longworth House Office Building, Room 1100

Topic: “Pathways to Universal Health Coverage”

Witnesses: TBA

Contact: 202-225-3625



Wednesday, June 12, 10 a.m.: House Energy and Commerce Committee, Subcommittee on Health Hearing

Location: Rayburn House Office Building, Room 2123

Topic: “No More Surprises: Protecting Patients from Surprise Medical Bills”

Witnesses: TBA

Contact: 202-225-3641



Wednesday, June 12 – 2:30 p.m.: Senate Judiciary Committee, Subcommittee on Antitrust, Competition Policy, and Consumer Rights Hearing

Location: Dirksen Senate Office Building, Room 226

Topic: “Your Doctor/Pharmacist/Insurer Will See You Now: Competitive Implications of Vertical Consolidation in the Healthcare Industry”


 - Professor Craig Garthwaite, Kellogg School Of Management, Northwestern University

 - Professor Thomas Greaney, College Of The Law, UC Hastings

 - Cory Capps, Partner, Bates White Economic Consulting

 - Fiona M. Scott Morton, Ph.D., Theodore Nierenberg Professor Of Economics, Yale School of Management

Contact: 202-224-5225



Thursday, June 20, 2 p.m.: Information Technology and Innovation Foundation

Location: Russell Senate Office Building, Room 385

Topic: The Cost of Cures: Drug Price Controls vs. Biopharmaceutical Innovation

Agenda: There is an increasingly intense focus in Washington on reducing the price of drugs to bring down health-care costs. President Trump has proposed a plan that would use an international pricing index model for drugs under Medicare Part B. There are proposals from both sides of the aisle in Congress as well including various forms of government-led arbitration and changes to U.S. patent laws. But much of this debate is taking place without systematic consideration of what effect, if any, mandated drug-price reductions would have on biopharmaceutical innovation and U.S. industry competitiveness.