American caravan arrives in Canadian ‘birthplace of insulin’ for cheaper medicine

Type 1 diabetes advocates from the United States depart a Canadian pharmacy after purchasing lower cost insulin in London, Ontario, Canada June 29, 2019. REUTERS/Carlos Osor

By Tyler Choi

TORONTO (Reuters) – A self-declared “caravan” of Americans bused across the Canada-U.S. border on Saturday, seeking affordable prices for insulin and raising awareness of “the insulin price crisis” in the United States.

The group called Caravan to Canada started the journey from Minneapolis, Minnesota on Friday, and stopped at London, Ontario on Saturday, to purchase life-saving type 1 diabetes medication at a pharmacy.

The caravan numbers at approximately 20 people, according to Nicole Smith-Holt, a member of the group. Smith-Holt said her 26-year-old son died in June 2017 because he was forced to ration insulin due to the high cost. This is Smith-Holt’s second time on the caravan.

Caravan to Canada trekked the border in May for the same reasons, which Holt-Smith said was smaller than the group this week. She said Americans have gone to countries like Mexico and Canada for more affordable medications in the past and continue to do so.

The Canadian Broadcasting Corporation reported in May that Canadian pharmacists have seen a “quiet resurgence” in Americans coming to Canada looking for cheaper pharmaceuticals.

Insulin prices in the United States nearly doubled to an average annual cost of $5,705 in 2016 from $2,864 in 2012, according to a study in January.

Allison Nimlos, a Type 1 diabetes advocate from the United States, shows the less expensive Canadian insulin she purchased (right) after leaving a Canadian pharmacy in London, Ontario, Canada June 29, 2019. REUTERS/Carlos Osorio

Allison Nimlos, a Type 1 diabetes advocate from the United States, shows the less expensive Canadian insulin she purchased (right) after leaving a Canadian pharmacy in London, Ontario, Canada June 29, 2019. REUTERS/Carlos Osorio

While not everyone purchased the same amount of insulin, Smith-Holt said most people are saving around $3,000 for three months of insulin, and as a whole, the group is saving around $15,000 to $20,000.

Prescriptions for insulin are not required in Canadian pharmacies Smith-Holt said, but the caravan has them so they can prove to the border patrol they are not intending to resell them when returning to the United States.

Quinn Nystrom, a leader of T1International’s Minnesota chapter, said on May via Twitter that the price of insulin in the United States per vial was $320, while in Canada the same medication under a different name was $30.

T1International, a non-profit that advocates for increased access to type 1 diabetes medication, has described the situation in U.S. as an insulin crisis.

“We know that many people couldn’t make this trip because they cannot afford the costs associated with traveling to another country to buy insulin there,” said Elizabeth Pfiester, the executive director of T1International in a press release.

An itinerary states the caravan will stop at the Banting House in London, Ontario later in the day. The Banting House is where Canadian physician and scientist Frederick Banting, who discovered insulin, lived from 1920 to 1921, and is called the “birthplace of insulin”, according to the Banting House website.

Smith-Holt said the group is not currently planning any future trips, but they could be organized in the near future depending on need. She hopes for long-term solutions in the United States like price caps, anti-gouging laws, patent reform and transparency from pharmaceutical companies.

(Reporting by Tyler Choi, Editing by Franklin Paul)

Toxin at heart of drug recall shows holes in medical safety net

FILE PHOTO: The headquarters of the European Medicines Agency (EMA), is seen in London, Britain, April 25, 2017. REUTERS/Hannah McKay -/File Photo

By Alexandra Harney and Ben Hirschler

SHANGHAI/LONDON (Reuters) – A toxin inadvertently produced in the manufacture of a widely prescribed medicine but not spotted for years raises questions about regulators’ ability to detect risks in a sprawling global drug supply chain increasingly reliant on factories in China.

China’s Zhejiang Huahai Pharmaceutical, which produces bulk ingredients for drugmakers, told its customers in late June it had found NDMA in its valsartan, an off-patent blood pressure drug originally developed by Novartis.

The discovery means that some of the 10 billion pills containing valsartan sold worldwide last year to prevent heart attacks and strokes had traces of N-nitrosodimethylamine (NDMA), classified as a probable human carcinogen. No one has been reported as sickened by the toxin, once used in the production of liquid rocket fuel.

Regulators and industry experts say the toxin almost certainly was introduced when Huahai changed the way it produced valsartan in 2012 – a modification that was signed off on by the European body that sets standards. Subsequent inspections by European, U.S., and Chinese regulators also found no problem.

“Everyone failed – the company, the inspectors, the FDA (U.S. Food and Drug Administration), the Europeans, the Chinese,” said Philippe André, an independent pharmaceutical auditor who inspected two Huahai facilities last August and found no critical concerns. “It’s a system failure.”

Reuters was unable to determine how Huahai first discovered the problem. In a July 7 statement released through the Shanghai Stock Exchange, it said it detected the toxin during the “optimization and evaluation” of its manufacturing process.

A Novartis spokesman told Reuters that its generic drugs arm, Sandoz, spotted the NDMA in the course of intensive testing to prepare for expanding its purchases of valsartan. He declined to comment further, including on the identity of the manufacturer or when the tests took place.

Two other smaller bulk suppliers – Zhejiang Tianyu Pharmaceutical and a unit of India’s Hetero Drugs – have since also discovered traces of NDMA in some of their valsartan.

The three companies declined to comment to comment about the case.

REDUCE WASTE

Huahai said in a document released through the Shanghai Stock Exchange it changed the production process to reduce waste and improve yields.

“The NDMA impurity was produced in trace amounts during the normal manufacturing process according to the company’s current registered process,” it said in a statement on July 24.

“All changes in the company’s valsartan manufacturing process have been approved by each country’s drug regulator, and the company manufactures in compliance with legal and regulatory standards.”

The European Medicines Agency (EMA) regulator, which first publicly raised the alarm in a statement on July 5, told valsartan suppliers in a subsequent memo dated July 16 that the NDMA may have been connected to the combined use of the solvent dimethylformamide and sodium nitrite.

The FDA is also going on that hypothesis, said Janet Woodcock, director of its Center for Drug Evaluation and Research. She stressed the investigation was still going on.

“This (NDMA) was not what you look for in an inspection,” Woodcock said in an interview. “If you don’t test for this you’re not going to have an idea that it’s in there, and you’re not going to see it on an inspection.”

The European Directorate for the Quality of Medicines (EDQM), responsible for setting manufacturing standards, told Reuters it was aware the solvent was being used when it approved the changed process, but that NDMA as a by-product was unexpected and not tested for.

Detecting NDMA would have required gas chromatography coupled with mass spectrometry, a very sensitive level of testing, an EDQM spokeswoman said.

“These techniques are not normally used routinely to test pharmaceutical products,” she said.

RECALLS

Built by Novartis into the $6 billion-a-year brand Diovan, valsartan’s European and U.S. patents expired in 2011 and 2012.

Global sales totaled 10.4 billion pills last year, including combination products, healthcare data consultancy IQVIA estimates. People with high blood pressure typically take one pill daily and heart failure patients two.

More than 50 companies around the world making finished tablets from the tainted valsartan have recalled products in recent weeks, according to a Reuters analysis of national medicines agencies’ records. They include major generic drug manufacturers such as Teva Pharmaceutical Industries, Ranbaxy Laboratories, and Sandoz.

Based on the average NDMA impurity detected at Huahai of 60 parts per million (ppm), the EMA says there could be one additional case of cancer in every 5,000 people taking the highest dose for seven years.

The contamination puts a spotlight on manufacturers in China and India, which supply more than two-thirds of all active pharmaceutical ingredients used in medicines, industry executives estimate. China accounts for the lion’s share.

Huahai, founded in 1989 and listed in Shanghai in 2003, was one of the first Chinese companies to get drugs approved in the U.S. market.

The FDA has inspected the site that made the contaminated valsartan three times since 2010, its records show. European inspectors also visited regularly.

The provincial branch of the Chinese FDA (CFDA) also inspected Huahai facilities 10 times in connection with new drug applications between January 2016 and June 2018, the national online database shows.

SCRUTINY

U.S. and European regulators have increased scrutiny of Chinese and Indian drug factories after the adulteration of the blood thinner heparin sickened hundreds and caused the deaths of at least 81 Americans in 2007 and 2008.

The CFDA is also on alert.

Last month, it revealed that Changsheng Bio-technology , a vaccine maker, had fabricated data and sold ineffective vaccines for children. It also found that a diphtheria, tetanus and pertussis vaccine sold by the state-owned Wuhan Institute of Biological Products was substandard.

The fact that international inspections do not appear to have detected the NDMA contamination alarms Anders Fuglsang, a former European medicines regulator who runs a pharmaceutical consultancy in Denmark.

“We need to ask ourselves how it is possible – despite pharmacopoeias and agency guidelines, inspection programs with coordination across continents, a system of public quality control, and companies complying with all rules – that a nasty carcinogen can find its way into our drugs and be there for years without anyone noticing,” he said.

(Additional reporting by Shanghai newsroom, Zeba Siddiqui in Mumbai and Sharnya G in Bengaluru; Editing by Sonya Hepinstall)

Trump: major drug companies to announce voluntary price cuts soon

U.S. President Donald Trump arrives prior to signing the "Right to Try Act," which gives terminally ill patients the right to use experimental medications not yet been approved by the Food and Drug Administration (FDA), at the White House in Washington, U.S., May 30, 2018. REUTERS/Leah Millis

WASHINGTON (Reuters) – President Donald Trump on Wednesday said he expects major drug companies to cut prices on their products in two weeks, but did not provide details on which companies would do so or the means by which they would provide such reductions.

“You’re going to have some big news. I think we’re going to have some of the big drug companies in two weeks said they’re going to announce, because of what we did, they’re going to announce voluntary massive drops in prices,” Trump said at a signing ceremony for a new law making it easier for seriously ill people to try experimental treatments.

Earlier this month, Trump unveiled the administration’s plan to lower prescription drug prices, largely through regulatory authority, calling the plan “the most sweeping action in history” to reduce the cost of medicines for consumers.

But healthcare stocks rose as it became clear that his administration avoided aggressive direct measures to cut prices.

The Health and Human Services Department has put out a request for information for its drug pricing plan, but has yet to issue any new regulations or pilot programs to lower drug prices.

Trump campaigned on lowering drug prices and has said that pharmaceutical companies were “getting away with murder,” but has since backed off that rhetoric.

HHS did not immediately respond to a request for comment on Trump’s announcement.

(Reporting by Steve Holland and Yasmeen Abutaleb; Editing by Chizu Nomiyama and Bill Berkrot)

U.S. to consider expanding Medicare drug price negotiation

By Yasmeen Abutaleb

WASHINGTON (Reuters) – The Trump administration is considering expanding Medicare’s ability to negotiate the cost of drugs by giving private payers a role in setting the price of medicines administered in hospitals and doctors’ offices, Health and Human Services Secretary Alex Azar said on Monday.

Azar’s comments provided more details on the plan announced on Friday by President Donald Trump to lower prescription drug costs for Americans.

While Trump has vowed to tackle rising prices since running for office, his plan spared the pharmaceutical industry from direct government negotiations to control costs. Drugmaker shares rose for a second day on Monday as Wall Street analysts said the new policies should not hurt industry profits.

Medicare is the national health insurance plan run by the federal government for Americans over the age of 65.

Azar said that Trump views tougher negotiation as key to the plan, and that his agency will consider an alternative system for buying Medicare Part B drugs, which are administered by a healthcare provider and covered directly by the government.

Instead, the administration would seek to allow private sector payers to negotiate the price of those medicines, as they do in Medicare Part D, which covers drugs that patients pick up at the pharmacy.

“We believe there are more private sector entities equipped to negotiate these better deals in Part B, and we want to let them do it,” Azar said in prepared remarks. “More broadly, the President has called for me to merge Medicare Part B into Part D, where negotiation has been so successful.

The S&P 500 healthcare index rose 1 percent on Monday, outpacing a 0.5 percent increase for the broader S&P 500.

(Additional reporting by Michael Erman; Editing by Michele Gershberg and Dan Grebler)

Zika vaccine race spurred by crisis and profit potential

Research scientist Dan Galperin works in the research laboratory at Protein Sciences Inc. where they are working on developing a vaccine for the Zika virus i

By Bill Berkrot

NEW YORK (Reuters) – The race to find protection against the Zika virus is fueled by something often missing from tropical disease research: the potential for big profit.

The prospect of a blockbuster vaccine against a mosquito-borne virus has accelerated the pace of development and attracted the interest of big drugmakers, including Sanofi, GlaxoSmithKline Plc and Takeda Pharmaceuticals.

Although Zika infections are mild or asymptomatic in most people, demand for a vaccine is expected to be strong because it can cause devastating birth defects, pharmaceutical executives and disease experts said.

The most lucrative market is seen in travelers seeking inoculation against the virus that has moved rapidly across the Americas and is the only mosquito-borne disease also spread through sex.

“It scares people,” said Scott Weaver, a virologist with the University of Texas and chairman of the Zika task force for the Global Virus Network. “Europeans and Americans can pay a pretty high price for these kinds of vaccines.”

A vaccine could come to market in as little as two years. Even if the current outbreaks in Latin America and the Caribbean burn out by that time, people living in those regions are expected to want protection against a return of Zika.

Tens of millions of travelers from United States and other wealthy nations, including people on business trips with corporate-sponsored health coverage, are expected to get vaccines before visiting areas where Zika is circulating.

“If you consider just a portion of the U.S. traveler population, we can conservatively envision a Zika market opportunity exceeding $1 billion” a year, said Joseph Kim, chief executive of Inovio Pharmaceuticals, a Pennsylvania company that is farthest along in the development path with human testing of a vaccine candidate underway in hard hit Puerto Rico.

Drugmakers and disease experts also envision the vaccine becoming standard care for girls before puberty to guard against birth defects in future pregnancies. Boys also could be candidates to protect eventual sexual partners.

“Hopefully a vaccine can be developed that’s sold for a low cost in endemic areas,” Weaver said.

ZIKA’S DIFFERENCE

Blockbuster sales for vaccines against mosquito-borne viruses are unheard of. Sanofi’s dengue vaccine, approved in nine countries, is generating near-blockbuster expectations, the biggest in the market by far. Analysts forecast annual sales for Dengvaxia reaching about $900 million by 2020, according to Thomson Reuters data.

Efforts to find a malaria vaccine are purely philanthropic. The Bill and Melinda Gates Foundation has contributed significantly to GSK’s decades-long effort to produce a vaccine for children in Africa. Development is ongoing, and GSK expects no profit.

The U.S. National Institutes of Health (NIH) developed a potential vaccine for West Nile virus, but it failed to find a commercial partner because the virus did not inspire enough public alarm to generate big sales. West Nile leads to serious complications in less than 1 percent of people infected.

In February, the World Health Organization declared a global public health emergency because of Zika’s apparent link to microcephaly, a birth defect marked by small heads and serious developmental problems. That, and evidence of other severe fetal brain abnormalities linked to Zika, have galvanized efforts to speed vaccine development.

The NIH is negotiating with companies to produce Zika vaccines but has its own pilot plant that can make enough for early clinical testing, which began with its first candidate in August.

“We’re not dependent on a company until you prove it works and then you need somebody to manufacture millions of doses,” said Dr. Anthony Fauci, director of the NIH’s National Institute of Allergy and Infectious Diseases (NIAID).

The first NIH candidate is a DNA vaccine containing no actual virus, in which genetically engineered cells produce an antigen that triggers an immune response, similar to the West Nile vaccine. By early 2017, the agency expects to be able to decide whether to begin enrolling thousands of patients in an efficacy study, or move on to the next candidate.

The size of the Zika outbreak may help development efforts. If it remains widespread, it will be easier to tell if a vaccine is effective.

“If the infections die down, then it’s going to take much longer to find out if it works,” Fauci said.

A second NIH candidate contains inactivated viral material, while a third utilizes attenuated, or weakened, live virus.

DNA-based candidates are most likely to prove safe, but they typically require multiple doses to work. Vaccines that contain live virus are considered most effective with one dose, but have a far higher safety hurdle, particularly if they are intended for pregnant women, and so they take longer to get to market.

INDUSTRY PILES IN

Inovio’s DNA vaccine is injected along with a brief low voltage electronic pulse that induces cell membranes to open, making them more receptive, in theory, to accepting the vaccine’s genetic material.

Privately-held Protein Sciences Corp built its Zika vaccine using technology similar to its already approved Flublok flu vaccine. The drugmaker has partnerships with companies in Argentina, Brazil, Japan and Mexico and plans to seek funding from Brazil and the NIH. It expects to start human trials by January.

Chief Executive Manon Cox estimated the cost of developing and securing approval for a vaccine could be as high as $1 billion. Without government funding, “that product has got to have a market of a few billion dollars,” she said.

With the help of $43 million in initial funding from the U.S. government, France’s Sanofi is developing a candidate using live attenuated virus. The company is not as far along as some other efforts, but it aims to start human trials next year and is confident it can catch up.

“We’ve got technologies, infrastructure, experience dealing with regulators in this field. All of that gives us a jumpstart,” said Nick Jackson, head of research for Sanofi’s vaccine unit.

Another French vaccine maker, Valneva SE, generated an inactivated Zika vaccine candidate using the same process as its already approved Japanese encephalitis vaccine.

GSK is working with NIAID on a new type of vaccine technology. Japan’s Takeda also secured U.S. government funding to help develop a vaccine using killed Zika virus and plans to begin human testing in the second half of 2017.

“If there is a huge need,” said Dr. Rajeev Venkayya, president of Takeda’s global vaccine unit, “there will be a business model that works.”

(Reporting by Bill Berkrot; Editing by Michele Gershberg and Lisa Girion)

Future of health, drug pricing: paying for benefits not per pill

A customer waits at the counter of a CVS Pharmacy store in Pasadena, U.S

By Ben Hirschler

LONDON (Reuters) – Global pressure on health spending is forcing the $1 trillion-a-year pharmaceutical industry to look for new ways to price its products: charging based on how much they improve patients’ health, rather than how many pills or vials are sold.

In the United States, both parties are promising fresh action on drug prices whoever wins the White House. In Europe, economies are stalled, squeezing state health budgets. And in China and other Asian markets, governments are getting tougher with suppliers.

Pricing drugs based on clinical outcomes is one way to ensure that limited funds bring the most benefits to patients now and pay for the most promising medical advances in future. Some experiments in pricing have already been made.

But shifting the overall industry to a new model requires improvements in data collection and a change in thinking, say drug pricing experts.

“Eventually, we are going to get there,” said Kurt Kessler, managing principal at ZS Associates in Zurich, which advises companies on sales and marketing strategies. “But it is a long, tough slog because it’s difficult to get the right data and agree on what the right outcomes are to measure.”

In the past, governments and insurers made room in their budgets for new drugs by switching to cheap generics as patents expired on older drugs. But today generics already account for nearly nine out of every 10 prescriptions in key markets like the United States, and fewer big drugs are going off patent.

That leaves little headroom for pricey new medicines for cancer and other hard-to-treat diseases, even as they come to market in growing numbers. The U.S. Food and Drug Administration has already approved 16 new drugs this year.

Investors got a wake-up call on the issue last Friday when $10 billion was lopped off the market value of Novo Nordisk <NOVOb.CO> as the world’s biggest diabetes firm warned of falling U.S. prices.

Pharmacy benefit managers administering U.S. health plans are pushing back hard by excluding some drugs deemed too expensive – including Novo’s – leading to a crunch in areas like diabetes, a disease that now accounts for 12 percent of global healthcare spending.

The Danish group has an unusually high exposure to the U.S. market, but it is not alone in signaling tough times ahead.

The chief executives of Novartis, Eli Lilly and GlaxoSmithKline have all warned recently that pricing will become increasingly challenging across the board.

Accounting for 40 percent of global drug sales, the fate of the U.S. market is front and center in the minds of drug company executives, some of whom privately admit to preparing for a “confrontational” period in relations with politicians.

Both Hillary Clinton and Donald Trump have suggested new measures to curb prices, including allowing imports from lower-cost countries, while individual U.S. states, starting with Vermont, are working on transparency legislation that would require firms to disclose costs to justify drug prices.

Novartis CEO Joe Jimenez believes drugmakers must develop value-for-money pricing models, like the performance-based deal the Swiss drugmaker recently struck with two U.S. insurers for its new heart failure drug.

Under that deal, payments for Novartis’ Entresto pill are to be calculated in future based on the proven reduction in the proportion of the insurers’ patients admitted to hospital for heart failure, not on the number of pills they consume.

The aim is a flexible pricing system that rebates healthcare providers when a drug doesn’t work as planned and charges more when it works well.

EUROPE IN VANGUARD

Europe is in the vanguard of such moves. Britain agreed an early performance-based deal for a Johnson & Johnson blood cancer drug back in 2007 and Italy also uses patient data to pay for cancer drugs based on actual patient responses.

GSK CEO Andrew Witty sees this outcomes-based approach slowly becoming the norm in more disease areas and geographies.

“Whoever wins the election in the U.S., and also in Europe, we will see those conversations play out over the next few years,” he told Reuters. “I am not particularly expecting anything dramatic in 2017. I would say it is worth keeping an eye open for evolution of change, probably in ’18 and ’19.”

The pharmaceutical industry’s European trade association is already discussing ways to shift to outcomes pricing, following price curbs in Germany that have caused some companies to pull products off the market, and effective rationing in Britain, where strict cost-effectiveness rules apply.

Authorities in Asia’s two biggest markets, China and Japan, are also intervening in new ways to cap runaway costs.

Dani Saurymper, manager of the AXA Framlington Health fund, believes the issue is going to move up the agenda for investors, not least with the arrival of gene and cell therapies. These could cure diseases like haemophilia and certain cancers, but at a cost of hundreds of thousands or even $1 million a patient.

“Pay for performance is going to become much more relevant,” he said.

Still, the obstacles are formidable. Drug companies and healthcare providers will need to work together to develop systems that capture and prove a medicine’s clinical value, ideally using computerized systems that are only just emerging.

There are also potential legal pitfalls, given the need to establish clear-cut clinical outcomes for patients and determine how much of an effect should be attributed to the medicine or other healthcare inputs.

“Overall, it is the right direction but there are many practical difficulties,” said Helen Roberts, a specialist in healthcare at law firm BonelliErede. “There may well be legal challenges if there is disagreement as to whether an outcome has actually been achieved.”

(Additional reporting by Simon Jessop)

American’s pay highest cancer drug prices in the the world

Four-year-old Niuniu sits on a bench while his mother pays his medical bills at Shanghai Children's Hospital

By Deena Beasley

CHICAGO (Reuters) – Americans pay the highest prices in the world for cancer drugs, but the treatments are least affordable in lower income countries, according to the results of a new study released on Monday.

The study of cancer drug prices in seven countries, which did not take into account discounts or rebates to list prices, was presented at the annual meeting of the American Society of Clinical Oncology in Chicago.

The lowest drug prices were found in India and South Africa. But after calculating price as a percentage of wealth adjusted for the cost of living, cancer drugs appeared to be least affordable in India and China.

Researchers at Rabin Medical Center in Petah-Tikvah, Israel, calculated monthly drug doses for 15 generic and eight brand-name cancer drugs used to treat a wide range of cancer types and stages. List prices in Australia, China, India, South Africa, the United Kingdom, Israel, and the United States were obtained from government websites.

The high prices commanded by modern cancer drugs are generating increased resistance and demands for price discounts from politicians, health care providers, insurers, patients and some doctors.

Drug companies argue that they need to make a profit to pay for the billions of dollars needed for drug research. Many companies also have extensive low-cost or free access schemes for patients who cannot afford their medicines.

The study researchers used gross domestic product and cost of living statistics from the International Monetary Fund to estimate drug price affordability.

Median monthly prices for branded drugs ranged from $1,515 in India to $8,694 in the United States. For generics, median prices were highest in the United States, at $654, and lowest in South Africa, $120, and India, $159.

In terms of ability to pay, the study found cancer drugs to be most affordable in Australia, where generic drugs were priced at 3 percent of “domestic product per capita at purchasing power parity” and patented drugs were 71 percent of the same measure.

In China, the study found generic drug prices were 48 percent and patented drugs were 288 percent of wealth adjusted for the cost of living.

In India, the cost of generics was 33 percent of that measure, while patented drugs were 313 percent.

In the United States, generics were found to be priced at 14 percent of wealth adjusted for the cost of living, and patented cancer drugs were 192 percent of the same measure.

The study did not take into account that drug costs are paid by either the government, health insurers, or patients themselves, depending on each country’s health insurance system.

Worldwide spending on cancer medicines will exceed $150 billion by 2020, driven by the emergence of expensive new therapies that help the immune system to attack tumors, according to a forecast earlier this year from IMS Health Holdings <IMS.N>.

(Reporting By Deena Beasley; Editing by Bill Rigby)