Bausch Unit Resubmits FDA Application for Plaque Psoriasis Med

Ortho Dermatologics, a division of Bausch Health Companies Inc. (NYSE: BHC), today announced it has resubmitted a New Drug Application (NDA) to the U.S. Food and Drug Administration (FDA) for DUOBRII™1 (halobetasol propionate and tazarotene) (IDP-118) lotion in the treatment of plaque psoriasis.

“After meeting with the FDA and understanding the additional pharmacokinetic data required for DUOBRII, we have resubmitted the NDA ahead of schedule,” said Joseph C. Papa, chairman and CEO, Bausch Health. “We continue to have confidence in an approval of DUOBRII and hope to bring forward this important new treatment option for those who suffer from plaque psoriasis as quickly as possible.”

If approved, DUOBRII will be the first and only topical lotion that contains a unique combination of halobetasol propionate and tazarotene in one formulation for the treatment of plaque psoriasis in adult patients, allowing for a potentially expanded duration of use.

https://bit.ly/2vNOrCL

Agenus receives second milestone payment from Merck

Agenus (AGEN) announced that Merck (MRK) initiated a Phase I clinical trial of an undisclosed antibody candidate discovered by Agenus, under the two companies license and research collaboration. Based on this milestone and under the terms of the agreement, Agenus received a $4M milestone payment and is entitled to receive up to an additional $95M in success milestones from Merck. This milestone is the second under the collaboration, originally announced in April 2014. According to the terms of the agreement, Merck is responsible for all product development expenses for the antibody candidate, and Agenus is eligible to receive up to an additional $95M in milestone payments, as well as royalties on worldwide product sales.

https://bit.ly/2MiJ2y1

Citron sees Tilray getting ‘support’ after Constellation bets big in cannabis

In a report published today, Citron Research called Tilray (TLRY) “best in class” and said it should be “next to get support” after Constellation Brands (STX; STX.B) announced that it will increase its ownership interest in Canopy Growth (CGC). Further, Citron argued that Tilray’s stock could be “trading at $45 a share” given the multiple assigned to its Canadian peer. ‘NEXT TO GET SUPPORT’: Andrew Left’s Citron Research said in a report published today that it sees Tilray as “next in line” in a building cannabis industry. “Citron believes that Tilray is best in class and if it were to get the same multiple we are assigning to Canopy, the stock would be trading at $45 a share,” the report read. Overall, Citron believes Tilray will be the next “pot stock” to go “much high[er]” given its best in class investors, strategic partnerships with big pharma such as Novartis (NVS), its four clinical trials and licenses for cultivation in Portugal and Canada, availability of product in 10 countries, growing space, and its partnership with Noweda, which is the largest pharmacy in Germany. Additionally, the report noted that Tilray was the first cannabis company to launch an IPO with a real U.S. bank and on the Nasdaq. “Forget about Bitcoin mania, today solidified that Weed is not only real, but also investible despite stretched valuations,” Citron contended. CONSTELLATION INVESTMENT IN CANOPY: This follows Constellation Brands’ announcement this morning that it will increase its ownership interest in Canada’s Canopy Growth to 38% by acquiring 104.5M shares, with the option of raising its stake further to 50%. As a result, Canopy Growth will “immediately upon closing have proceeds of approximately C$5B to bolster its leadership position in the global cannabis industry,” the companies stated. The beer and wine maker said it remains committed to its investment grade rating and therefore has no plans to engage in mergers, acquisitions or share repurchase activity for about 18-24 months post the deal closing. PRICE ACTION: In afternoon trading, shares of Tilray have jumped over 20% to $29.26, while Canopy stock trading in New York has gained more than 27% to $31.33.

https://bit.ly/2w8wAWt

Vertex: FDA OKs 1st and Only Med to Treat Cause of Child Cystic Fibrosis

Vertex Pharmaceuticals Incorporated (Nasdaq: VRTX) today announced the U.S. Food and Drug Administration (FDA) approved KALYDECO® (ivacaftor) to include use in children with cystic fibrosis (CF) ages 12 to <24 months who have at least one mutation in their cystic fibrosis transmembrane conductance regulator (CFTR) gene that is responsive to KALYDECO based on clinical and/or in vitro assay data.

“Cystic fibrosis is a chronic, progressive disease that is present at birth, with symptoms often occurring in infancy,” said Reshma Kewalramani, M.D., Executive Vice President and Chief Medical Officer at Vertex. “With today’s approval, parents and physicians now have a medicine to treat the underlying cause of CF in patients as young as one year of age. We are excited about the progress of our portfolio and continue to support additional research on the potential benefit of early intervention with all of our medicines, with the goal of bringing a treatment to all people living with CF.”

This FDA approval is based on data from the ongoing Phase 3 open-label safety study (ARRIVAL) of 25 children with CF aged 12 to <24 months who have one of 10 mutations in the CFTR gene (G551D, G178R, S549N, S549R, G551S, G1244E, S1251N, S1255P, G1349D or R117H). The study demonstrated a safety profile consistent with that observed in previous Phase 3 studies of older children and adults; most adverse events were mild or moderate in severity, and no patient discontinued due to adverse events. Two patients had elevated liver enzymes greater than eight times the upper limit of normal, but continued to receive KALYDECO after a dose interruption. The most common adverse events (≥30%) were cough (74%), pyrexia (37%), elevated aspartate aminotransferase (37%), elevated alanine aminotransferase (32%) and runny nose (32%). Four serious adverse events were observed in two patients.

Mean baseline sweat chloride for the children in this study was 104.1 mmol/L (n=14). Following 24 weeks of treatment with KALYDECO, the mean sweat chloride level was 33.8 mmol/L (n=14). In the 10 subjects with paired sweat chloride samples at baseline and week 24, there was a mean absolute change of -73.5 mmol/L. These data were presented at the 41st European Cystic Fibrosis Society (ECFS) Conference in June 2018 and published in The Lancet Respiratory Medicine (Volume 6, No 7, July 2018).

“I’m very excited about the approval of ivacaftor in children ages 12 to less than 24 months as this is the first regulatory approval of a CFTR modulator in this age group,” said Margaret Rosenfeld, M.D., MPH, Seattle Children’s Research Institute and Department of Pediatrics, University of Washington School of Medicine. “The premise of newborn screening for CF is to intervene very early in the course of disease with the goal of improving long term outcomes, so this is a significant milestone for parents and caregivers of young children with CF.”

KALYDECO was already approved in the U.S. for the treatment of CF in patients ages 2 and older who have one of 38 ivacaftor-responsive mutations in the CFTR gene based on clinical and/or in vitro assay data. Vertex submitted a Marketing Authorization Application for a line extension (ages 12 to <24 months) to the European Medicines Agency with a decision anticipated in the first half of 2019.

https://bit.ly/2BdQIMP

Nearly 20% of inpatient admissions include out-of-network charge

• A new Kaiser Family Foundation report found that almost one in five inpatient admissions in large employer health plans includes a claim from an out-of-network provider.
• Even when patients use in-network facilities, they often face claims from out-of-network providers. That’s true especially for emergency room claims, according to the report.
• Members who receive outpatient mental health services are significantly more likely to have a claim from an out-of-network provider, KFF said.

Surprise billing, also called balance billing, is an issue that continues to confront patients despite federal and state regulations. Even patients who make sure the facility is in-network can get whacked with out-of-network charges based on who cares for them at the facility.

Surprise billing can leave patients with medical bills beyond their means. A 2016 KFF survey reported that nearly 70% of people who couldn’t afford out-of-network bills said they didn’t know the provider was out of network when they received care.

The study authors analyzed 2016 claims for nearly 20 million people. The claims represented almost one-quarter of the 85 million people in the large group market.

The review found that 27% of admissions with an emergency room claim includes an out-of-network charge. Only 15% of in-patient visits that didn’t include an ER visit wound up with out-of-network claims.

“Patients in emergency situations have limited ability to control the care they receive and from whom they receive it. Even when the facility is in-network, the professional services may not be and the patient often is not in a position to direct their care,” according to the report.

The study also found that one-third of in-patient psychological or substance abuse claims includes an out-of-network charge. That percentage compares with surgical (20%), medical (19%) and children and newborn (11%).

The report suggested the reason for more out-of-network claims for psychological and or substance abuse is because of fewer in-network facilities or professional for those services.

KFF added that members with anesthesia and pathology claims are more likely to have an out-of-network claim regardless as to whether they get services from an in-network facility. “In many instances, it is doubtful that enrollees could reasonably anticipate or control their use of out-of-network providers,” the report said.

KFF’s report findings mirror a Health Affair study that found one-fifth of all hospital inpatient admissions that originated in the ER, 14% of outpatient ER visits and 9% of scheduled inpatient admissions led to surprise medical bills.

Though federal law requires health plans to apply in-network cost sharing when members use out-of-network providers in emergency services and some states have strengthened laws against surprise billing, many people still get hit with out-of-network charges directly from providers.

In fact, an Altarum report in November awarded only Maine and New Hampshire an A on healthcare price transparency. Maryland and Oregon got a B while Colorado and Virginia received a C. Every other state failed.

But some patients are fighting back against surprise billing.

“A lot of consumers don’t understand how insurance works, and particularly these days with high-deductible health plans becoming more and more common, a lot of people are getting bills they don’t understand,” Akshay Gupta, co-founder and executive partner of CoPatient, a company that helps consumers understand and resolve their medical bills, recently toldHealthcare Dive. “People that come to us are often quite distraught.”

https://bit.ly/2MpSGxN

Hospital Assn continues to push HHS on Medicare billing backlog

 15, 2018

• In a brief filed in the U.S. Federal Court for the District of Columbia on Friday, the American Hospital Association and three member hospitals reaffirmed support for remedies they say would cut the Medicare billing appeals backlog.
• Echoing recommendations from June, the AHA brief suggested implementing a binding deadline, which could help stop “HHS from backsliding.” The hospitals also recommended annual deadlines with fixed reduction targets to maintain steady progress.
• HHS recently said it reduced the Medicare appeals backlog by more than 30% this year. However, the agency doesn’t expect to eliminate the backlog by the court-ordered date of Dec. 31, 2020. It believes it can clear the backlog by FY 2022.

The 16-page court brief is the latest development in the AHA’s lawsuit involving the Medicare claims backlog, which goes back to 2014 and the Obama administration. In June 2016, the Government Accountability Office said the backlog was likely caused partially by expanding the Recovery Auditor Program in 2011 and how the agency handles appeals of repetitive claims for ongoing services.

Earlier this year, U.S. District Judge James Boasberg asked AHA for its recommendations on how to clear the backlog. The group and Baxter Regional Medical Center in Mountain Home, Arkansas, Covenant Health in Knoxville, Tennessee, and Rutland Regional Medical Center in Vermont recommended remedies including Recovery Audit Contractor controls, settlements, relief from the negative impacts of the backlog and agency maintenance of effort and periodic status reporting.

In its court brief this month, AHA charged that the backlog stretching back several years means hospitals might not have the funding to upgrade equipment, repair facilities or improve patient care. The brief added that the HHS is violating its mandatory statutory duty to resolve administrative law judge-level appeals in 90 days or less.

CMS announced last year it’s taking a more targeted approach to finding and investigating Medicare fraud and improper payments. That should help the process. Rather than cast a wide net, CMS is now instructing Medicare Administrative Contractors to focus on providers with high claim error rates or unusual billing practices when compared to similar providers.

HHS said it has made progress. It cut the backlog from 652,243 last year to 444,894 at the end of last month. It has also received funding to hire 80 additional administrative law judges to help catch up.

https://bit.ly/2nErlKc

Express Scripts staking out million dollar gene therapies

Express Scripts Holding Co (ESRX.O) built a multi-billion enterprise pressuring drug companies to lower their prices for U.S. patients. Now it is quietly building a side business: getting paid to help drug companies dispense a new generation of high-priced drugs.

Express Scripts is in talks with biotechnology companies Biomarin Pharmaceutical Inc (BMRN.O), Spark Therapeutics Inc (ONCE.O) and Bluebird Bio Inc (BLUE.O) to have its specialty pharmaceutical business exclusively distribute their new hemophilia therapies when they are expected to become available in 2019 and 2020, Chief Medical Officer Steve Miller told Reuters in an interview.

Biomarin, Spark and Bluebird confirmed to Reuters that they were speaking to a payers – a group generally defined as pharmacy benefit managers, health plans and government agencies – about pricing models for future therapies. Analysts project those drugs could top $1 million to $1.5 million in price.

Rather than rail against the drugs’ expected high prices, Miller echoes the familiar drug company argument that the potentially curative therapies will likely be worth the high cost if they supplant the hundreds of thousands of dollars in annual medical costs to treat ailments such as hemophilia, which affects about 20,000 people in the United States alone.

“Even if they charge $1 million, that’s a great deal,” Miller said. “So there are going to be some gene therapies where it is very clear that everyone who has that disease should get it.”

By working closely with biotech companies, Miller says it can help their expensive therapies succeed commercially. To manage any potential conflicts of interest, he said Express Scripts separates its benefits management and specialty pharmacy businesses.

The move into hemophilia builds on exclusive rights Express Scripts already has to distribute Spark’s Luxturna – an $850,000 treatment for a rare genetic disorder that, left untreated, causes children to go blind. It has a similar deal with Biogen Inc (BIIB.O) on Spinraza, he told Reuters. The drug costs $750,000 the first year and treats the rare condition spinal muscular atrophy that often kills babies within months of their birth. Spark and Biogen confirmed the agreements.

The company also helps manage one of the most expensive gene-based cancer treatments on the market: the $475,000 Novartis AG (NOVN.S) gene-based cancer therapy Kymriah – a personalized treatment that requires a long hospital stay. Novartis confirmed the arrangement to Reuters.

Those deals put Express Scripts in a vastly different role than its traditional business managing prescription drug claims for the employees of its corporate and government clients, a business Cigna Corp (CI.N) found so valuable that it agreed in March to acquire Express Scripts for $52 billion.

Patients usually know Express Scripts and other pharmacy benefit managers (PBMs) as the name on the insurance card they present at the pharmacy counter when picking up a prescription. That card activates discounts the benefits managers have negotiated with drug companies to lower prices, usually through rebates. PBMs make money by taking a cut of the rebates, and the rest goes to their clients.

Express Scripts, which negotiates the prescription payments for 80 million people in the United States, competes with UnitedHealth Group Inc’s (UNH.N) Optum and CVS Health Corp (CVS.N).

These companies are usually among the most vocal critics of the pharmaceutical industry’s pricing practices, publicly calling out companies and specific products for their high cost.

But the pharmacy benefits businesses themselves are facing growing criticism from U.S. regulators, lawmakers, drugmakers, and President Trump, who say they act as unnecessary middlemen and end up helping drive up prices for payers.

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Billionaire activist investor Carl Icahn mounted a proxy campaign to stop the deal on expectations the Trump Administration would end the rebates it relies on for profits. But he abandoned his efforts after two shareholder advisory groups came out in favor of the deal.

GROWTH vs CONFLICTS

As the PBM fight plays out publicly, Express Scripts has been expanding its low-profile specialty pharmacy business – which dispenses drugs that usually aren’t sold through drugstores because they require special handling. By using its own pharmacy instead of outsiders, Express Scripts is able to hold onto more of the profits along the drug distribution chain.

Specialty pharmacy is one of Express Script’s fastest growing businesses and accounts for about a third of its sales and profits, ISI Evercore analyst Ross Muken said. The company earned $4.1 billion last year on total revenue of more than $100 billion – it does not break out financial information for specialty pharmacy.

Many of the newest, most advanced medicines – including gene-based therapies and personalized cancer treatments – will be dispensed through specialty pharmacies, and Express Scripts is pitching biotech companies for exclusive arrangements.

By working as both the manufacturer’s partner who gets paid for each sale, and the pharmacy benefit manager responsible for negotiating the best price for its traditional corporate and government clients, Express Scripts is open to questions about being conflicted, industry sources and experts say.

“One could view this role as being a wonderfully catalytic: that they can help balance the views and interests of all the parties by being in this middle facilitating role. Or one could view that they have created a situation where internally they have multiple conflicts of interest, and can they manage them properly?” said Mark Trusheim, strategic director of a group of international payers and providers formed by the Massachusetts Institute of Technology to study gene therapy pricing models.

Express Scripts says it saves money for payers on Luxturna by cutting out the hospital pharmacy mark up, which is 6 percent for the government Medicare program and more for commercial business – or at least $60,000 on a $1 million drug.

Miller said the company has a firewall between its specialty pharmacy business, which serves the drugmakers, and its businesses negotiating on behalf of his clients, the payers.

“Our PBM treats our specialty pharmacy as they treat any other pharmacy in our pharmacy network,” he said. “So they are not privy to their acquisition prices or anything else, and the specialty pharmacy is not privy to the contracts that the PBM has with their payer clients or anything else.”

Beyond potential conflict concerns, there is risk in whether the gene therapies will ever make it to the public.

Spark on Aug. 7 said two patients in a small trial had an adverse immune response to an experimental hemophilia gene therapy and its shares lost more than a quarter of their value. And last month, U.S. regulators put Biogen’s gene therapy program for spinal muscular atrophy on hold, but no details were disclosed.

https://reut.rs/2nDMe8w