Select Medical Names Marilyn Tavenner to Board

Select Medical Holdings Corporation (“Select Medical”) (SEM), the parent of Select Medical Corporation, today announced the appointment of Marilyn Tavenner to its Board of Directors (the “Board”), effective on November 1, 2018. Her Board term will expire at Select Medical’s 2019 Annual Meeting of Stockholders, at which time she will stand for election along with the other director nominees standing for election at that meeting.

“We are very pleased that Marilyn Tavenner has joined the Select Medical Board,” said Robert A. Ortenzio, Executive Chairman and Co-Founder of Select Medical. “Ms. Tavenner brings to Select Medical a diverse point of view and proven skill set through her experience in state and federal healthcare government operations, senior executive-level healthcare administration and as a nurse. Ms. Tavenner is a welcome addition to the Board.”

Marilyn Tavenner joins the Board with nearly 20 years of national experience in the healthcare industry. From August 2015 to June 2018, Ms. Tavenner served as the President and Chief Executive Officer of America’s Health Insurance Plans. From May 2013 to February 2015, she served as Administrator of the Centers for Medicare & Medicaid Services (“CMS”) under the Obama Administration. She joined CMS in 2010 and was appointed as its Acting Administrator in 2011. Prior to her tenure at CMS, Ms. Tavenner served as the Secretary of Health and Human Resources for the Commonwealth of Virginia and as a senior executive of the Hospital Corporation of America, Chippenham Medical Center and Johnston-Willis Hospital.

Ms. Tavenner received her Bachelor of Science in Nursing and Master of Health Administration degrees from Virginia Commonwealth University.

https://finance.yahoo.com/news/select-medical-holdings-corporation-announces-201500968.html

Come January, will pharma pricing pledges hold?

• Pfizer CEO Ian Read said Tuesday the pharma plans to return to “business as normal” when making decisions on pricing its products for next year, implying an earlier pledge to defer price hikes for the remainder of 2018 would not continue come January.
• Following President Donald Trump’s public rebuke of Pfizer in July, more than a half a dozen major drugmakers — including Novartis, Roche and Gilead Sciences — announced plans to refrain from increasing prices for the second half of the year.
• Criticized by some as token pledges, the announcements mostly carried an expiration date, raising the question of how the industry would move forward in 2019. Read’s comments, along with recent remarks by Johnson & Johnson executives, suggest a return to pricing practices more in line with past patterns.

Pfizer’s reason for reversing its July price hikes, ostensibly at least, was to allow time for the Trump administration to more fully roll out policy plans contained in a “Blueprint” released last May.

Since then, the Department of Health and Human Services has rolled out two major proposals, aimed at putting pressure on drugmaker price increases and potentially piloting a new way of paying for drugs in Medicare Part B.

While significant, both proposals are far from implementation. And it appears that for Pfizer the plans announced to date haven’t spurred a fundamental rethink in how the pharma approaches drug pricing.

“We did voluntarily agree to defer price increases until the Blueprint was implemented over the end of this year,” Pfizer’s Read said on a third quarter earnings call Tuesday. “I expect our approach by the end of the year will be what I would characterize as business as normal.”

“We price to the marketplace,” he continued. “We price competitively and we will make those decisions towards the end of the year and early in January.”

There’s a reason that Pfizer, and potentially other pharmas, would be eager to return to their normal practice or annual or bi-annual price hikes, of course.

An analysis by Leerink, an investment firm, found that price increases accounted for 60% of recent sales growth recorded in the U.S. for many of the pharmaceutical industry’s top-selling drugs.

Increases in the price of Pfizer’s Lyrica (pregabalin) drove 90% of its growth between 2014 and 2017, for example. Generic competition to Lyrica could enter the market next year, which may have played a role in this more aggressive pricing strategy.

Besides the jabs from Trump, the looming mid-term elections, too, may have played a role in drugmakers’ decision-making after years of rising criticism on drug prices. Polls show healthcare high on voters’ minds.

J&J, another major U.S. pharma, also doesn’t anticipate a major shift in pharmaceutical pricing next year.

“I think we’re going to see a continued evolution in some of the categories where there are a very high level of competitors,” said Jennifer Taubert, global head of J&J’s pharmaceuticals unit, said on a third quarter earnings call. “But it will be an evolution in pricing, not a revolution or a step change.”

The Trump administration has been quick to call out cases of pharma companies reducing prices, such as Merck’s decision to drop the price of a hepatitis C drug or Gilead’s launch of a generic version of two of its top-sellers. But the question remains whether those examples are isolated cases of unusual market pressures, or signs of a broader re-evaluation.

https://www.biopharmadive.com/news/come-january-will-pharma-pricing-pledges-hold/541071/

HHS proposes start date for 340B ceiling price after hospital suit

• HHS has proposed to begin enforcing ceiling prices for the 340B drug pricing program Jan. 1, after multiple hospital groups sued the agency for delaying enforcement five times, most recently in June. The agency had earlier set the start date for July 1 of next year.
• The ceiling prices will limit how much drug manufacturers can charge 340B hospitals for their products, one of many controversies surrounding the oft-disputed drug pricing program.
• Hospital groups and 340B advocates lauded the proposed regulation, but considering the history of HHS delays, remain cautious. CMS is accepting comments on the proposed rule through Nov. 24.

The multiple delays in enforcing ceiling prices have caused much back-and-forth among 340B hospitals which have said lack of enforcement has confused providers, leaving them unaware what their competitors pay for the same drugs, and allowed drugmakers to charge arbitrary prices for their products.

It’s one of many reasons the drug pricing program has been at the center of multiple lawsuits, congressional hearings and White House scrutiny. While safety net hospitals and their allies claim the opaque nature of the 340B drug pricing program allows drugmakers to overcharge for their products, pharmaceutical companies and pharmacy benefit managers argue that hospitals aren’t passing on the savings from the program to their patients.

This proposed regulation, and the creation of an online database that makes prices transparent, should help demystify and clear up some controversy surrounding the longstanding program.

Melinda Hatton, General Counsel to the American Hospital Association, said she is pleased that HHS proposed the ceiling start date in response to her group’s lawsuit.

“We encourage HHS to stick by this commitment and to publish the final rule in time to meet that deadline,” Hatton said in a statement.

PhRMA, the drugmaker lobby, has said in the past that it “supports regulations on ceiling price calculations and civil monetary penalties that are in line with the 340B law and eliminate needless regulatory burdens on manufacturers.” The organization has also stated support for making a 340B ceiling price database operational “as soon as possible.”

https://www.biopharmadive.com/news/hhs-proposes-start-date-for-340b-ceiling-price-after-hospital-suit/541173/

Adamas hit by Q3 report, slow market penetration for Parkinson’s med

Adamas Pharmaceuticals (ADMS -21.9%) slumps on nearly double normal volume in reaction to its Q3 results released after the close yesterday. Highlights:

GOCOVRI sales were $10.6M up 39% from Q2’s $7.6M and up four-fold from Q1’s $2.6M. Company believes peak penetration will be 25 – 30% in the Parkinson’s disease dyskinesia population. Penetration this year will be ~1%, expected to grow to ~2% in 2019. Management is refining its sales approach to increase effectiveness.

Sales are recorded when the drug is delivered to its specialty pharmacy, not when sold to patients.

Number of distinct prescribers: ~1,200, up 24% sequentially.

Net loss: ($33.2M) (-42%). Quick asset balance: $233.2M.

Enrollment in Phase 3 study of ADS-5102 (high-dose amantadine) in MS patients with walking impairment should be completed in H2 2019.

Pivotal study of epilepsy candidate ADS-4101 (lacosamide) should launch in 2019.

https://seekingalpha.com/news/3404775-adamas-pharma-22-percent-q3-report-slow-market-penetration-gocovri

Alkermes panel vote puts more pressure on ALKS 3831, says JPMorgan

The “decidedly negative” FDA panel vote yesterday for ALKS 5461, while unsurprising following the briefing documents, put “significantly more pressure” on the pending ALKS 3831 Phase 3 readout in schizophrenia later this quarter, JPMorgan analyst Cory Kasimov tells investors in a research note titled “ALKS Uphill Climb Fails to Reach the Summit.” The analyst, however, believes yesterday’s panel vote was broadly viewed as a “very high risk shot on goal” and notes he completely removed ALKS 5461 from his model last year. Nevertheless, “this is clearly not a great way to kick off a catalyst rich period for the company,” says Kasimov. He has an Overweight rating on Alkermes and continues to estimate the fair value of the company’s base business at $33 per share. 

https://thefly.com/landingPageNews.php?id=2816711

AbbVie sees FY18 Imbruvica global revenue above $3.5B, US sales above $2.9B

Sees FY18 international Humira revenue approaching $6.3B. Sees FY18 Humira U.S. revenue $13.7B. Continues to see global HCV sales above $3.5B. Sees FY18 adjusted gross margins about 80.5% of sales and adjusted operating margin approaching 45% of sales.
https://thefly.com/landingPageNews.php?id=2816721

Why Repligen Gains

Shares of Repligen (NASDAQ:RGEN) jumped more than 16% Thursday morning after the company reported third-quarter operating results. The company, which develops and sells equipment needed to manufacture and purify biologic drugs, delivered record quarterly revenue of $49.5 million and year-over-year growth of 35%. That prompted management to raise full-year 2018 revenue guidance to a midpoint of $192.5 million.

The business also reported gross margin of 55.7% and operating margin of 12.7% for the first nine months of 2018. That’s up from just 51.8% and 10.8%, respectively, in the year-ago period. Considering the business is showing no signs of slowing and is becoming more profitable as it grows, it’s easy to see why investors are excited about the company’s future.

As of 12:00 p.m. EDT, the stock had settled to a 15.9% gain.

The biomanufacturing leader’s impressive performance in 2018 has been built on the successful integration of recent acquisitions. That shouldn’t be much of a surprise to investors considering the company’s entire product portfolio has come from acquisitions made in the last decade or so.

Going forward, there’s a new growth opportunity emerging for Repligen in generic biologic drugs called biosimilars. That’s because the first major biologic drugs to gain marketing approval are beginning to lose market exclusivity in various treatment indications. Companies are racing to prove to regulators that they can manufacture versions that, although not 100% identical, are close enough to deliver the same safety and effectiveness.

The first biosimilars have recently gained marketing approval in the United States and Europe. That creates an entirely new customer base for Repligen to sell products to — all at a time when the business is firing on all cylinders and delivering comfortably profitable growth.

Repligen stock may not be on the radar of most investors, but it has delivered returns of nearly 1,500% in the last 10 years thanks to successfully executing within its niche. While there’s no reason to think the company’s growth opportunities will wither anytime soon, investors should acknowledge that the stock trades at a hefty premium. For instance, shares are valued at a whopping 73 times future earnings, more than 15 times sales, and 4.5 times book value. It appears capable of growing into those metrics over time, but stocks with that much of a premium baked in can see significant declines on the first signs of trouble. Just something to keep in mind.

https://www.fool.com/investing/2018/11/01/heres-why-repligen-rose-more-than-16-today.aspx