Healthcare Pulse: Gilead Sciences, Inc. (GILD), Valeant Pharmaceuticals Intl Inc (VRX), and GlaxoSmithKline plc (ADR) (GSK)
Medicaid is raising concern over the current pricing structures offered by drug makers for Hepatitis C drugs, which it believes are eating too much of state budgets. The agency has written to the likes of Gilead Sciences, Inc. (NASDAQ:GILD) and AbbVie Inc (NYSE:ABBV) to discuss new ways of how to pay for the drugs.
Johnson & Johnson (NYSE:JNJ) and Merck & Co., Inc. (NYSE:MRK) have also been asked to share information about the arrangements they make with health insurers concerning the treatments. Proposed changes could affect prices drug makers are required to offer under the Medicaid program.
Drug makers are required by law to offer their drugs to Medicaid programs at the ‘Best Price’ possible. Gilead Sciences, Inc. (NASDAQ:GILD)’s Hepatitis C lead treatments Harvoni and Sovaldi are on high demand having generated billions of dollars in sales this year. The treatments can cost as much as $80,000 even though subsidies help reduce their price.
Last year alone Medicaid programs paid Gilead $1.3 billion for Sovaldi. AbbVie’s treatment hasn’t proven to be popular in terms of prescriptions.
Valeant Pharmaceuticals Intl Inc (NYSE:VRX) woes in the sector continue to deepen as new allegations over delayed royalty payment emerge. PDL Biopharma alleges it was not paid $17 million owed on time as stipulated in a 2013 agreement.
Under the agreement, Valeant is required to make royalty payments for the drug to Depomed Inc, which then transfers the same to PDL Biopharma. PDL claims that didn’t happen prompting the company to exercise a right to an audit of the medication’s financial results.
Valeant Pharmaceuticals Intl Inc (NYSE:VRX), on the other hand, maintains it made royalty payments to Depomed by October 30. However, it did not respond to allegations that it was late on making the payment. The situation is the last thing the embattled drug maker needs at the moment as it is already facing mounting pressure over its pricing practices from investors and lawmakers
GlaxoSmithKline plc (ADR) (NYSE:GSK) and the Bill and Melinda Foundation have made a $56 million Series A investment in Atreca Inc. The investment according to the biotech company will accelerate the development of drugs designed to bolster body’s defenses against cancer.
The Redwood City-based biotech develops Immuno-oncology treatments that rev up immune system’s response to cancer. CEO and co-founder Tito Serafini says they are trying to use their therapeutic antibodies to work with checkpoint inhibitors. The target is to remove brakes placed on the immune system after a cancer attack.
Atreca has already licensed a drug discovery platform from Stanford University as it moves to enhance its efforts on immunotherapy approaches. It is however yet to advance any program into preclinical testing.
Among other investors joining Gilead Sciences, Inc. (NASDAQ:GILD) and the Gates, foundations is an unnamed US large fund and Mission Bay Capital.
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