Price gouging by pharmaceutical companies is an all-too-common problem that makes health plans and their members pay outrageous prices for previously affordable drugs. Perhaps the most infamous of these in recent years is when Turing Pharmaceuticals raised the price of the drug Daraprim—used to treat toxoplasmosis—to $750 a tablet from $13.50. That’s a 5,000% increase.
Martin Shkreli, the founder and chief executive of Turing, said the rare use of the drug meant the price hike would have minimal impact on the health system. Such rationale means little to the patients whose lives often depend on these drugs—rare or not.
PSG uncovered a similar price gouging trend for specialty drugs used to treat Wilson’s disease, a rare inherited disorder that causes copper to build up in the liver, brain, and other vital organs. Only about 9,000 people in the United States likely have it, which means most plan sponsors aren’t concerned with managing spend for these drugs.
This lack of due diligence is costly, however. Back in 2016, a plan member who suffers from Wilson’s disease was taking Cuprimine. Through our data analysis, we identified Cuprimine as a high-cost outlier claim. As recently as 2013, this drug was available for $888 for a bottle of 100 capsules, but the company that acquired it in 2015 raised the price to $26,000 a bottle, costing the health plan $47,000 a month.
We worked with the health plan to identify a lower-cost, therapeutically equivalent alternative, Depen, which costs $14,000 monthly—about 3.3x less the cost. Both drugs contain the same active ingredient, penicillamine. We recommended the exclusion of Cuprimine and the inclusion of Depen to the plan.
However, our client recently learned there was a shortage of Depen, which required the patient to seek yet another drug treatment. This time it was Syprine, another high-cost alternative for Wilson’s disease. The same manufacturer who acquired Cuprimine also acquired Syprine in 2015. At that time, the company raised Syprine’s price from $1,300 for a bottle of 100 to $21,000. The health plan paid more than $42,000 a month.
To reduce spend as much as possible, the patient was switched to a third treatment option, a newly approved generic of Syprine. This drug costs slightly less than Cuprimine and 2% less than Syprine. The plan is now paying more than $33,000/month—better than $47,000 for Cuprimine or $42,000 for Syprine, but still at an unacceptably high cost.
Constant vigilance keeps costs in check
We contacted the Depen manufacturer. They told us that the wholesaler supplies were depleted, but that they were working closely with the FDA to ensure its return to the market.
Despite price gouging and supply fluctuations, the patient had to receive treatment for Wilson’s disease. Thus, the plan approved coverage of generic of Syprine until Depen becomes available in March 2019.
PSG’s vigilance in following the data and the market assists payers with limiting their spend—without disrupting patient care. In this case, PSG is minimizing exposure to the higher-priced generic of Syprine as much as possible. We told the PBM to authorize coverage for this generic only until the lower-cost Depen becomes available. The practice of price gouging costs payers plenty and can compromise the quality of patient care. PSG’s systematic approach and use of data in identifying trends allows us to gain immediate cost control, meet the specific needs of our clients, and work with PBMs to achieve savings. Contact PSG to learn how we’ll help turn your cost challenges into opportunities for savings.