WASHINGTON — A month after the drug maker Kaleo came under fire from lawmakers and public-health advocates for charging $4,100 for a device that reverses overdoses, the company has announced it will introduce a generic version for a small fraction of the price.
The company announced Wednesday it has authorized its subsidiary IJ Therapeutics to produce a largely identical version of its automated naloxone injector for a retail price of $178 for a kit, which, like the $4,100 brand-name version, contains two doses. First responder groups and health departments will be offered the brand-name product Evzio at the same price.
While Kaleo says Evzio is already available at no cost to most private health insurance beneficiaries, the generic will foster broader access to some Medicare beneficiaries. It will become available in mid-2019, the company said in a statement.
“With approximately 130 people dying daily from opioid overdoses, we recognize that more needs to be done to improve access for patients,” said Spencer Williamson, the company’s president and CEO.
In recent months, Kaleo was the subject of two investigations — one by “60 Minutes” and another by the Senate’s Permanent Subcommittee on Investigations — exploring why the company raised Evzio’s list price from $575 to $4,100 during a four-year span in which overdose deaths also accelerated rapidly.
While most of that tab was picked up by insurers and not at-risk individuals or their loved ones, the Senate report found that the price hike cost government health programs like Medicare and Medicaid as much as $142 million.
“The fact that one company dramatically raised the price of its naloxone drug and cost taxpayers tens of millions of dollars in increased drug costs, all during a national opioid crisis no less, is simply outrageous,” Sen. Rob Portman (R-Ohio) said then in a statement.
In a nationally televised interview the night the Senate released its report, Williamson pledged to lower the price of Evzio back to the original price of $575 or even less, but only for insurance companies that promise to make it available at an affordable price for at-risk beneficiaries.
While the list price was seen as inaccessible to most vulnerable users of prescription and illicit opioids, the company announced last year that it had donated a quarter-million of the devices to first responders, schools, and community groups.
The high price point also resulted in part from the device’s sophistication relative to other forms of naloxone. Some first responders use a cheap injectable version that requires some assembly and use of a needle. The drug company Adapt manufactures Narcan, a nasal spray, that can retail for roughly $70 per dose. The Evzio device, however, is meant for use among non-medical professionals, and includes recorded instructions that play once the device is activated ensuring the auto-injector is employed correctly.
Throughout that process, however, Kaleo sought to shift the blame to insurers and pharmacy benefit managers. Kaleo and Express Scripts, the nation’s largest PBM, recently settled a legal battle about which company owes the other money over miscalculated rebates. Williamson said Wednesday that further talks with PBMs and insurers were ongoing.