Yet another sign of trouble for Valeant Pharmaceuticals has emerged. The beleaguered drug maker already faces congressional hearings into its pricing practices. Now, one of its bread-and-butter product lines may not ring the register as often as before.
Fewer dermatologists are prescribing Valeant medicines, according to a survey conducted last week by Deutsche Bank analysts. The change constitutes more fallout from a scandal involving the drug maker’s relationship with a mail-order pharmacy known as Philidor Rx Services. Valeant reportedly hid its ties to the pharmacy in order to inappropriately boost prescriptions and insurance reimbursements.
Specifically, 68 percent are writing fewer prescriptions for Valeant’s dermatology products and a similar percentage expect they will not prescribe Valeant drugs in coming months. The survey queried 25 dermatologists who write 10 or more prescriptions for Valeant drugs in a typical week, and have prescribed Valeant drugs through Philidor.
Of course, a survey of 25 people is not scientific and, at best, can be considered a snapshot. Still, the findings suggest that Valeant faces some difficulty. Dermatology products generated nearly 17 percent of Valeant’s $2.8 billion in sales during this year’s third quarter, and sales of its dermatology drugs rose 53 percent during that time.
Now, this source of revenue is under pressure.
To recap briefly, the drug maker last year purchased an option for $100 million to acquire Philidor, but did not disclose this until after reports appeared last month. Other reports indicated some Valeant employees helped launch Philidor in 2013 and the pharmacy reportedly changed codes on prescriptions to ensure they were filled with Valeant drugs instead of cheaper generics. The disclosures prompted the largest pharmacy benefits managers to cancel their contracts with Philidor, which is now closing.
These events appear to have soured some dermatologists on Valeant.
In discussing their views of the drug maker, several physicians responded that they have trust issues. “It is apparent that Valeant has become one of the top-three piranhas of the pharmaceutical companies,” wrote one dermatologist in response to the survey.
But not all were so negative. One physician wrote that “I am concerned that Valeant may not be able to chart a reasonable course forward after the Philidor debacle. However, if they come to me with a reasonable plan for access to Valeant meds, I will likely use it.”
We asked Valeant for comment and will update you accordingly.