Canadian provinces close the door on Alexion over price of rare disease drug

A simmering battle in Canada over the cost of a rare disease drug took a new twist as a government entity ended talks with the manufacturer because it failed to agree on evidence for justifying the price.

The pan-Canadian Pharmaceutical Alliance, which negotiates drug prices on behalf of provinces and territories, was holding coverage talks with Alexion Pharmaceuticals over its Soliris treatment for six months before reaching a dead end. The medicine costs up to $525,000. The alliance made a point of saying the inability to reach a deal is uncommon. Of 89 negotiations held to date with drug companies, only three failed to produce agreements.

“Patients and physicians want to try anything that may work to help them cope with their disease. We understand that and we can empathize with patients,” said Suzanne McGurn, the alliance’s executive director, in a statement. “However, public drug plans cannot provide coverage for all individuals who may wish to try Soliris or any drug — regardless of its cost — where the clinical evidence does not demonstrate improved health outcomes.”

“… In the face of rising drug costs, provinces and territories have a responsibility to review drug funding requests and to consider clinical effectiveness, safety, cost effectiveness and affordability, and the impact on other health services,” she continued. “This diligence is necessary to continue to provide adequate care while sustaining a publicly funded drug system for generations to come.” McGurn was not available for further comment.

Soliris is used to combat paroxysmal nocturnal hemoglobinuria, or PNH, a genetic disease that destroys red blood cells, and also atypical hemolytic uremic syndrome, or aHUS, which is a progressive and life-threatening disease affecting the immune system. The drug has become a flashpoint in Canada, though, because some patients are unable to obtain it due to its high cost, according to patient support groups.

For its part, Alexion released a statement claiming it negotiated in good faith and had not received any feedback until the decision to end talks was made. Moreover, the drug maker attempted to portray the alliance as foolhardy, noting that the UK government watchdog agency for cost-effectiveness, which is notoriously stringent about assessing drug values, last year recommended coverage for Soliris.

“Without Soliris, more than half of the children and adults with aHUS will die, require dialysis, or have permanent renal damage within 12 months of diagnosis. With Soliris, 80 percent of children and adults on dialysis were able to eliminate dialysis,” said the company. “… It is a tragedy that Canadian citizens with aHUS must suffer and die without the life-transforming benefits of Soliris.”

[UPDATE: We received this remark from Eric Hoskins, Canada’s Minister of Health and Long-Term Care: “Every day, we are seeing new pharmaceuticals coming onto the market. But increasingly, these drugs are being priced out of reach for Canadian patients. This affects those suffering from rare diseases, as well as all Canadians, by threatening the sustainability and potential expansion of our publicly funded drug programs.”]

This is only the latest clash between Alexion and Canadian authorities over the medicine.

Last October, the drug maker filed a lawsuit to stop the Patented Medicine Prices Review Board, a government agency, from imposing a price cap on Soliris, which costs either $375,000 or $525,000, in US dollars, depending upon the condition treated. The move came after the board asked Alexion to lower its price and repay sales generated by the drug from 2012 through the first half of 2014.

This dispute stems from a comparative pricing mechanism used by the board. Canadian rules require that drug prices should not be higher than the median price found in seven other countries — the US, the UK, Germany, France, Italy, Sweden, and Switzerland. And the board determined that Alexion set “the highest international price” for Soliris.

As we have noted previously, the conflict is being closely watched for wider implications. Beyond disputing specific allegations made by the board, Alexion took the unprecedented step of challenging the agency’s power to impose pricing caps. At the time, health policy experts said the legal challenge raised questions about the extent to which other drug makers may consider following suit.