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A stalemate at what cost?
Vertex, UK health officials at impasse over pricey cystic fibrosis drug
Vertex Pharmaceuticals
By Ed Silverman
STAT

A long-running effort to provide coverage in the United Kingdom for a cystic fibrosis drug has reached an impasse as health officials maintain the price offered by Vertex Pharmaceuticals is “unsupportable,’’ while the company called their position “outrageous’’ and “unconscionable.’’

At issue is the Orkambi treatment, which was determined not to be cost-effective by the UK’s National Institute for Health and Care Excellence. As a result, the National Health Service in England is refusing to provide coverage unless Vertex lowers the price. About 10,400 people suffer from cystic fibrosis in the UK, and more than 116,000 people have signed an online petition demanding NHS coverage.

Following the latest round of talks earlier this week, the NHS released a pointed statement saying that “NICE has been clear that Vertex’s pricing is unsupportable. If Vertex really believe(s) they are offering a reasonable deal, they should waive their confidentiality clause and let patients and taxpayers judge whether it is fair.’’ An NHS spokesman declined further comment.

The stalemate comes more than two years after negotiations got underway. And the failure to reach a solution has caused a furor as the episode has become indicative of the ongoing tensions caused between high drug prices and cash-strapped governments. Similar rows over Orkambi pricing are taking place in Canada, Australia, and France, as well as New York State, where the drug has a list price of $272,000.

Vertex sought to appease the UK’s NHS by offering a so-called “portfolio approach’’ to pricing. Basically, the company would guarantee a set price for an approved treatment and any subsequent medicine, rather than conduct separate negotiations for each drug as regulatory approval occurs. Variations of such arrangements exist in other countries, according to the company.

In response, the NHS proposed to add Orkambi and all future Vertex cystic fibrosis drugs to the current budget allotted to cover the cost of Kalydeco, an older drug already available in the UK, to the $254,000 list price. In effect, the agency was asking the company to provide Orkambi and its future cystic fibrosis drugs at no additional cost to the NHS. Vertex balked, in part, because just 5 percent of cystic fibrosis patients are eligible for Kalydeco, but half are eligible for Orkambi. More recently, two UK health ministers urged the company to offer “responsible pricing’’ during a closely tracked debate in Parliament.

A Vertex spokeswoman on Thursday declined to disclose pricing, but maintained that NHS “specifically’’ asked the company to sign a mutual confidentiality agreement. She also insisted the offer would provide “budget certainty’’ and that the company is willing to meet at “any time and any place’’ to resume negotiations.

“We find it outrageous that NHS England does not see a path forward to provide access for thousands of children and young people to the only medicines that treat the underlying cause of CF,’’ the company said in a statement. “We find it unconscionable that the government is unable to value the importance of these CF medicines and provide access. They are placing a lower value on the life of a CF patient than other countries around the world.’’

Not surprisingly, patient groups were furious.

“We are appalled and deeply frustrated to receive Vertex and NHS England’s statements,’’ David Ramsden, who heads the Cystic Fibrosis Trust in the UK, said in a statement.

“After years of being forced to wait, the CF community will simply not accept either party walking away from the table without striking a deal and we will all stand together. Vertex and NHS England must get back around the table quickly and ensure these medicines are made available to people with cystic fibrosis.’’

Separately, Christina Walker, a member of UKneedsorkambi, a group of families agitating for the drug, said, “When you understand the disproportionate prices Vertex are trying to charge our government, you can see that only they can resolve this situation. Vertex used UK patients to trial their drugs and now are pricing them prohibitively in complete disproportion to our health spending. Vertex is acting in a total unethical, abhorrent manner.’’

Vertex shares closed up 1 percent Thursday, at $169.49.

Meanwhile, Vertex said it has met with the Pharmaceutical Benefits Advisory Committee in Australia and that a decision on coverage there is expected soon. The Australian committee could not be reached for comment. The company has submitted also its portfolio coverage approach to Canadian officials, the Vertex spokeswoman added.

And in New York, a state panel recently voted to seek an additional rebate for a pricey cystic fibrosis drug for the Medicaid program. The vote came in response to concerns that the costs of Orkambi may cause Medicaid to exceed a cap on drug spending. The panel’s decision is being closely watched as a test of a new type of law designed to lower drug costs.

Ed Silverman can be reached at ed.silverman@statnews.com. Follow him on Twitter @Pharmalot. Follow Stat on Twitter: @statnews.