Pfizer doubling patient income limit for free drug program

TRENTON, N.J. (AP) – As the furor over soaring U.S. prescription drug prices escalates and outrageous price hikes by several smaller drugmakers give the entire industry a black eye, the biggest U.S.-based drugmaker is expanding financial assistance to patients.

Pfizer Inc. said Thursday that it’s doubling the allowable income level for people to receive dozens of its medicines without a copayment because more patients are in need. Patients’ insurance plans generally must pay the bulk of the drug’s cost. Some critics say this isn’t the best way to keep drugs affordable for everyone.

“It’s not addressing the price of the drug,” said Clare Krusing, a spokesperson for the trade group America’s Health Insurance Plans.

“This is the wrong approach when you consider the cost impact that patients have on the back end,” because insurance plans eventually raise patients’ monthly premiums to compensate, said Krusing.

She added that widely used drugmaker coupon programs, which either cover patient copayments for a specific brand-name drug or limit the copayments to a small amount, usually are temporary, lasting a year or so.

Insurers and other critics say such programs increase overall health spending, particularly ones that nudge patients to stay on brand-name drugs when cheaper generic versions are available.

New medicines for cancer, hepatitis C and rare diseases carry list prices of $100,000 or more for a year or a course of treatment, though insurers often get big discounts. Meanwhile, insurance plans increasingly require patients to pay a large percentage of the price for the costliest drugs, rather than a fixed monthly amount.

The move comes amid fierce criticism by patients and politicians, as well as a growing number of government investigations, of six-figure prices for new medications and huge price hikes on old ones with little or no competition – up to 5,000 percent, for a drug for a life-threatening parasitic infection now sold by Turing Pharmaceuticals.

Turing, Valeant Pharmaceuticals International Inc. and a handful of other companies have been accused of price gouging. Meanwhile, a continuing wave of mergers of both brand-name and generic drug manufacturers threatens to further limit competition, the primary control on prices in the U.S.

Pharmaceuticals analyst Erik Gordon, a professor at University of Michigan’s Ross School of Business, said drugmakers face “a wave of hearings and public beatings” over exorbitant drug prices.

“If you’re Pfizer, you want to look like you’ve made a voluntary, charitable move before you get beat up” in a congressional hearing, Gordon said.

Most drugmakers offer financial assistance to patients, particularly when pricey new drugs are first launched and the companies are trying to get patients to start taking them, so they can recoup their $1 billion-plus in development costs.

The industry’s 20-year-old Partnership for Prescription Assistance connects patients to about 475 assistance programs, nearly 20 of them run by drugmakers.

Pfizer Chief Executive Ian Read told The Associated Press in an exclusive interview that the New York company isn’t boosting assistance due to the heightened scrutiny of prices, but because more and more patients can’t afford needed medicines.

Read, the immediate past board chairman of industry trade group Pharmaceutical Research and Manufacturers of America, said Pfizer is “responding to challenges patients are having.”

He cited insurance plans that now shift more costs onto patients through higher medication copayments and deductibles that must be met before coverage kicks in, plus some Affordable Care Act exchange plans and insurance formularies that exclude pricier prescription drugs.

“There are people who are falling through the cracks through no fault of their own,” Read said. “As a stopgap, we’re willing to do this.”

Under the Pfizer RxPathways program, the company will cover patient copayments for 44 medicines for both uninsured and underinsured patients earning up to four times the federal poverty level, up from twice that level. The new limits are $47,080 annually for a single person and $97,000 for a family of four.

The program covers many popular Pfizer brands: pain relievers Celebrex and Lyrica, smoking cessation aids Chantix and Nicotrol, the Prevnar 13 pneumococcal vaccine and erectile dysfunction pill Viagra. Nearly 20 additional Pfizer medicines, including numerous expensive cancer drugs, already were free to patients making up to four times the poverty level.

Last year, the RxPathways program helped about 350,000 patients. Pfizer expects to help a few hundred thousand more than that next year. Between 2010 and 2014, the program helped nearly 2.5 million people get more than 30 million Pfizer prescriptions worth more than $7 billion at list prices.

There’s no sign other drugmakers are expanding their assistance programs, and Gilead Sciences Inc., maker of new hepatitis C medicines with list prices of around $90,000 for a course of treatment, recently decreased the number of patients it is helping, forcing more costs onto insurers.

Merck & Co., the second-biggest U.S. drugmaker by revenue, since 2010 has offered assistance to patients with incomes up to five times the federal poverty level for some of its most-expensive medicines and four times that level for the rest.

Asked why Pfizer doesn’t just reduce list prices for its drugs in the U.S., where medicines generally cost a few times more than in other wealthy countries, Read said high prices are needed to fund innovative research on future drugs. That’s long been the industry’s mantra.

“Our prices, we think, are appropriate,” Read said. “We can’t lower the prices enough for (many patients) to afford it.”

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Online: www.PfizerRxPathways.com