Response to Virginia Department of Medical Assistance Will Only Provide Medical Coverage for Makena™
Often when a drug comes to market with an exorbitant price tag, the number is warranted. The cost of most research nowadays is a hefty one, particularly to get a drug through the FDA approval process. Funding for scientific research is limited and companies will charge (and pay) through the nose to make sure they get their drug to market. This includes initial development of the drug, set up, execution and analysis of clinical trials (animal first, then human), and then final FDA approval. Of course there is the business side, too – marketing and sales. These numbers add up. One would hope that the ultimate goal of all this is to help people – cure illness, prevent disease. At least, that’s the goal for the majority of us who go into scientific research. But we also have to remember that Big Pharma is a business. At the end of the day that means their ultimate goal is to make a profit.
The now-reduced price of $690 per dose of Makena™ (down from the original price of about $1500) might not be surprising. However, when you look into the details, the outrage in response to this price is even less shocking. KV Pharmaceuticals/Ther-Rx claim that their high price tag is appropriate for a proven, safe drug that has gone through the FDA approval process. In the compounded form a pharmacist will use the same base as in Makena™, hydroxyprogesterone caproate, to create a similar drug specific to the patient for a mere $10-20 per dose. In a press release, KV Pharmaceuticals states, “The process for compounding drugs does not require that the drug be made exactly the same every time, and there are no processes in place to monitor non-FDA approved versions for patient safety. Compounders are not required to test their ingredients or to check the final product for potency or sterility”
In my opinion, KV Pharmaceuticals loses credibility in this argument as it has a history of violating the FDA’s good manufacturing practices (1). At one point, the company was issued a permanent injunction preventing them from making or selling drugs until they were found to be in full compliance with federal drug safety rules. Similarly, to cite safety as their number one concern when a former CEO was found guilty of violating the Food, Drug and Cosmetic Act in March of this year is nothing short of hypocritical (2).
Even more bewildering, and what truly makes their position outrageous, is the argument that KV/Ther need to recoup production costs. Makena™ was approved by the FDA through a 505(b)(2) pathway, which means that they did not do their own research. Instead they cited two federally funded National Institutes of Health studies to bring their drug to market. The costs to research and test the drug that would normally justify a high price tag are not being covered by the sales price – they’ve already been paid for by federal funds. A letter from Sen. Henry Waxman and ranking members of the Energy and Commerce Committee to the manufacturers of Makena™ points out that they are setting their price, based not on research and production costs but, on what insurance companies are willing to pay (3).
At this time, the FDA has stated it will continue to allow compounding of Makena™ nationally with no penalties in order to make the drug widely available. However, Virginia has strict regulations on compounding drugs. Therefore, in Virginia, the Department of Medical Assistance will provide only Makena™ to those enrolled in Medicaid. Patients do not have the option of a compound drug. Unfortunately, this means many will not receive a drug they and their babies will so desperately need. For what? KV Pharmaceuticals/Ther-Rx is making a huge profit with almost no financial investment in Makena™. By setting the price at such an excessive level, they are possibly costing pre-term babies their lives. As a scientific researcher, as someone who works in pharmaceuticals and, particularly, as a mother I find what this company is doing to be disgraceful.
(1). See Cautionary Note, section 8
(2) CEO found guilty
(3) Letter from Waxman to Ther/Rx
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