OnDemand WTP Pricing Research

Is ‘what the patient pays’ the right barometer for pricing drugs? | BioWorld Perspectives

Just a few months ago, Mylan NV got caught in a net of its own making when it raised the U.S. list price for a two-pack of its Epipen to $608, a 550 percent increase over several years. The hue and cry on Capitol Hill and from angry patients with serious allergies was that Mylan was taking advantage of its near monopoly on the epinephrine auto-injector market.

Now that price is looking like a steal. Kaleo Inc. plans to relaunch its Epipen competitor, the Auvi-q auto-injector, Feb. 14 at a list price of $4,500. That’s not a typo.

Defending the pricing plan for Auvi-q, which is returning to the market after being recalled to fix a potential malfunction of its delivery device, Mark Herzog, Kaleo’s vice president of corporate affairs, told BioWorld Today that the list price – which is not a true gauge of the actual cost because it doesn’t reflect rebates, discounts and other pricing concessions – will allow the company to “absorb the cost of Auvi-q for patients who would otherwise not have access.”

In other words, Kaleo plans to compete with Epipen and its new authorized generic through a patient assistance program (PAP) – not on overall price. Herzog said Kaleo’s leadership team “believes that the most important price is the price to the patient.”

Thus, the privately owned company is touting its access program, which will give the product, free-of-charge, to patients who don’t have government or commercial insurance and have an annual household income of less than $100,000. The out-of-pocket cost for commercially insured patients will be zero, even for those with high deductibles. The cash price for other patients will be $365, so long as they’re not on Medicare, Medicaid or another government plan. Since PAPs are off limits for those with government coverage, Medicare and Medicaid patients will likely stick with Epipen or Mylan’s half-priced generic.

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Is ‘what the patient pays’ the right barometer for pricing drugs? | BioWorld Perspectives.

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