CSRXP: OUTRAGEOUS PRICE TAG ON NEW DIABETES DRUG LATEST EXAMPLE OF BIG PHARMA’S OUT-OF-CONTROL LAUNCH PRICES

Drug Company Sets Nearly $200,000 Price on Newly Approved Treatment for Type 1 Diabetes, Blowing Past Wall Street Expectations

Washington, D.C. – The Campaign for Sustainable Rx Pricing (CSRxP) released a statement today in response to Provention Bio setting a $193,900 price tag for a course of treatment with the brand name prescription drug Tzield, which was recently approved by the U.S. Food and Drug Administration (FDA) as a treatment for Type 1 diabetes.

“Provention Bio’s egregious price tag of nearly $200,000 for a course of treatment with Tzield is just the latest example of Big Pharma setting increasingly outrageous launch prices for new products and price-gouging Americans living with diabetes to pad their pockets,” said CSRxP executive director Lauren Aronson. “Even Wall Street expressed shock and concern at the greed shown by this Big Pharma company in setting such a punitive price tag on this product that faces no competition in the marketplace.”

“Big Pharma’s outrageous launch prices were already on pace for record-highs this year and brand name drug companies are showing no signs of slowing down,” Aronson continued. “To build on positive recent progress toward lowering prescription drug prices, policymakers in Washington will need to address out-of-control launch prices and advance market-based solutions to hold Big Pharma accountable.”

According to Reuters, Tzield will launch at a price of $13,850 per vial, with a total of 14 vials needed for a full course of treatment, for a total cost of $193,900. Wall Street analysts expressed shock and concern at the pricing of the brand name drug — which far exceeded expectations.

• Gregory Renza, an analyst at RBC Capital Markets, said “This (price) is much higher than perhaps what the Street was expecting.”
• David Hoang, an analyst at SMBC Nikko Securities, said “Investors will have some level of concern that this pricing could lead to insurance hurdles.” Hoang expected a price in the $70,000-$80,000 range. Pink Sheet reported analysts expected a final price between $100,000 and $115,000.

Big Pharma’s Increasingly Egregious Launch Prices

The egregious price tag for Tzield is part of a trend of Big Pharma companies setting increasingly out-of-control launch price on new products.

In October 2022, brand name drug maker Amylyx set a list price of $158,000 annually on the company’s new and unproven treatment for amyotrophic lateral sclerosis (ALS), Relyvrio, following FDA approval. The FDA’s approval came even though the drug has only completed Phase II trials, while most FDA-approved drugs typically require Phase III trials. Amylyx’s $158,000 price tag for Relyvrio was between five and 17 times what experts estimated would be a fair price for the treatment that lacks clear evidence on its clinical value for patients.

In August, a Reuters analysis found Big Pharma’s launch prices on new medications are on pace for record highs in 2022 – with the median annual price of the new treatment costing $257,000.

In June, an academic study published in The Journal of the American Medical Association (JAMA) from researchers affiliated with Harvard University and Brigham and Women’s Hospital found Big Pharma companies hiked launch prices by 20 percent every year for 14 years — and that nearly half of all brand name prescription drugs now cost more than $150,000 per year when they are brought to market.

Learn more about market-based solutions to hold Big Pharma accountable and lower prescription drug prices HERE.