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Praluent’s lower list price isn’t yielding better sales yet

  • First quarter sales of Sanofi and Regeneron’s Praluent missed Wall Street expectations by “a long shot,” as one analyst put it, suggesting a recent price cut has yet to solve the broader challenges facing the cholesterol-lowering drug.
  • Sanofi recorded 56 million euros (around $62 million) worth of Praluent sales for the period, up 10% year over year by constant exchange rates. The French pharma noted the increase was due to growth in European markets offsetting poor performance in the U.S., where “significantly increased rebates” caused a 27% decline in Praluent sales.
  • Praluent and Repatha, a rival therapy from Amgen, are part of a drug class called PCSK9 inhibitors. While initially pegged as would-be blockbusters, both have struggled to secure payer reimbursement in part due to high list prices. Last month, Sanofi and Regeneron made Praluent available for $5,850 per year, reflecting a 60% reduction from its original wholesale acquisition cost of $14,625.

Sanofi and Regeneron haven’t had much luck unseating Amgen’s lead position in the PCSK9 market. Total prescriptions for Praluent (alirocumab) were 7,098 for the week of April 19, or about half of the 14,409 seen with Repatha (evolocumab), according to Iqvia data collected by SVB Leerink.

All three companies for some time resisted lowering list prices, citing clinical data that underscored how effective they were at curtailing the “bad,” LDL form of cholesterol. Yet payers’ reluctance to cover the medicines ultimately pushed the manufacturers to reconsider.

Amgen in October cut the U.S. list price on Repatha to $5,850 from $14,523 in a bid to secure broader insurance coverage and, according to the company, lower out-of-pocket costs for patients on Medicare. Sanofi and Regeneron would follow suit several months later, citing the same reasons.

On an earnings call Friday, Sanofi leadership said the new price on Praluent was helping the drug make significant inroads in securing greater Medicare coverage. The company expects continued pickup in Medicare Part D and, at a broader level, volume growth across the franchise.

The commentary was much like Amgen’s during the biotech’s most recent earnings report.

As the fourth quarter wrapped up, lower-priced Repatha had accounted for 25% of all units Amgen sold in the U.S. Company executives noted that they were still trying to grow the drug’s use within Medicare, where they said 43% of lives had coverage.

“At a macro level, I’ll remind you that the blended net price for Repatha in the U.S. will decline in 2019 as new contracts went into effect in January,” said Murdo Gordon, Amgen’s head of global commercial operations, on that fourth quarter earnings call.

“While the lower net price may impact reported Repatha sales near-term, we expect to see a positive impact on volume growth and reported net sales over the longer timeframe,” he added.

Still, it will take more time to assess whether price reductions are winning over payers and setting the drugs up for the kind of growth their developers seek. Investors will likely get another peek into how this strategy is working on Tuesday, when Amgen is set to report first quarter earnings.

Coverage and reimbursement aren’t the only threats, however.

The Medicines Co. is working on its own LDL cholesterol-targeting therapy with a less frequent dosing regimen. The therapy, called inclisiran, has closely watched Phase 3 readouts expected in the third quarter.

“Inclisiran does provide advantages over PCSK9 targeting antibodies including its fully synthetic composition that confers manufacturing advantages and allows for the company to demonstrate pricing flexibility unlikely to be matched by biologics,” wrote SVB Leerink analyst Joseph Schwartz in an April 25 note to clients.

Sanofi shares were up about 2.5% in late Friday morning trading.