Amgen Joins the Biden IRA "You'll Be Sorry" Chorus
Nov 4, 2022 20:24:37 GMT
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Post by icemandios on Nov 4, 2022 20:24:37 GMT
Amgen on IRA's drug price negotiations: 'Material adverse effect' on sales, business and operations
Zachary Brennan
Senior Editor
Biologic powerhouse Amgen is making clear that President Biden’s signature law authorizing Medicare drug price negotiations is going to have a negative impact on the company moving forward, although how negative remains unknown.
“The IRA’s drug pricing controls and Medicare redesign is likely to have a material adverse effect on our sales (particularly for our products that are more substantially reliant on Medicare reimbursement), our business and our results of operations,” Thousand Oaks, CA-based Amgen said in an SEC filing this morning.
But “the degree of impact” from the Inflation Reduction Act, passed into law in August, on Amgen’s business and sales “remains unclear” and “depends on a number of implementation decisions.”
Beginning last month, CMS began working with biopharma companies to inform them of which negotiations might take effect in 2026, although a Wall Street analyst’s list of which drugs might be impacted early on did not include any Amgen drugs.
Which drugs may be hit with negotiations if the reconciliation bill passes? Wall St. analysts explain
Amgen also highlighted another recent executive order signed by Biden that calls for even more creativity from CMS when it comes to bringing down drug prices, and a new report on those plans is expected in January 2023.
What the IRA means for biopharma companies has been a major question mark going into this quarter’s earnings calls, although many insiders agree that the IRA is playing into every biopharma company’s internal pipeline decision making, even if it’s one of many factors to consider.
And while the negotiations/price controls won’t take effect until 2026, some companies like Eli Lilly and Alnylam have already started blaming cut early-stage candidates as casualties of the IRA’s onerous pricing measures and orphan designation changes.
“The IRA includes a narrow exemption from negotiations for drugs that have indications associated with only one orphan drug designation, which we believe applies to our two marketed therapies for transthyretin (ATTR) amyloidosis, as both products have orphan drug designation for ATTR amyloidosis,” an Alnylam spokesperson told Endpoints News last week. “We will continue to evaluate the impact of the IRA and determine the best path toward advancing an RNAi therapeutic as a treatment option for patients with Stargardt Disease.”
Democrats have also recently signaled a willingness to go after pharma launch prices too, even as the negotiations provisions are still being implemented.
Meanwhile, Amgen’s quarterly revenue was down slightly, but 11 products generated record sales in the quarter, CEO Bob Bradway said in the investor call yesterday afternoon.
In addition to its industry-leading biosimilars business, Bradway pointed to five candidates in its pipeline that the company will be looking to for future growth: olpasiran, a cardiovascular drug that showed promise in a Phase II trial; tarlatamab, a small cell lung cancer candidate; rocatinlimab for atopic dermatitis; bemarituzumab, a potential therapy for gastric and gastroesophageal cancers; and AMG 133 for obesity.
On the biosimilar end, Amgen will be the first to launch its Humira biosimilar in the US in January 2023, “followed by the next wave of biosimilar launches to STELARA, EYLEA and SOLIRIS,” Amgen EVP Murdo Gordon said on the call.
But sales of Amgen’s oncology biosimilars declined 25% year-over-year, and Gordon said Amgen expects “continued net selling price deterioration and accelerating volume declines driven by increased competition.” The most recently published average selling price for Mvasi, a biosimilar to the cancer drug Avastin, in the US declined 37% year-over-year, and for Kanjinti, Amgen’s Herceptin biosimilar, price declined 38% year-over-year, he added.
Amgen’s Enbrel, which doesn’t yet face biosimilars in the US but does in the EU, saw its sales decline 14% year-over-year for Q3, driven by lower net selling price. That price may drop further with the launch of Humira biosimilars next year, Gordon noted, adding: “So we do expect to continue to concede price on ENBREL as the category is quite competitive, but we don’t see the slope of that changing dramatically.”
Zachary Brennan
Senior Editor
Biologic powerhouse Amgen is making clear that President Biden’s signature law authorizing Medicare drug price negotiations is going to have a negative impact on the company moving forward, although how negative remains unknown.
“The IRA’s drug pricing controls and Medicare redesign is likely to have a material adverse effect on our sales (particularly for our products that are more substantially reliant on Medicare reimbursement), our business and our results of operations,” Thousand Oaks, CA-based Amgen said in an SEC filing this morning.
But “the degree of impact” from the Inflation Reduction Act, passed into law in August, on Amgen’s business and sales “remains unclear” and “depends on a number of implementation decisions.”
Beginning last month, CMS began working with biopharma companies to inform them of which negotiations might take effect in 2026, although a Wall Street analyst’s list of which drugs might be impacted early on did not include any Amgen drugs.
Which drugs may be hit with negotiations if the reconciliation bill passes? Wall St. analysts explain
Amgen also highlighted another recent executive order signed by Biden that calls for even more creativity from CMS when it comes to bringing down drug prices, and a new report on those plans is expected in January 2023.
What the IRA means for biopharma companies has been a major question mark going into this quarter’s earnings calls, although many insiders agree that the IRA is playing into every biopharma company’s internal pipeline decision making, even if it’s one of many factors to consider.
And while the negotiations/price controls won’t take effect until 2026, some companies like Eli Lilly and Alnylam have already started blaming cut early-stage candidates as casualties of the IRA’s onerous pricing measures and orphan designation changes.
“The IRA includes a narrow exemption from negotiations for drugs that have indications associated with only one orphan drug designation, which we believe applies to our two marketed therapies for transthyretin (ATTR) amyloidosis, as both products have orphan drug designation for ATTR amyloidosis,” an Alnylam spokesperson told Endpoints News last week. “We will continue to evaluate the impact of the IRA and determine the best path toward advancing an RNAi therapeutic as a treatment option for patients with Stargardt Disease.”
Democrats have also recently signaled a willingness to go after pharma launch prices too, even as the negotiations provisions are still being implemented.
Meanwhile, Amgen’s quarterly revenue was down slightly, but 11 products generated record sales in the quarter, CEO Bob Bradway said in the investor call yesterday afternoon.
In addition to its industry-leading biosimilars business, Bradway pointed to five candidates in its pipeline that the company will be looking to for future growth: olpasiran, a cardiovascular drug that showed promise in a Phase II trial; tarlatamab, a small cell lung cancer candidate; rocatinlimab for atopic dermatitis; bemarituzumab, a potential therapy for gastric and gastroesophageal cancers; and AMG 133 for obesity.
On the biosimilar end, Amgen will be the first to launch its Humira biosimilar in the US in January 2023, “followed by the next wave of biosimilar launches to STELARA, EYLEA and SOLIRIS,” Amgen EVP Murdo Gordon said on the call.
But sales of Amgen’s oncology biosimilars declined 25% year-over-year, and Gordon said Amgen expects “continued net selling price deterioration and accelerating volume declines driven by increased competition.” The most recently published average selling price for Mvasi, a biosimilar to the cancer drug Avastin, in the US declined 37% year-over-year, and for Kanjinti, Amgen’s Herceptin biosimilar, price declined 38% year-over-year, he added.
Amgen’s Enbrel, which doesn’t yet face biosimilars in the US but does in the EU, saw its sales decline 14% year-over-year for Q3, driven by lower net selling price. That price may drop further with the launch of Humira biosimilars next year, Gordon noted, adding: “So we do expect to continue to concede price on ENBREL as the category is quite competitive, but we don’t see the slope of that changing dramatically.”