• by Thom Forbes  @tforbes, February 14, 2017

You only had to read the Washington Post headline last Friday to know where this was headed: “An Old Drug Gets A New Price To Fight A Rare Disease: $89,000 A Year.” 

Yesterday, Marathon Pharmaceuticals said it was “pausing” the rollout of Emflaza, its treatment for Duchenne muscular dystrophy. The Food and Drug Administration (FDA) approved its use last week, in patients 5 and older, for alleviating symptoms of the rare and fatal genetic disorder that affects about 15,000 people in the United States. 

Despite lacking formal approval, patients’ families have been importing the drug — which has the generic name deflazacort — from overseas markets for about $1,200 per year on average, Carolyn Y. Johnson reported for the Post. The corticosteroid works by decreasing inflammation and reducing the activity of the immune system, according to the FDA.

Marathon CFO Babar Ghias told Johnson “that the company carefully thought about pricing and came up with a price far lower than other rare disease drugs — in the bottom 10th percentile of rare disease drug prices,” and that “after rebates and discounts, the net price will be $54,000 a year.”

Politicians sprang into action. 

“Senator Bernie Sanders and Representative Elijah Cummings, Democrats who have been critical of high drug costs, wrote [Marathon] Chief Executive Officer Jeffrey Aronin, calling the price ‘outrageous’ and asking the company to provide documents and information about how much it spent developing the drug and how it set the price,” Bloomberg’s Katherine Greifeld reports.

“To be fair, Marathon is gaming the system, not patients. In a webinar on Friday, Aronin comforted caregivers, letting them know that the out-of-pocket expense for them would be ‘zero to low cost,’” writes Juliet Preston for MedCityNews.

“The company also has a well-subscribed ‘expanded access program,’ designed for patients not enrolled in clinical trials. This program will continue to deliver the drug until further notice, Aronin said,” Preston continues.

In its announcement yesterday, Marathon said that patients who import deflazacort from other sources “will continue to have that option.”

CEO Aronin said the company “will meet with caregivers and explain our commercialization plans, review their concerns, discuss all options, and move forward with commercialization based on an agreed plan of action,” report Meg Tirrell and Dan Mangan for CNBC.

“Marathon said in the statement that it appreciates the opportunity to engage with Sanders and Cummings on the value of the drug. The company expects patients will pay a standard co-pay of $20 per prescription, Aronin said in the statement,” Tirrell and Mangan write.

“The resources we invested were substantial and we don’t expect to recoup our investment for several years and we have only seven years of market exclusivity,” Aronin also said in the “Open Letter to the Duchenne Community. “… Our preliminary meetings with the payer/insurer community have gone well and many have acknowledged the price was appropriate given the very small patient population.” 

“Deflazacort has been available in Canada and the European Union ‘for many years,’ Sanders and Cumming pointed out in their letter(PDF) to Aronin. It’s priced at about $1,000 per year in the U.K. and Canada,” Eric Sagonowsky writes for FiercePharma.

“‘We remain gravely concerned about these recurring abuses in the pharmaceutical industry,’ the congressmen wrote, urging Marathon to lower the price and calling the company’s move ‘unconscionable.’”

“For its part, leading pharmacy benefit manager Express Scripts called Marathon’s move an example of ‘egregious pricing for an old drug that is available elsewhere for much less,’” Sagonowsky reports.

“The delay was also announced at a Monday meeting in Washington of parents of children with Duchenne muscular dystrophy,” report Joseph Walker, Susan Pulliam and Jonathan D. Rockoff for the Wall Street Journal. “Catherine Collins, who spoke at Monday’s meeting and whose son, Dylan, 11, has Duchenne, accused Marathon of ‘predatory pricing. Enough, gross,’ she said. Ms. Collins, of New York, says she pays between $800 and $1,000 a year now for deflazacort that she imports from overseas.”

But Northbrook, Ill.-based Marathon said that only 7% to 9% of Duchenne patients currently take deflazacort, and that its goal is to “make it available to a much broader set of patients,” the WSJ reports.