Over the weekend, US Congressman Ro Khanna mentioned a diabetes drug made by multinational Boehringer Ingelheim (BI), and sold at a higher price in the US than in India, for instance.
Putting the spotlight on differential pricing on medicines across countries, Khanna wrote on micro-blogging site X (formerly Twitter), “A friend of mine has diabetes & needs Jardiance. It costs $760 a month & is made by Boehringer Ingelheim, a German company. In India, they are selling it for $23.46. This is outrageous. Big Pharma is ripping off Americans to line their own pockets.”
This is not the first time differential pricing, or BI’s diabetes and heart failure drug, have come in for scrutiny in the US. Last August, the Biden Administration said, it would directly negotiate prices on 10 drugs from the Medicare programme, thanks to the Inflation Reduction Act (IRA). BI’s Jardiance featured on the first list of 10 drugs.
These discussions could pressure multinational drug companies to revise their differential pricing strategies, observed an industry insider. With Governments across the world looking to get a grip on healthcare costs, there is pressure to price medicines in home-markets closer to the price it is sold internationally, he added.
The latest discussion has come up again as the US goes into elections this year, and healthcare plays a critical part as always. Industry experts add, it may be early to predict an opportunity for drugs made in India, but it could have an impact on the overall drug pricing strategy of multinationals.
BI did not respond to the latest reference to its drug prices being different in India and the US, but shared a global statement with businessline, on the selection of Jardiance (empagliflozin) by the Centers for Medicare and Medicaid Services (CMS) Drug Price Negotiation Program.
‘Mischaracterised’
BI said, “ We believe that CMS selected Jardiance based on the spend associated with improving the health of millions of patients who rely on the proven outcomes of Jardiance – not based on the already heavily discounted price for the government.”
The law (IRA) is “often mischaracterised” as being focused on the highest-priced drugs, “when in reality CMS has selected medicines with the overall highest Medicare spending,” the company said.
Jardiance is the number one prescribed SGLT2 inhibitor with 59 million prescriptions, BI said, adding that its use had “extended the lives of treated patients by more than 4,61,000 patient-life years. Peer-reviewed, published economic assessments using real-world data consistently demonstrates that Jardiance lowers the total cost of care.”
Further, it added, “We remain concerned about the detrimental effects the IRA will have on the future of biopharmaceutical innovation. But we share the goal of ensuring the medicines we produce are affordable and available to patients and we are committed to engaging in open and transparent conversations with CMS.”
R&D spending
Investment in additional research and development in products like Jardiance is at risk due to the “flawed price-controlling measures of the IRA,” the company said. Further, it added, Jardiance indications made possible by continued R&D included: first FDA approval (2014) for use in adults with type-2 diabetes; subsequent approvals to reduce the risk of cardiovascular death in adults with type-2 diabetes and known cardiovascular disease, and to reduce the risk of cardiovascular death and hospitalisation for heart failure in adults with heart failure.
Further, it added, in June 2023, FDA approval made Jardiance the first and only SGLT2 inhibitor approved to treat type-2 diabetes in children 10 and older, and it was recently approved in the European Union for the treatment of adults with chronic kidney disease (CKD), with evaluation currently underway by the FDA for this use.