But some doctors and researchers bristle when they weigh the drug’s cost against its medical benefits. Kazi and his fellow researchers ran 10,000 simulations, varying the assumptions on rate of hospitalization, the drug’s effectiveness, and other factors, and found tafamidis cost-effective in none of them. That’s an “extremely unusual” result for a drug that has real medical benefits, Kazi says. To meet a traditional cost-effectiveness threshold, the researchers found, the drug’s price would have to fall 93%, to about $16,500.
Pfizer says that traditional cost-effectiveness analysis is flawed for tafamidis and other rare-disease drugs, in part because the effort to put a price on additional years of life is biased against older people with shorter life expectancy.
Another factor in the drug’s price, Varma says, is the rarity of ATTR-CM, which Pfizer pegs as affecting about 100,000 people in the U.S. The FDA agreed, giving tafamidis the “orphan drug” designation, which provides regulatory and financial incentives—including seven years of market exclusivity—to companies developing rare-disease drugs.
But many doctors and researchers question whether ATTR-CM is all that rare. The 100,000 figure may be a “substantial underestimate,” the JAMA Cardiology article said. One study, the researchers noted, suggested that 13% of people hospitalized with a common type of heart failure have one form of ATTR-CM, and one in 25 Black Americans have a gene mutation that can cause a hereditary form of the disease.
Tafamidis is an example of broader problems with the orphan-drug designation, which has become a “runaway train” driving drug prices higher, says Robin Feldman, a professor at the University of California’s Hastings College of the Law. The designation was never intended to apply in cases where companies can generate a large profit, she says.
Pfizer highlighted growth in Vyndaqel/Vyndamax sales at the top of its second-quarter earnings release, noting that the drug had global revenue of $277 million. By the end of 2020, the company said in mid-September, the drug should be a nearly $1 billion global brand.
The drugmaker is conducting two large-scale studies to better understand the prevalence of ATTR-CM, says Dr. Brenda Cooperstone, the company’s rare-disease chief development officer. If the prevalence turns out to be significantly different than expected, “we would of course revisit the price,” Varma says.
He’s quick to add, however, that “patients don’t actually pay the list price.” What really matters to the company, he says, “is whether patients can access the therapy.” And that, Pfizer says, is why it offers patient-support programs—and why it’s suing the federal government to expand those programs.
Some researchers say there’s a simpler fix: slash the price. But even if the price is cut in half, “the cost to patients would still be extraordinarily high” under Medicare Part D, says Jonathan Selib, Pfizer senior vice president for global policy and public affairs.
Pfizer’s solution is to seek a legal green light for two types of patient-assistance programs: One would directly cover tafamidis copays for many Medicare Part D beneficiaries prescribed the drug through copay cards or coupons, and the other would fund an independent charity that would give copay assistance to ATTR-CM patients. These programs would help middle-income Medicare patients who don’t qualify for other types of assistance aimed at lower-income patients, the company says, such as an existing Pfizer program that provides free drugs and a Medicare subsidy that helps cover prescription costs.
The programs don’t constitute illegal kickbacks and wouldn’t improperly alter clinical decision-making, the company says, in part because tafamidis is the only FDA-approved drug for ATTR-CM.
The defendants—the Department of Health and Human Services and its Office of Inspector General—have not yet responded to the complaint in court, and the inspector general’s office declined to comment on the case. In a late-September advisory opinion, the inspector general said that Pfizer’s proposed copay-assistance program is “highly suspect” under anti-kickback laws but that it couldn’t reach a definitive conclusion on its legality because it hasn’t been implemented. The program would cover patients with income up to 800% of the federal poverty level, which includes more than 90% of all Medicare beneficiaries, the inspector general wrote, and would let “the Medicare program and taxpayers bear the financial brunt of an unchecked drug price.”
A central element of Pfizer’s argument may be easily adopted by other drugmakers. Restrictions on drug companies’ interactions with charities, Pfizer claims, infringe on their First Amendment rights. Regeneron Pharmaceuticals (REGN) sounded a similar note in a late-August effort to dismiss government allegations that it paid kickbacks through a copay foundation, saying that preventing communications with the charity restricts its “First Amendment right to engage in charitable speech.” The company has said there is “no merit” to the government’s complaint.
Pfizer’s Selib says the company isn’t launching a “frontal assault on the Anti-Kickback Statute” but asking for a narrower interpretation of the law. The U.S. attorney’s office in Boston, which brought the recent cases involving drugmakers and copay charities, declined to comment.
Pfizer and many patients and researchers agree on one thing: Medicare Part D is broken, exposing patients to unreasonable drug costs. Pfizer would like to see a cap on patients’ out-of-pocket costs in Part D and is willing to pay more into the program to help that happen, Selib says.
David Mitchell, founder and president of the nonprofit advocacy group Patients for Affordable Drugs, prioritizes a broader solution. “Medicare should be able to negotiate directly with drug companies to lower drug prices, like every other major country does,” he says. “Those negotiated prices should extend to all people, and we should use our collective purchasing power to get a better deal.”