Drug company ordered to cut price of life-saving medication after 3,000% jump
$300K per year for kidney disease drug 'excessive,' says federal agency
A pharmaceutical company that increased the price of a live-saving medication is charging too much and must lower it, says Canada's drug price agency.
In a rare decision this week, the Patented Medicines Prices Review Board (PMPRB) said the price of Horizon Pharma's Procysbi "was and is excessive."
Procysbi contains the same active ingredient, cysteamine bitartrate, as Cystagon, which was brought to market by another company. The new drug has a special coating that delays absorption so it is released more slowly into the body, meaning it doesn't need to be taken as often.
Both treat nephropathic cystinosis, a rare genetic disease in children that can destroy the kidneys. Cystagon was only available through a special access program. Procysbi was approved by Health Canada in 2017.
But parents of young patients were stunned when the annual price from one to the other jumped some 3,000 per cent in 2018, from about $10,000 to more than $300,000.
Horizon calls Procysbi a "new and distinct medicine."
In its decision, the PMPRB told Horizon Pharma it must charge a lower, but unspecified, price. The company will take its new price to the provinces and territories, which will then determine if they can afford to carry Procysbi under their drug plans. A yearly cost of about $100,000 is generally seen as the maximum that the plans will cover.
"We need to consider more generally whether or not the prices of some of these new drugs are really justified," said Dr. Joel Lexchin, an emeritus professor at York University's faculty of health, where he studies pharmaceutical policy.
"When you're getting into the hundreds of thousands of dollars per year for the drug — however the drug companies justify those — ask them to open up their books and show us the figures that mean they need to charge this much."
Such decisions, which stem from public hearings, are rare for the board. Since 1993, it has reported only 10 such hearings related to allegations of excessive pricing.
The decisions can be appealed in court, but Horizon says it will not do that.
"We … believe it is best to move forward without additional litigation," said company spokesperson Amanda Phraner.
"We continue to firmly stand behind the value of our innovative rare disease medicine and the real-world value it provides to people impacted by nephropathic cystinosis."
Jeff Wright, a spokesperson for the board, said it always prefers to resolve these matters through voluntary compliance.
Wright says the last order issued by a PMPRB panel was regarding the pricing of Soliris (eculizumab) in 2017. The drug treats two rare diseases in which the body's immune system attacks and destroys red blood cells.
The Soliris decision was judicially reviewed and appealed; in June, a PMPRB hearing panel ordered the patent-holder to make an undisclosed payment to the Crown.
- This story has been updated to clarify how Cystagon was available in Canada.Sep 30, 2022 10:19 AM ET
- A previous version of this article did not say that the earlier medication, Cystagon, came from a different company.Sep 29, 2022 10:07 PM ET