Print Shortlink

Pharmacy Industry News: Van Vliet suddenly leaves KV’s interim CEO job

Pregnancy drug’s huge price hike stuns patients, doctors, insurers

The cost of a popular drug to help prevent preterm labor is increasing by 100 times, a revelation that has stunned pregnant women, their doctors and pharmacists this week.

“I’m ready to have a heart attack,” Janice Watkins, a Pittsburgh resident who is pregnant and has been taking the generic drug known as 17P, said Thursday after she learned of the price increase from her doctor’s office. “I’m nervous now because I have to go home and call my insurance company to see if they’ll cover me.”

Typical doses of 17P that now cost $10 to $20 per dose will have a list price of $1,500 under the brand name Makena. That’s because KV Pharmaceutical of suburban St. Louis last month won government approval to exclusively market and sell Makena, a synthetic version of the hormone progesterone.

Doctors and health care advocates worry that some women who need the drug will not be able to afford it or their insurance companies will no longer cover it.

“I don’t think there’s any question that fewer women will use it now,” said Ronald Thomas, director of maternal-fetal medicine for West Penn Allegheny Health System, where 60 to 80 women a year use the drug. “Insurance companies may be happy to approve it if it was $250 to $300 (per person) but they may take a second look at it if it’s a $25,000 to $30,000 charge.”

The drug’s estimated total cost during a pregnancy could reach $30,000. High-risk women — those who’ve had difficulty bringing a prior birth to full term — can take the drug for up to 20 weeks during pregnancy.

When Thomas first heard about the price increase Thursday, he said, “I thought it must have been a misinterpretation of the cost. You can’t describe this as anything other than greed.”

KV Pharmaceutical said in a statement that it “has made significant investments to advance Makena through the FDA-approval process and make it available to patients who need it and have a significant obligation in the form of a large, ongoing clinical study. The company has also made a significant investment in developing a network of specialty pharmacies, specialty distributors and a comprehensive customer support center.”

The list price is $1,500; the company said the actual cost to patients should be substantially lower than that, depending on their coverage. It also said it would assist low- and no-income women in paying for the drug at little or no cost.

What bothers doctors, pharmacists and patients about the cost is that Makena is merely a rebranded version of a drug that had been in use for 50 years but had gone out of use 11 years ago, earning the “orphan” drug status. It had been used for disorders of the adrenal glands or the ovaries.

It gained new attention after a 2003 National Institutes of Health-funded study found that only 36 percent of women at risk of preterm labor who were given 17P had premature birth, compared with 55 percent of women who were not given the drug.

Since then, with no FDA-approved version of the drug commercially available, special pharmacies that custom- compound treatments have been churning out individual doses — typically five or 10 doses per vial — with positive results.

Because of KV’s exclusivity right, compounding pharmacies are no longer allowed to produce the drug beginning next week.

Van Vliet suddenly leaves KV’s interim CEO job

Struggling KV Pharmaceutical Co. said David Van Vliet has been replaced as interim CEO by the head of the company’s branded drug unit.

The company provided no details about Van Vliet’s departure, only that it will search for a permanent CEO. Meanwhile, Gregory J. Divis, president of KV’s Ther-Rx subsidiary, will take over on an interim basis.

KV spokeswoman Catherine Biffignani declined to comment on the transition. Van Vliet also declined to comment when reached at home Friday afternoon.

The shake-up at KV continues a tumultuous run for the company whose products were pulled from pharmacy shelves in 2008. Since then, manufacturing operations have been idled until KV complies with federal rules on drug-making practices. A subsidiary pleaded guilty to federal charges of failing to inform regulators that it was making oversized tablets. And the company has laid off more than three-quarters of its employees.

The biggest question surrounding KV these days is its ability to remain afloat while waiting for approval from the Food and Drug Administration to restart production.

“It has been a difficult period for KV,” Divis said in a statement. “I and the board of directors are committed to doing all that we can to restore KV’s revenue stream and shareholder value.”

KV said the board is focused on working with the FDA and continuing to explore financial alternatives to strengthen cash holdings.

Earlier this month, KV sold its Particle Dynamics unit for $24.6 million.

Van Vliet joined KV in 2006. He was named interim CEO in December 2008 when Marc Hermelin, the firm’s longtime chief executive and founder’s son, was ousted following a probe by the board’s audit committee.

Hermelin retained his board seat and, with help from his family and allies, led a successful push last year to change KV’s bylaws to give controlling shareholders more power.

At the company’s annual meeting Thursday, shareholders re-elected Hermelin to the board along with his brother David Hermelin, Chairman Terry Hatfield and director John Sampson.

KV said Friday that Marc Hermelin will serve the board on a “transitional” basis and will not return to the company as an officer or employee.

Three new directors were also approved: Mark A. Dow, Gregory Bentley and Joseph D. Lehrer. All will serve one-year terms.

Divis, the new interim CEO, joined KV three years ago after spending almost 18 years in the pharmaceutical industry with companies including Shering-Plough Corp. and Sanofi-Aventis.

KV hopes to obtain FDA approval to restart drug production later this year. The company signed an agreement to market and sell Gestiva, a drug intended to prevent premature birth. Under the agreement, Baxter Pharmaceutical will manufacture the drug, and KV will bring it to market.

But plenty of challenges remain, including remaining financially viable until it gets FDA approval. KV also faces a number of lawsuits from patients and their families and a $100 million suit from CVS Pharmacies, which claims that KV broke a supply contract.

Drug price infuriates those who help moms

Local health advocates have gone from hopeful to angry after a drug designed to prevent premature births was approved by the FDA only to go up in price about 100 times its original cost.

At first, Ohio doctors were thrilled that the U.S. Food and Drug Administration approved injections of the synthetic hormone progesterone, meaning the drug would be easier for women to obtain.

But after the FDA gave the go-ahead last month, the manufacturer of Makena announced it would now cost $1,500 per dose, roughly 100 times the former price.

” Outrage is the best word to describe it,” said Jay Iams, a doctor of maternal fetal medicine at Ohio State University Medical Center. “We had been so delighted and cheering for them, but when we heard the price, it felt like Satan had just purchased your favorite sports team.”

Iams and other health professionals with Ohio Better Birth Outcomes, a team of hospitals and clinics in central Ohio that works to prevent premature births and treat the effects of early deliveries, said this setback won’t stop their work.

At least 336 women were enrolled in the organization’s progesterone-injection program in 2009, and 480 were last year, said Pam Carr, executive director of Partners for Kids and one of the developers of Ohio Better Birth Outcomes.

Carr said that use of the hormone already has shown signs of helping at-risk women stay pregnant longer.

Franklin County is one of the primary funding sources for the program. Commissioners had planned to approve the next $500,000 payment of their $7million pledge next week.

Commissioner Paula Brooks said pressure should be put on the pharmaceutical company to reconsider the price.

“I’m really mad about this,” she said yesterday. “What the heck is going on here? The company is killing children if this drug is withheld from mothers who need it because of price gouging.”

The March of Dimes has said that, if all at-risk women who are eligible used the drug, it could prevent almost 10,000 premature births a year nationwide. But if the cost is prohibitive, that might prevent many women from getting it, especially low-income women, who have a higher rate of premature births anyway.

The drug has been around for years from specialty pharmacies, at a cost of $10 to $20 per injection, with weekly injections required. That typically amounted to about $300 over the approximate 20 injections a woman needed from when she was about four months pregnant until she delivered.

The FDA approval means Makena will be more readily available at all pharmacies, but also means that K-V Pharmaceutical Co. of St. Louis has exclusive rights to it for seven years. At $1,500 per dose, that could cost a woman about $30,000 throughout the pregnancy.

Still, the health advocates said they remain hopeful of change. K-V Pharmaceutical said this week that it will establish a program to provide the drug to low-income women until Medicaid kicks in to pay for it.

If the injection price does turn out to be prohibitive, pregnant women can use a vaginal suppository of the same hormone that would cost about what the injections used to cost over the term of the pregnancy.

But Carr said that the suppository has to be administered daily, which increases the likelihood of a woman forgetting a dose.

Comments are closed, but trackbacks and pingbacks are open.