Why U.S. Biologic Drugs Are So Expensive

By Sarah Jane Tribble, Kaiser Health News

Europeans have found the secret to making some of the world’s costliest medicines much more affordable, as much as 80 percent cheaper than in the U.S.

Governments in Europe have compelled drugmakers to bend on prices and have thrown open the market for so-called biosimilars, which are cheaper copies of biologic drugs made from living organisms. The brand-name products — ranging from Humira for rheumatoid arthritis to Avastin for cancer — are high-priced drugs that account for 40 percent of U.S. pharmaceutical sales.

European patients can choose from dozens of biosimilars, 50 in all, which have stoked competition and driven prices lower. Europe approved the growth hormone Omnitrope as its first biosimilar in 2006, but the U.S. didn’t follow suit until 2015 with cancer-treatment drug Zarxio. 

Now, the U.S. government stops short of negotiating and drugmakers with brand-name biologics have used a variety of strategies — from special contracting deals to overlapping patents known as “patent thickets”— to block copycat versions of their drugs from entering the U.S. or gaining market share.

As a result, only six biosimilars are available for U.S. consumers.

European countries don’t generally allow price increases after a drug launches and, in some cases, the national health authority requires patients to switch to less expensive biosimilars once the copycat product is proven safe and effective, said Michael Kleinrock, research director for IQVIA Institute for Human Data Science.

From $50 to $1,300 a month

If Susie Christoff, a 59-year-old who suffers from debilitating psoriatic arthritis, lived in Italy, the cost of her preferred medicine would be less than quarter of what it is in the U.S., according to data gathered by GlobalData, a research firm.

Christoff tried a series of expensive biologics before discovering a once-a-month injection of Cosentyx, manufactured by Swiss drugmaker Novartis, worked the best.

Without the medicine, Christoff said, her fingers can swell to the size of sausages.



“It’s 24/7 constant pain in, like, the ankles and feet,” said Christoff, who lives in Fairfax, Va. “I can’t sleep, [and] I can’t sit still. I cry. I throw pillows. It’s just … awful.”

At first, Christoff’s copay for Cosentyx was just $50 a month. But when a disability led her to switch to a Medicare Advantage plan, her out-of-pocket costs ballooned to nearly $1,300 a month — more than three times her monthly car loan.

Christoff, with the help of her rheumatologist, Dr. Angus Worthing, tried Enbrel, Humira and other drugs before finding Cosentyx, the only drug that provides relief. Christoff’s case is “heartbreaking,” Worthing said.

Novartis declined to respond to questions about Cosentyx’s price. Instead, like other pharmaceutical companies, Novartis says it offers patient assistance programs for those who can’t afford the drug. Christoff said she doesn’t qualify for financial assistance.


Like other biologics, Cosentyx costs thousands of dollars per month. The annual cost of Christoff’s treatment runs about $65,000 in the U.S. In Italy, where competition and price negotiations play a bigger role, it would run about $15,000, according to GlobalData.

In England, Dr. Christopher Griffiths, a lead researcher at the National Institute for Health Research who treats patients with Cosentyx, said the National Health Service would pay about 10,000 pounds, or less than $13,000.

And those drastic price differences are true even though there is no biosimilar version of Cosentyx yet available in Europe, and might not be for years.

The cost of the drug is taking a toll on Christoff. This past summer, her progressive disease made it difficult to enjoy the annual family vacation with her three grown children and their kids in Virginia Beach, Va.

“I can’t get down on the sand to play with my kids without help. I can’t get up without help,” Christoff recalled. “I’m not ready to stop trying. But I’m also not ready to go through my entire retirement fund to walk.”

Unlike Cosentyx, rival drugs — Humira, Enbrel and Remicade — all face biosimilar competition in Europe. Only Remicade has competition from a lower-cost biosimilar in the U.S., and Humira isn’t expected to have a copycat competitor in the U.S. market until 2023. Humira, made by AbbVie, is the world’s top-selling drug.

In late October, Wall Street analyst Ronny Gal at Sanford C. Bernstein & Co. noted that AbbVie agreed to drop Humira’s price by 80 percent in one Nordic country to combat biosimilar competition. During the company’s quarterly conference call, AbbVie chief executive Richard Gonzalez said the drug’s discount was as low as 10 percent and as high as 80 percent across the continent, with the highest discounts in Nordic countries.

“These are markets where it’s ‘winner takes all’ across the entire… category, so includes Remicade and Enbrel as well,” Gonzalez said in November, adding that Nordic countries represent about 4 to 5 percent of overall revenue in AbbVie’s international business.

Concerned about how much biologics cost the U.S. health system and patients, Food and Drug Administration Commissioner Scott Gottlieb announced an “action plan” this summer that included tapping the Federal Trade Commission for help, saying he was “worried” about the biosimilar market.

“The branded drug industry didn’t build its success by being business naive; they are smart competitors,” Gottlieb told an audience full of advocates, industry insiders and researchers at the Washington, D.C.-based Brookings Institution in July. “But that doesn’t mean we need to embrace all of these business tactics or agree with them and think they are appropriate.”  

Rebate Traps

One of these business tactics involves so-called rebate traps, in which financial deals are cut to make sure patients can get only a biologic, not a biosimilar. International drugmaker Pfizer alleged in a September 2017 lawsuit that exclusionary contracts created by Johnson & Johnson prevented use of its biosimilar by health insurers, hospitals and clinics.

Johnson & Johnson’s wildly successful biologic Remicade, the brand-name version of infliximab, produced $6.3 billion in worldwide in 2017. Pfizer launched its copycat drug, Inflectra, in the U.S. in October 2016, noting in the announcement that it would price the drug at a 15 percent discount to Remicade’s wholesale price.

Still, health systems such as Geisinger Health, based in Pennsylvania, say they have had difficulty switching to the less expensive alternative.

“J&J has done a really good job of entrenching themselves in the market,” said Jason Howay, manager of formulary services at Geisinger.

The health system ultimately decided it wanted to switch all adults to Pfizer’s biosimilar, saying it provided the same quality of treatment. But Johnson & Johnson had “bundled” the prices of other drugs with Remicade. So if Geisinger stopped using Remicade on adult patients, J&J could stop providing discounts on other drugs, such as those used for cardiology, Howay explained. “It weaves a very tangled web.”

A spokeswoman for Janssen, Johnson & Johnson’s main pharmaceutical subsidiary, says the drugmaker does offer “more attractive contract terms” to buyers who use a wider range of J&J medicines. “Our contracting approach has always prioritized access for patients and their providers,” Meredith Sharp says.

Geisinger negotiated with biosimilar maker Pfizer and won still lower prices to make up for lost savings on the other J&J drugs. It’s now transitioning all adult patients to the less expensive biosimilar.

Kaiser Health News, a nonprofit health newsroom whose stories appear in news outlets nationwide, is an editorially independent part of the Kaiser Family Foundation.

Bacteria Studies Give New Hope to IBD Patients

By Pat Anson, Editor

A new study is adding to the growing body of evidence linking gut bacteria to autoimmune and gastrointestinal diseases – research that could lead to new and more effective treatments.

Researchers at the University of Utah used animal studies to show that a certain type of yeast can aggravate symptoms of Inflammatory Bowel Disease (IBD). Their findings, published in the journal Science Translational Medicine, also suggest that allopurinol, a generic drug already on the market, could offer some relief.

IBD is an autoimmune disease characterized by chronic inflammation of the gastrointestinal tract, causing diarrhea, pain, fatigue and weight loss.

For years doctors have used the presence of yeast antibodies, specifically antibodies in the yeast Saccharomyces cerevisiae, to differentiate between Crohn’s disease and ulcerative colitis, two variations of IBD. But it was unclear the role that yeast played in relation to IBD.

“To me this was a huge hole in our understanding of the role of yeast in IBD and our health,” said June Round, PhD, an associate professor in pathology at the University of Utah School of Medicine.

Round and her research team studied two types of yeast that are common in healthy people and IBD patients. Saccharomyces cerevisiae, also called Baker’s yeast, is a prominent organism in the environment and in our food. Rhodotorula aurantiaca is also commonly found in the environment, as well as milk and fruit juice.

Scientists gave each type of yeast to laboratory mice that had been treated with chemicals to induce IBD-like symptoms. The symptoms worsened in mice fed S. cerevisiae, but not in those fed R aurantiaca.

“The mice fed S. cerevisiae experienced significant weight loss, diarrhea, bloody stool, just like a person with IBD,” said Tyson Chiaro, graduate student in Round’s lab.

Further study revealed that the mice fed S. cerevisiae had a higher concentration of nitrogen-rich compounds, called purines, than the mice fed R. aurantiaca. Unlike other yeasts, S. cerevisiae cannot break down purines that accumulate in the intestinal tract and produce uric acid. Uric acid exacerbates inflammation, which may worsen IBD symptoms.

When the mice were treated with allopurinol, a medication used to block the production of uric acid in gout patients, the drug significantly reduced their intestinal inflammation.

“Our work suggests that if we can block the mechanism leading to the production of uric acid, perhaps with allopurinol, IBD patients with a high concentration of S. cerevisiae antibodies may have a new treatment option to reduce inflammation, which could allow the intestine time to heal,” said Round.

E. Coli linked to IBD and spondyloarthritis

Another recent study has helped researchers identify E. coli bacteria found in people with Crohn's disease that can trigger inflammation associated with spondyloarthritis, a painful arthritic condition that affects the spine and joints.

Researchers used fecal samples from IBD patients to identify bacteria in the gut that were coated with antibodies called immunoglobulin-A (IgA) that fight infection. Using flow cytometry, in which fluorescent probes are used to detect IgA-coated bacteria, the researchers found the E. coli bacteria were abundant in fecal samples from patients with both Crohn's disease and spondyloarthritis.

"Our findings may allow us to develop diagnostic tools to stratify Crohn's patients with spondyloarthritis symptoms as well as patients at risk," said senior author Dr. Randy Longman, an assistant professor of medicine and director of the Jill Roberts Institute Longman Lab at Weill Cornell Medicine.

Longman and his research team found that patients with Crohn's disease and spondyloarthritis had high levels of Th17 cells, which help fight inflammation. The finding may help physicians select therapies that target inflammation in both the bowels and the joints.

"We knew there was smoke but we didn't know where the fire was," said Dr. Kenneth Simpson, a professor of small animal medicine at Cornell's College of Veterinary Medicine. "If we can block the ability of bacteria to induce inflammation, we may be able to kick Crohn's disease and spondyloarthritis into remission."

The study findings are also published in Science Translational Medicine

Rheumatoid Arthritis Drug Linked to Overdoses

Pat Anson, Editor

A drug that’s long been used to treat rheumatoid arthritis and other autoimmune diseases has been linked to dozens of deaths in the U.S. and Australia, mainly because patients have taken it daily rather than the recommended weekly dose, according to a new study published in the Medical Journal of Australia.

Methotrexate was originally developed and is still used for chemotherapy because of its ability to stop the growth and spread of tumors. Because it is also effective as an immune system inhibitor, low doses of methotrexate became a front line therapy for rheumatoid arthritis in the 1950’s. It is also used to treat psoriasis, lupus, sarcoidosis, and inflammatory bowel diseases such as Crohn’s.

Researchers say methotrexate is safe when taken once or twice a week, but the drug is so potent that accidental daily dosing can be lethal.

“The unusual dosing schedule of low dose methotrexate is associated with a risk that it will be prescribed, dispensed or administered daily instead of weekly,” said lead author Rose Cairns, PhD, of the NSW Poisons Information Centre in Australia.

“Used appropriately, methotrexate is considered safe and efficacious; accidental daily dosing, however, can potentially be lethal. Higher or more frequent doses can result in gastro-intestinal mucosal ulceration, hepatotoxicity, myelosuppression, sepsis and death.”

In a review of medication errors in Australia from 2004 to 2014, researchers linked methotrexate to 22 deaths, including seven cases in which erroneous daily dosing was documented. One patient took methotrexate for 10 consecutive days. Reasons for the errors included patient misunderstanding and incorrect packaging of the drug by pharmacists.

A similar study of medication errors in the U.S. over a 4 year period identified over 100 methotrexate dosing errors that resulted in 25 deaths. Over a third (37%) of the errors were attributed to the prescriber, 20% to the patient, 19% to pharmacists, and 18% to administration by a health care professional.

The researchers also found a “worrying increase” in the number of medication errors just in the past year.

“It is difficult to explain this increase, but the risk of methotrexate medication error may be increasing as the population ages. Older people may be at increased risk because of a range of problems that includes confusion, memory difficulties, and age-related decline in visual acuity,” said Cairns.

Cairns and her colleagues say more needs to be done by drug makers and health professionals to reduce the risk of methotrexate overdosing, such as clearer labeling, smaller sized packages, and distinctly colored tablets.

"Methotrexate use is likely to continue increasing as Australia's population ages, so that additional measures are needed to prevent these errors," the authors concluded.

Does Washing Your Hands Raise Risk of IBD?

By Pat Anson, Editor

Many of us were taught as children to always wash our hands before leaving the bathroom and before meals. But that basic sanitary practice may be contributing to an increase in inflammatory bowel diseases (IBD) such as Crohn’s disease and ulcerative colitis, according to a new study published in the journal Science.

Researchers at New York University’s Langone Medical Center tested the so-called “hygiene hypothesis” – the theory that some intestinal parasites and bacteria are beneficial because they help balance the immune system and reduce IBD rates. Sanitary practices have sharply reduced gut worm infections in developed nations, which now have some of the highest rates of Crohn’s disease and ulcerative colitis.

“Our findings are among the first to link parasites and bacteria to the origin of IBD, supporting the hygiene hypothesis,” says parasitologist P’ng Loke, PhD, an associate professor at NYU Langone.

“The prevalence of IBD is much less in regions of the world which have heavy worm infection. In fact, I got interested in the question of how worms can be beneficial when I was contacted by an individual who had deliberately infected himself with worms to treat his symptoms of IBD and was able to put his disease into remission.”

Loke and his colleagues found that laboratory mice infected with intestinal worms experienced a thousand-fold decrease in Bacteroides — a type of bacteria linked to people with higher risk of IBD. At the same time, the number of Clostridia, a bacterium known to counter inflammation, increased tenfold in the mice.

RESEARCHERS P'ng Loke and Ken Cadwell, NYU Langone Medical Center

RESEARCHERS P'ng Loke and Ken Cadwell, NYU Langone Medical Center

Researchers believe the immune response to the worms triggers the growth of Clostridia, which then either outcompete Bacteroides for nutrients or release toxins that are harmful to them.

In a second phase of the study, researchers gave mice an infusion of Clostridia – without the use of parasites – and found that it reduced the presence of Bacteroides.

“That gives us a lot of hope in terms of IBD therapy because maybe we don’t need to give people parasitic worms, which can be harmful and cause disease, and instead target the harmful bacteria by replacing them with healthy bacteria,” says microbiologist Ken Cadwell, PhD, an assistant professor at NYU Langone and the Skirball Institute of Biomolecular Medicine. “Our study could change how scientists and physicians think about treating IBD.”

Researchers say the hygiene hypothesis may also apply to other autoimmune diseases, including multiple sclerosis, rheumatoid arthritis, and type 1 diabetes, in which processes meant to attack foreign invaders instead become oversensitive and trigger an immune response to the body’s own cells.

IBD is a chronic or recurring immune response and a painful inflammation of the gastrointestinal tract. Inflammation affects the entire digestive tract in Crohn’s disease, but only the large intestine in ulcerative colitis.

According to the Crohn's and Colitis Foundation of America, IBD affects about 1.6 million Americans and tends to run in families. Caucasians are more likely than other ethnic groups to have IBD. The diseases are especially prevalent in Jews of European descent (Ashkenazi Jews). African Americans and Hispanics in the United States are also increasingly affected.