Sen. Bernie Sanders (D-VT) and Rep. Elijah Cummings (D-MD) on Thursday questioned Ariad Pharmaceuticals CEO Paris Panayiotopoulous after the drugmaker hiked the price of its leukemia treatment by more than $80,000 in four years.
The letter follows an exposé earlier this month in TheStreet, in which the company was called out for four price hikes of the leukemia drug Iclusig (ponatinib). The most recent 8% price hike means Iclusig now costs $16,561 per month, or nearly $199,000 per year, excluding discounts or rebates, though the treatment cost $115,000 annually when it first hit the market in 2012.
The price hikes also came as within a year of its approval in the US, reports of serious side effects led the US Food and Drug Administration (FDA) to halt sales and clinical trials of the treatment.
In December 2013, FDA allowed Ariad to continue selling Iclusig but only to a smaller subset of patients.
“Despite this new evidence showing the drug posed a far greater safety risk to patients than was known when the drug came on the market, Ariad nonetheless raised the price of Iclusig several times over the subsequent four years,” Sanders and Cummings write. “Not only did Ariad raise the price of Iclusig, but it reportedly took additional steps to further boost company profits by discontinuing sales of a two-month (60-tablet) supply of its 15 mg dose, and instead selling a 30-tablet supply of the same dose for the same price – effectively doubling the cost for patients.”
According to an SEC filing, the company’s revenue increased by 95% to $103.7 million in the six-month period ended 30 June 2016, when compared to the corresponding period in 2015.
“In the United States, net product revenue increased by 43 percent to $57.6 million for the six-month period ended June 30, 2016, compared to $40.3 million in the corresponding period in 2015. The growth in product revenue in the United States is primarily due to a 31 percent increase in the number of units of Iclusig shipped, with the remainder due to price increases,” the filing says.
Because of these increases, Sanders and Cummings are seeking more information by 4 November on the company’s profits, prices paid for the drug, Ariad’s expenses on the development and sales of the drug, sales contracts, an explanation for the change in the drug’s supply and prices of the drug in foreign countries.
“These outrageous sales tactics indicate that Ariad is more concerned with its profit than with its patients,” they write.
Ariad told Focus in a statement: "We recognize oncology drugs are
expensive, but we believe in the importance and efficacy of our products.
Importantly, to achieve its mission, Ariad has invested more than $1.3 billion
in R&D and accumulated losses of approximately $1.4 billion since the
Company was founded, which have not been recovered. In 2015, Ariad generated
$119 million in total revenue and invested $171 million, or 143% of revenue, in
R&D. Iclusig is the first drug that we have brought to market after years
of risk taking and research, and it serves a very small and seriously ill group
of cancer patients. We have received a letter from
Rep. Cummings and Sen. Sanders requesting information and we plan to respond to