Valeant Promised Price Breaks on Drugs. Heart Hospitals Are Still Waiting.
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Version 0 of 1. The Cleveland Clinic is widely seen as the top heart hospital in the country, so when Valeant Pharmaceuticals International pledged to Congress that it would offer hospitals breaks of as much as 30 percent on two of its expensive heart drugs, officials at the hospital figured they would hear from the company soon. “I think we definitely would be among the top users,” said Scott Knoer, the chief pharmacy officer at the Cleveland Clinic. The two drugs, Nitropress and Isuprel, are commonly used to treat heart patients, and their prices shot up last year after Valeant acquired them. The clinic spent more than $5.3 million on the two drugs in 2015. “I would assume we would be on that list.” Instead, there has been silence. The same scene has played out in at least several other large hospitals around the country, including Johns Hopkins, the Mayo Clinic and NewYork-Presbyterian. Administrators at the hospitals say nothing has changed since the Senate hearing two weeks ago, when Valeant’s chief executive vowed to look into senators’ assertions that they had not found a single hospital that had received any discounts on the drugs. “Nope,” said Erin R. Fox, the pharmacist who negotiates drug prices on behalf of the University of Utah Health Care System, which spends just over $640,000 a year on the two drugs. Ms. Fox has been contacting Valeant since October of last year seeking discounts, she said. “Crickets.” “Is this just lip service?” she asked. “Or are we going to have another hearing in six weeks?” Senator Susan Collins, Republican of Maine, described the company’s pledge to offer discounts as “disingenuous” and called on one of its biggest investors, William A. Ackman, to follow through on his promise to address the issue. “Bill Ackman pledged at our hearing to address these issues at the board level,” said Ms. Collins, who is chairwoman of the Senate Special Committee on Aging, which has been investigating Valeant’s pricing practices. Mr. Ackman recently joined Valeant’s board. “I take him at his word and I hope to see significant changes soon.” Valeant has reached out to Ascension, the largest nonprofit health system in the country. And Valeant said it was offering discounts through two companies that negotiate prices on behalf of hospitals. But one of those companies, Premier, described the discounts as “minimal to nonexistent” and said that only two of its 2,500 member hospitals had received the 30 percent discounts the company had offered. Most of the rest qualified for discounts of just one penny off the wholesale price, “which is essentially no discount,” the company said. “Valeant, unlike many other companies, has never really been interested in participating in a competitive market,” a spokeswoman for the company, Premier, said in a statement. The skyrocketing prices of these two drugs are at the heart of the controversy over Valeant’s now-condemned business model of buying old drugs and raising their prices precipitously, which led to an outcry from hospitals, doctors and their patients. The practice has drawn inquiries from the United States attorneys in New York and Massachusetts, congressional hearings, and — with a litany of other problems — it has led the company’s stock to lose almost 90 percent of its value since last summer. Now, the company is in image-repair mode. In April it dismissed its chief executive, J. Michael Pearson, and shook up its board. Before he departed, Mr. Pearson described the company’s pricing policies as a “mistake,” and Valeant has since formed a committee that it said would review the pricing of new and older products, including Nitropress and Isuprel. In an interview Wednesday, Valeant’s new chief executive, Joseph C. Papa, said the pricing committee had met and discussed changes to the discount program for the two drugs. “What we’re now doing is to resolve some of those difficulties that some of the players have experienced,” he said. “I now believe we’ve got a solution to this question, and I look forward to being able to announce this,” he said. For his part, Mr. Ackman declined to comment for this article. Outrage over the cost of the two drugs began in February of last year, when Valeant bought Nitropress and Isuprel and immediately raised their prices. In 2015, the price of Nitropress, an emergency blood-pressure drug, went from $215 a vial to $881, an increase of more than 300 percent, according to the Cleveland Clinic. Isuprel, which treats abnormal heart rhythms, went from $180 to $1,472 a vial, a 718 percent increase. In February of this year, after being called before Congress to explain its practices, Valeant said it would set up discounts on the two drugs through arrangements with the companies that negotiate prices on behalf of hospitals, known as group purchasing organizations. Valeant said last week that it had offered the discounts, of up to 30 percent, through two of the organizations: MedAssets and Premier. It said the recent Senate hearing revealed “gaps” in that process. “We’re working to identify those gaps now as well as develop solutions so any hospital that is eligible for discounts on Nitropress and Isuprel receives them,” the company said. But Premier said Valeant set such strict requirements for those discounts that only a handful of hospitals have received any. It said only one hospital out of its 2,500 members was receiving a 30 percent discount on Nitropress, and 27 are receiving 15 percent to 20 percent discounts. For Isuprel, only one hospital is receiving a 30 percent discount, and nine have qualified for a 20 percent discount, Premier said. “The percentage of hospitals getting the discount was so low because it only applies to very-high-volume purchases,” Amanda Forster, the Premier spokeswoman, said in the statement. Angie Boliver, a spokeswoman for MedAssets, which Vizient bought recently, said Valeant had offered a discount on Nitropress and Isuprel since January, but declined to provide details. However, “we want to make it clear that we condemn Valeant’s past pricing and business methods,” Ms. Boliver said. “Such tactics harm providers, patients and payers.” Some hospital administrators said they were puzzled by Valeant’s seeming unwillingness to negotiate, even after several attempts. “We thought they would reach out to us, but we never heard back,” said Roy Guharoy, the chief pharmacy officer at Ascension. “Typically, you know, all pharmaceutical companies are interested to sell.” Mr. Guharoy said he was contacted by Valeant within the last week and is negotiating with the company. Ascension negotiates prices through its own group purchasing organization. The Cleveland Clinic, the Mayo Clinic and NewYork-Presbyterian — all top-ranked heart hospitals — do not qualify for the discounts because they do not use MedAssets or Premier. Mr. Knoer said he would welcome a discount on the two drugs, given how commonly they are used at the clinic. But he said a 30 percent discount would not be enough. “They raised the price 800 percent, and they are going to give 30 percent?” he said. “It is still not enough, compared to the egregious price increases they have done.” |