Inflection Point
It’s not clear to me that anyone has noticed, but the government weighed in last night on the lawsuits from Johnson & Johnson and BMS challenging the IRA.
Unsurprising, the government takes a dim view of the industry’s approach, and the broad outlines are not that different from the arguments made in the reply to Merck’s lawsuit.
The short version is that the government views IRA “negotiations” as wholly voluntary, thereby addressing the Fifth Amendment “takings” claim, and thinks the First Amendment compelled speech argument is silly.
The interesting element, though, is the way that the government brief relies on the decision from last month in the U.S. Chamber of Commerce suit. In that case, the Chamber asked for quick action from the judge to block implementation of the law while the legal process moved forward.
The judge said no, which wasn’t unexpected, but he went on to cast some real doubts about the industry argument that the IRA wasn’t a voluntary program. It was those doubts that were amplified in the new filing in the J&J/BMS case.
That doesn’t make things open-and-shut — the Chamber case doesn’t have any precedential influence over any other case — but it makes pretty clear where the government thinks it should be shooting its shot.
The Arc
Over here at the Curve offices, we have a big sign that says “It Has Been [X] Days Since We Ranted About Obesity Meds.” Today, we had to reset the sign to zero. Again.
STAT has a worthwhile story about a number of studies out of ObesityWeek that show the impact of weight loss on health care spending. The piece doesn’t have a lot of details on the individual studies, but I trust that they all point in the same direction: lowering weight lowers spending.
That’s not surprising or worthy of a rant. What did get my eyes rolling was some of the commentary included that pointed out that many of the studies should be taken with a grain of salt because they didn’t include the cost of obesity medicines.
As a matter of study design, that’s a valid point. But the implied point was that the medicine cost would be enough to swamp the cost-saving conclusion that everyone was drawing.
I’ve said it before, but that’s an argument that is not going to age well. The direct and indirect evidence is piling up, and, even taking the price of the medicines into account, I’d bet dollars to donuts that the case for cost-effectiveness will be airtight in the very near future. (Lilly has bragged that they have 30 Phase 3 obesity-drug outcome trials ongoing.)
So while it’s fun and not particularly wrong, in a technical sense, to poke holes in some of the economic data being presented, it’s not particularly helpful. Because — as noted yesterday in my discussion of “the biggest dilemma in pharma” — the issue here is probably not “Are these meds worth it?” but, rather, “How do we pay for them?”
Quick Turns
- It’s earnings szn for pharma! Johnson & Johnson kicked things off by beating expectations. I haven’t had a chance to go through the call transcript to see if there were pricing nuggets. More tomorrow (maybe).
- This CNN story about the process of moving Paxlovid to the commercial market, with an ample, government-provided safety net, does a good job of explaining what will happen starting early next year. You’re going to see every major outlet write a story very much like this one, so you might as well read the CNN piece and just ignore the mini-deluge to come.
- I’ll be honest: I don’t entirely understand the mechanics here, but the National Community Pharmacists Association has formed a new company designed to sue PBMs to fight to get fees back from the payers. Good news for lawyers, at a minimum.
- Bernie Sanders is apparently considering hauling drugmakers back to the Hill to grill ‘em on the gap between U.S. and international prices.
- Speaking of how things are going outside the United States, Merck’s Dean Li became the latest exec to warn a European country (in this case, the UK) that the ecosystem over there isn’t exactly conducive to investment, per this Financial Times story.
- Teva is suing the state of Colorado over a new state law that requires the company to send free Epipens to pharmacies that dispense Epipens to uninsured residents. Coverage makes the point that some of Teva’s arguments mirror claims made in the IRA lawsuits.
