Saturday, December 01, 2012

Proprietary drugmakers go coupon route

The Atlanta Journal-Constitution outlines the coupon strategy of proprietary drug companies concerning drugs facing patent expiries in the post titled
New coupons aim to keep people off generic drugs

Brand-name drugmakers say they don’t just cut their prices when generics arrive because insurance plans would get all the benefit. Coupons instead give loyal patients savings of as much as $100 a month — often even if they don’t have insurance. That makes the brand more affordable for patients who want to stay on it.

For example, a month’s supply of brand-name Lipitor costs about costs about $175 without insurance. For insured patients, the copayment is typically $25 to $50, well above the average copayment of about $10 a month for a generic drug.

Under Pfizer’s Lipitor For You coupon program, Pfizer absorbs up to $75 of the patient’s out-of-pocket cost. Insured patients pay only $4 a month — less than a generic drug copayment — unless their copayment is higher than $79 a month; the insurer pays the remaining cost. Uninsured patients get the $75 off each prescription and then pay the remaining $100 or so.

While the deal slashes Pfizer’s profit, the company still makes more money than it would if all its customers defected from Lipitor to a generic. Ian Read, CEO of New York-based Pfizer, recently said the strategy on Lipitor alone brought the company hundreds of millions of dollars in extra profit. He called the program “a great success.”


The AJC post does not note that some health insurance companies insist on the use of substitution of still-lower cost generics. For example, losartan for valsartan (Diovan). See IPBiz post
Ranbaxy's Lipitor copy goes on sale, but...
. Separately, as to Ranbaxy's version of Lipitor ( atorvastatin ), note text from BusinessWeek in the post
Drugmaker Ranbaxy halts generic Lipitor production :

Problem-plagued Ranbaxy Pharmaceuticals Inc. has halted production of generic cholesterol drug Lipitor while it investigates how tiny glass particles got into the ingredients used for dozens of batches of the drug that were recalled in November. It was Ranbaxy's second recall of the drug, called atorvastatin, since August.

The Food and Drug Administration said Ranbaxy won't resume manufacturing atorvastatin until it determines the cause of the latest problem and fixes it.

And from India's Ranbaxy probes 'possible' glass in drug

Daiichi Sankyo bought control of the Indian firm [Ranbaxy in 2008] to diversify globally and to break into the fast-growing generics market.

But Daiichi Sankyo faced an uphill battle to turn around Ranbaxy after US authorities alleged the company falsified data, failed to prevent contamination of medicines and kept poor records.


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