[Updated 10/17/18, 2:52 p.m. See below.] Express Scripts has just exerted its influence over the emerging market battle between drug makers trying to sell a new class of migraine-preventing medicines. The pharmacy benefits manager (PBM) is excluding a new drug from Teva Pharmaceutical from coverage while favoring two rival treatments instead, according to a report from Reuters.
According to the report Wednesday, Express Scripts (NASDAQ: ESRX) has added erenumab (Aimovig), from Amgen (NASDAQ: AMGN), and galcanezumab (Emgality), from Eli Lilly (NYSE: LLY), to its formulary, a list of covered drugs. The company, which manages the pharmacy benefits for employers, says its drug plans cover more than 100 million people. The Teva (NYSE: TEVA) drug fremanezumab (Ajovy), meanwhile, has been shut out.
Express Scripts issued a statement saying the coverage decision was part of a new program to identify patients who are heavy users of migraine treatments and move them onto the new class of migraine therapies, which have been shown in clinical trials to reduce the frequency of headaches. The new program is scheduled to begin in April. Teva said it was disappointed with the formulary decision, adding that it priced its drug in line with the recommendation from the Institute of Clinical and Economic Review, a drug price watchdog. [Paragraph updated with comments from Express Scripts and Teva.]
The Express Scripts decision comes a month after the FDA approved fremanezumab. The drug is part of the first new class of migraine drugs to reach the market since the FDA approved triptans in the 1990s. These drugs are meant to reduce the frequency of migraine headaches unlike triptans, which treat migraine attacks that have already begun.
All three drugs—known as calcitonin gene-related peptide (CGRP) inhibitors for the pain-signaling protein they block—won FDA approval this year. Amgen’s drug hit the market first, and the Thousand Oaks, CA, company set a list price that its two rivals have matched: $575 a month, or $6,900 a year.
While all three are injectable drugs that block CGRP, there are a few differences between them. Fremanezumab, like its rivals, is a monthly injection. But Teva was also cleared to sell a second version that’s given every three months—making the drug maker the only company to offer quarterly dosing. Additionally, following the approval of Lilly’s migraine drug last month, Evercore ISI analyst Umer Raffat noted that some patients treated with the Amgen drug have experienced constipation, which has not been reported as a side effect for either the Teva or Lilly drugs. But fremanezumab comes as a pre-filled syringe, which may be harder for some patients to administer than the auto-injectors used with the Amgen and Lilly drugs, wrote Leerink Partners analyst Ami Fadia.
These differences don’t appear to have factored into Express Scripts’s decision, however. Harold Carter, clinical solutions director for Express Scripts, told Reuters that the three migraine drugs are “fairly interchangeable.” He added that the decision to include the Amgen and Lilly medicines and lock out Teva came down to providing value, including rebates from the drug companies. But he declined to say how much of a rebate each company offered. (A rebate is a confidential discount from a drug’s list price that is negotiated between a drug maker and the pharmacy benefit manager. The price difference can reduce the out-of-pocket costs for patients, but more often it’s split between the sponsors of the insurance plan and the PBMs.)
Starting next April, Amgen and Lilly have also offered to refund a percentage of the list price of their drugs to Express Scripts clients if they don’t work or cause too many side effects, Reuters reported. Express Scripts cut a similar deal with Regeneron Pharmaceuticals (NASDAQ: REGN) earlier this year over the Tarrytown, NY, company’s cholesterol-lowering drug alirocumab (Praluent).
“This puts more pressure on Teva to score formulary wins in the other larger plans, which at this point may still be up for grabs,” Fadia wrote.
Amgen’s drug has encountered challenges in securing reimbursement, with some insurance companies establishing requirements that patients first try one or more older migraine drugs, or that patients get prescriptions from a headache specialist. Some large drug pricing middlemen, such as CVS Caremark and OptumRx, have yet to announce whether they’ll cover the new migraine drugs. But patients can still get all three, at least in the near term. Amgen, Lilly, and Teva each have temporary programs in place providing the drug to patients for free—as long as they provide documentation from a physician explaining that the treatment is medically necessary. These programs are intended to help the drug makers build patient and physician awareness of their respective drugs while the companies work to secure insurance coverage.
In a Wednesday research note, Raffat observed that Teva’s free drug program is 15 months long, which means it will last through 2019. The company could use that time to continue pressing its case with Express Scripts in hopes of winning coverage in 2020, he said.