April 18 (Bloomberg) -- Bayer AG and Amgen Inc. are among drugmakers who may face price cuts as a German agency begins a broader review of the costs and benefits of medicines already on the market.
Bayer’s blood thinner Xarelto, Amgen’s Prolia for osteoporosis and painkillers like Nucynta from Gruenenthal Pharma GmbH and Johnson & Johnson are among the targeted products, the Federal Joint Committee decided in a meeting today. The review encompasses other treatments in the same category as each of those medicines, meaning that Boehringer Ingelheim GmbH’s blood thinner Pradaxa will also be assessed.
Today’s announcement is the first step down a path that will probably result in price cuts by mid-2014 as the agency begins a systematic review of drugs already on the market, Chairman Josef Hecken said in a press conference at the committee’s Berlin headquarters. More reviews are due to be announced by the end of the year, Hecken said.
“It’s a matter of fairness to the drugmakers” to keep broadening the scope of medicines under review now that the process has started, Hecken said.
The results of each cost-benefit assessment will form a basis for price negotiations between companies and Germany’s statutory insurers, part of a law passed in November 2010 as Chancellor Angela Merkel’s government sought to save more than 2.2 billion euros ($2.87 billion) in spending on medicines.
The committee used a formula that weighted prescription numbers as well as annual sales to determine which drugs to review first. The drugs included in today’s initial tranche may generate 5 billion euros in sales inside Germany before their patents expire, Hecken said.
Also on the list announced today were diabetes medicines Victoza from Novo Nordisk A/S and Byetta from Bristol-Myers Squibb Co., depression drugs agomelatine from Servier Laboratories Ltd. and Cymbalta from Eli Lilly & Co. and rheumatoid arthritis medications Actemra from Roche Holding AG, Simponi from Bristol-Myers and Cimzia from UCB SA.
Though price talks on newly introduced drugs started in 2011, this is the first time the agency has laid out broad plans to target medicines that were on the market before then, Kai Fortelka, an agency spokesman, said in a telephone interview before the meeting.
Pharmaceutical industry associations issued a joint statement criticizing the agency for not seeking more input from industry before starting its reviews.
“It’s absolutely necessary to have a professional dialogue about the concept and methodology” behind the reviews, the associations said in a statement posted on the website of industry group VFA, Research-Based Pharmaceutical Companies.
Bayer had expected Xarelto to be called up for a cost-benefit analysis, and had prepared, the Leverkusen, Germany-based drugmaker said in an e-mailed statement. Bayer declined to comment in more detail until the analysis is finished.
Boehringer spokesman Reinhard Malin said that the Ingelheim, Germany-based company had expected the review, and that it was confident that Pradaxa’s benefits would be shown.
Spokespeople for Amgen, Gruenenthal and J&J weren’t immediately available for comment.
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