May 12, 2023

The need-to-know this morning

The Food and Drug Administration is convening a meeting of outside experts to review clinical data on an experimental gene therapy for Duchenne muscular dystrophy from Sarepta Therapeutics. The stakes for this all-day meeting are high and deliberations could be contentious. The meeting starts at 9 a.m. ET and STAT reporters Adam Feuerstein and Jason Mast are live-blogging the proceedings all day.

taxation

Probing the low, low tax rates for drug makers

Tax rates have gotten "astonishingly low" for some of the biggest pharma players, Sen. Ron Wyden (D-Ore.) says. Thanks to changes in tax law enacted six years ago, the average tax rate for seven of the largest drugmakers fell by 40% — dropping from 19.6% in 2016 to 11.6% in 2020. And in 2017, a new law passed that permanently lowered corporate tax rates from 35% to 21%. Even so, most of their profits were moved offshore to avoid paying U.S. taxes, a Senate committee memo says.

"There's no question that the tax system was broken prior to 2017, but instead of fixing it, Republicans gave Big Pharma a green light for some of the most aggressive tax gaming highly trained accountants can dream up," Wyden said. "[Drugmakers] charge Americans sky-high prices and they pay absolute rock-bottom taxes, not anywhere near a fair share."

Wyden is leading an investigation into industry tax practices. It's part of a wider Washington effort to uncover what, exactly, is causing drug costs to continually skyrocket.

podcast

Is there a Bermuda Triangle of drug prices?

Do FDA advisers matter? And when should biotech companies throw in the towel? We cover all that and more this week on "The Readout LOUD," STAT's biotech podcast.

We discuss a Senate hearing that put major pharma CEOs in the same room with the middlemen they love to blame for rising drug prices, with mixed results. We also explain what is a massive week for Sarepta Therapeutics, the FDA, and the future of gene therapies for rare diseases, plus the latest news in the life sciences.

Listen here.

alzheimer's

A new tool for Alzheimer's agitation

Another drug for Alzheimer's disease has just won a supplemental U.S. approval. Rexulti, or brexpiprazole, can now be used to treat agitation stemming from dementia. The atypical antipsychotic, made by Otsuka Pharmaceutical and Lundbeck, has been on the market since 2015 to treat major depressive disorder and schizophrenia. Rexulti is the first drug to be approved for the dementia associated with Alzheimer's disease.

Atypical antipsychotics like Rexulti were slapped with a black box warning in 2005, BioSpace points out, when a meta-analysis showed a 70% increased risk of death among elderly patients. But an April advisory committee voted 9-1 to approve the drug for Alzheimer's, based on three Phase 3 studies showing that the benefits of decreasing agitation offset the increased risk of death. Across the studies, eight of the 655 patients given Rexulti died. In comparison, only one volunteer out of the 388 given placebo died.

Washington

Senate passes more drug pricing bills

The Senate health committee passed a set of bills meant to bolster generic drug competition and curb the questionable business practices of drug middlemen. But an ambition plan to reform pharmacy benefit managers failed to pass, although it had strong bipartisan support.

The committee voted 18 to 3 to ban PBMs from using spread pricing — the PBM practice of charging insurers more than they pay pharmacies — requiring them to disclose rebates, fees, and other payments they receive and pass them on to the insurers that they work with. It also passed three generic drug bills, including one that ensures companies only get market exclusivity for approved indications.