AstraZeneca's Bloodthinner Pricing Questioned

| About: AstraZeneca Group (AZN)

File this under a not-so Brilinta move? Now, that the FDA has finally approved Brilinta, a bloodthinner developed by AstraZeneca (NYSE:AZN) that had to overcome a curious hurdle, the drugmaker has set its pricing. But one Wall Street analyst questions whether AstraZeneca may have priced itself out of the market.

To wit, Brilinta will cost about 19 percent higher, on a wholesale acquisition basis, than Plavix, the leading bloodthinner, which faces generic competition next May. Moreover, the Brilinta labeling suffers from a Black Box warning that may give physicians a reason to use Plavix, according to Sanford Bernstein analyst Tim Anderson. An AstraZeneca spokesman confirmed that daily WAC pricing is $7.24 which, by the way, will be about 25 percent higher than Eli Lilly’s (NYSE:LLY) Effient.

“This price seems high to us given the competitive dynamics in the antiplatelet category,” Anderson writes in an investor note. What are those dynamics? The Black Box says docs should use only low doses of aspirin with Brilinta. Other bloodthinners do not carry this edict, which results from the findings of a clinical trial that yielded an unexpected adverse finding only in U.S. patients (see here).

The drugmaker explained this by claiming results from U.S. patients were confounded by the use of high-dose aspirin. And so the FDA approved Brilinta last week, but recommended that patients use only low-dose aspirin (read this). Anderson points out, though, that this is “a potential problem, given that most US physicians prefer high dose aspirin.”

“With a less-than-ideal label, and given the short window AstraZeneca has to get Brilinta established given the pending generic launch of Plavix in the U.S., coming out with a premium price seems like it will give payers one more reason to push Plavix ahead of Brilinta. In less than a year from now, generic versions of Plavix will be available for pennies on the dollar, creating a substantial price differential between generics and Brilinta.”

An AstraZeneca spokesman disagrees. “Brilinta will be priced to reflect the label and its value in treating patients with ACS (acute coronary syndromes). AstraZeneca believes Brilinta should be priced at a premium because of its label and the safety and efficacy versus clopidogrel,” he writes us. “The cost to an individual patient will differ depending on an individual patient’s insurance status.”

As for the claim about the label that is used to justify the higher price, he points to this wording: “Brilinta has been shown to reduce the rate of a combined endpoint of cardiovascular death, myocardial infarction or stroke compared to clopidogrel,” or Plavix. Will this be sufficient to convince payers? Perhaps the AstraZeneca team should take two aspirin and call the formulary gatekeepers in the morning.

Disclosure: None