David Mitchell's Misleading and Deceptive Attack on Celgene

David Mitchell is the founder of a group called Patients for Affordable Drugs.  He claims he is a consumer advocate crusading against high drug prices.  In fact, Mitchell's organization received a large grant from the Laura and John Arnold Foundation.  P4AD is part of a syndicate of think tanks, advocacy organizations and media outlets the Arnold Foundation is funding to the tune of $25 million.  (For the record, CMPI receives funding from pharmaceutical and biotech firms. )

As for attacking drug companies, it turns out Mitchell took $12 million from pharmaceutical companies to run campaigns in support of the Affordable Care Act.   

Perhaps because he is running a political operation like he did for Obamacare, he cares little about facts or context.  But I do.  And I hope the reporters that now have Mitchell on their Twitter feed do are asked to buy his deceptive narrative do so as well. 

And the fact is Mitchell's sob story about Revlimid doesn't add up. 

He claims his co-pay for Revlimid - the myeloma drug Mitchell takes went from $42 to $250 over the last few years while the list price of Revlimid jumped from $8,000 to $10,691 for a four-week supply over the same time period.  Ergo, his co-pays climbed in response to the price increase. 

But that means the list price increased by 33 percent while the copay increased 500%.   The list price is set by Celgene, but the copay is set by health plans.  So the co-pay increase exceeded the list price increase by a factor of 15.  

Also, since Medicare covers a large portion of spending novel cancer therapies, PBMs also generate rebates and other fees not passed on to the patient.   Such Medicare rebates are about 15-20 percent of the retail price according to recent estimates. 

That means that the PBMs got another $536 per month from Celgene.  Remember that the co-pay increased to $250.  So that means the PBMs did not pass on the rebate and indeed collected more co-pays while pocketing the rebate money.   Moreover, Celgene offers copay assistance to people who can't afford the increase in out pocket cost.  In fact, a study found that "after financial assistance, 86.2% of patients had a direct cost of less than $50 per prescription. That money goes to the PBMs too.   Either way, the PBMs collect an additional $9432 a year from people in Mitchell's plan.    

And yet all Mitchell can think of doing is suing Celgene? 

Mitchell is claiming Celgene is blocking the production of a generic form of Revlimid by refusing to provide generic companies with samples to base production on.  Mitchell also claims that as a result,  his co-pays would go down. 

Let's deal with latter claim first. Indeed, if Revlimid went generic, there is no guarantee that it would reduce out of pocket costs.  PBMs have placed several generic cancer and HIV drugs on the highest cost sharing tier in the past.  Moreover, PBMs -- who set the price of generics when they sell them at drug stores -- mark up the prices.  In addition, they charge a co-pay that often exceeds the cost of the medicine.  Again, Mitchell is silent on these practices.  

Secondly, and contrary to Mitchell's claim, Celgene HAS been working with generic companies to provide their medicines.  As Erika Lietzan Associate Professor of Law, University of Missouri School of Law wrote: "Notwithstanding the rigorous REMS protocol, Celgene has provided Thalomid to generic drug companies that want to develop and test generic copies of the drug and that agree to Celgene’s risk mitigation policies. Celgene has done so when those companies provided documentation and information confirming steps and safeguards that would not only prevent fetal exposure but also minimize the risk for Celgene’s business and reputation, such as risk from products liability litigation. Mylan—one of the generic companies—has declined to provide information requested by Celgene, however, and instead filed an antitrust suit that is still pending in federal court."

Suing Celgene is just a publicity stunt to Mitchell.  But wiping out patent life  would eliminate any future investment.  Over the past few years, Celgene was investing hundreds of millions of dollars in clinical trials to demonstrate the clinical benefit of Revlimid to newly diagnosed myeloma patients.  That will stop when the product goes off patent.   Generic companies don't invest in the future, only the past.  If Mitchell were honest, he would acknowledge that and much more.