Eli Lilly and Co. and its peers are increasingly clashing with pharmacies in an effort to keep patients buying their brand-name
drugs.
Indianapolis-based Lilly recently rejected CVS Caremark’s demands for big price discounts on its insulins, Humalog
and Humulin, according to The Wall Street Journal. In response, CVS kicked Lilly’s insulins off the list of
medicines it recommends to the employers and health plans for which CVS acts as a pharmacy benefits manager.
Being off the list could prompt CVS’s clients not to cover Lilly’s insulins, because they would get a smaller
rebate on the drugs, the Journal reported. CVS said customers could get insulins made by Novo Nordisk A/S for less
money.
"In light of the aggressive pricing required to win this business—and the fact that only a small percentage of
Lilly's insulin franchise would be impacted by this change—we ultimately decided it did not make good business sense
for Lilly to be included," Lilly officials said in a statement.
Last year, Lilly underbid Denmark-based Novo Nordisk to win an exclusive contract to provide the insulins sold by Wal-Mart
Stores Inc. under its ReliOn brand name.
In another battle that could set a precedent for the industry, New York-based Pfizer Inc. has tapped an outside firm to set
up a mail-order pharmacy so it can sell the cholesterol drug Lipitor directly to consumers.
Even thought Lipitor loses patent protection in the United States on Wednesday, Pfizer will offer the drug at a price that
has a similar co-pay to its new generic competitor, atorvastatin. Some pharmacy benefit mangers, such as New Jersey-based
Medco Health Solutions, have agreed to lower Lipitor co-payments to the price of a generic and reject claims for atorvastatin.
"Previously, Big Pharma has tended to walk away" from top-selling drugs once they lose patent protection, Pfizer
CEO Ian Read told the Journal. "Now, we have a flat-out different culture."
If Pfizer’s plan retains even a fraction of Lipitor’s $13 billion per year in worldwide sales, it may prompt
other companies facing giant patent expirations—which would include Lilly—to follow suit.

















IBJ Conversations
0 Comments
Add Comment