Genentech Offering Secret Rebates

An article in today's NY Times reports that Genentech has begun offering secret rebates to eye doctors as an apparent inducement to get them to use more of the company's expensive drug Lucentis [ranibizumab] rather than a less costly alternative.

Doctors can earn up to tens of thousands of dollars in rebates each quarter if they use a lot of Lucentis and if their usage increases from the previous quarter, according to a confidential document outlining the program that was obtained by the New York Times. The rebates are considered a form of volume discount, and have been offered for some other drugs, but "some doctors said they had ethical concerns about the arrangement.

Genentech, which is owned by the Swiss company Roche, said in a statement, “Rebate and discount programs are a common business practice across the industry, including in the field of ophthalmology.” The company said it had such programs for other drugs and that they “help reduce the cost of our medicines for hospitals, pharmacies and doctors.”

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Medicare Could Save $500 Million By Switching Drugs For AMD Treatment

Wall Street Journal reports that Medicare could achieve an annual savings of at least $500 million by switching from Lucentis (ranibizumab) to Avastin (bevacizumab) for the treatment of wet age-related macular degeneration (AMD).

After examining data on some 200,000 patients on Medicare, researchers found that expenditures for Avastin averaged about $42 per dose per eye, compared to $1,593 for a dose of Lucentis.

These study results have not yet been submitted to a medical journal for peer review, a fact that troubles Sen. Herb Kohl (D-WI), who chairs the Senate Committee on Aging. Kohl stated, "It is baffling that CMS would delay the release of this data when there are hundreds of millions of taxpayer dollars at stake.

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The Wall Street Journal "Health Blog" reported that the Centers for Medicare & Medicaid Services (CMS) appears late yesterday to have changed its mind about reimbursement for small amounts of Avastin [bevacizumab], which physicians use to treat patients with age-related macular degeneration (AMD).

Avastin, which is similar to Lucentis [ranibizumab], is used off-label to manage AMD, but unlike Lucentis, which costs approximately $2,000 per injection, Avastin costs only about $30 per injection, making it considerably cheaper. Late yesterday, however, CMS announced without explanation that as of Jan. 1, it will reverse its Oct. 1 decision to reimburse Avastin at approximately $7 per dose, and will return to its previous higher reimbursement for the drug.

MedPage Today explained that even after CMS lowered its reimbursement for Avastin on Oct. 1, "reimbursement for Lucentis...remained unchanged at a whopping $2,039," thereby creating "a disincentive for using a drug that has been estimated to save Medicare $1.5 billion each year in treating macular degeneration alone.

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About 200,000 new cases of advanced, age-related macular degeneration (AMD) are identified each year in the United States, many older Americans with more severe or "wet" forms of AMD endured inevitable, gradual loss of central vision.
Lucentis in clinical trials has been shown to stop and, in many cases, reverse at least some vision loss in most people with advanced AMD. Another drug closely related to Lucentis, known as Avastin (bevacizumab), also has been shown to be a highly effective and far cheaper alternative for lower-income individuals with advanced AMD.
The problem is that Avastin is FDA-approved only for treatment of colon and other cancers, but not for macular degeneration. As an alternative, many eye doctors have been using Avastin as an "off-label" treatment.
Pharmaceutical companies are driven by financial intersts, while physicians with patient care. Here is an excellent article that summarizes it.

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