New cholesterol drugs could add $120 billion to annual U.S. health costs

Promising new cholesterol-lowering drugs, priced at $14,000 a year per person, could add $120 billion annually to the USA's health care costs if taken by all eligible patients, according to an economic analysis published Tuesday in JAMA. 

Authors of the analysis said they hope the estimate will spur a national conversation about drug prices, the value of new medications and how much Americans are willing to pay to improve health. 

The new drugs are called PCSK9 inhibitors, and they can reduce LDL cholesterol, which can contribute to heart attacks, by up to 60%, said Dhruv Kazi, assistant professor of medicine at the University of California-San Francisco and lead author of the new study.

Use of the drugs is already lower than many expected as a result of push back from insurance companies and pharmacy benefit managers, who have placed strict limits on use of the medications.

The Food and Drug Administration approved the drugs last year for people with a strong family history of extremely high cholesterol, as well as those who have suffered heart attacks or strokes due to cholesterol buildup in their arteries. 

PCSK9 inhibitors are also approved for those who either cannot tolerate statins — a common cholesterol therapy — because of muscle pain or liver problems, or who cannot sufficiently lower their cholesterol levels on statins alone. 

The drugs — Praluent, made by Sanofi and Regeneron Pharmaceuticals, and Repatha, made by Amgen — pack a one-two punch when it comes to costs, Kazi said. Unlike cancer therapies, which can cost $100,000 a year or more but may be used by only a few thousand people, the new cholesterol drugs could be used by 9 million Americans ages 35 to 74, he said.

And unlike new drugs for hepatitis C, which cost $1,000 a pill but are used for 12 weeks, the new cholesterol drugs are meant to be taken for the rest of a person's life, Kazi said.

Treating all eligible patients with Repatha or Praluent would increase annual health spending in the U.S., now at $2.8 trillion, by an additional 4%, an "astronomical" amount for a single medication, Kazi said.

Hala Mirza, a spokesperson for Regeneron, said the new economic analysis overestimates the cost of the new drugs. "This is the latest in a series of analyses that do a major disservice to patients via dramatically overstated predictions on the cost burden of PCSK9 inhibitors," Mirza said. 

Insurers have sharply restricted use of the new cholesterol drugs because of analyses that predict they will cause health care costs to soar, Mirza said. Insurers have blocked access to Praluent for about 75% of patients whose doctors wrote prescriptions for the drug, Mirza added.

Insurer Cigna covers both Praluent and Repatha, and reached agreement in May with both of the drugs’ manufacturers to get a “very competitive discount” that would be slashed even more if the drug doesn’t perform as well as it did in clinical trials, said Christopher Bradbury, senior vice president of Cigna Pharmacy, which manages the prescription benefits for customers with Cigna insurance. The company has formed agreements like this for eight years on drugs for other conditions including diabetes and hepatitis C.  

With such high priced breakthrough drugs, Bradbury said it’s important to hold pharmaceutical companies accountable and so Cigna can best decide just who should get the medicine. Right now, it’s a “very, very small portion of the population” such as those with a certain type of genetic makeup, he said. 

FDA approves new cholesterol drug - at $14,600 a year

The study also found Praluent and Repatha failed a standard test for being cost-effective, because they cost more than $100,000 for every year of healthy life saved, a measure that considers the quality of a person's life. To meet the standard, the drugs' prices would have to be reduced about 70%, to around $4,500 a year, a price that's closer to the medications' cost in Europe, Kazi said. European governments commonly negotiate drug prices for their countries with pharmaceutical companies.

Steven Nissen, chairman of cardiovascular medicine at the Cleveland Clinic, said it's misleading to try to calculate whether these drugs are cost-effective, because their full benefits aren't yet known. Although Praluent and Repatha can dramatically lower cholesterol levels, no one knows if they will accomplish the much more important goal of actually preventing heart attacks and strokes.

Cardiologist Cam Patterson said he's only prescribed the drugs for one patient, although he treats hundreds with cholesterol disorders. Patterson said he had to work hard to get an insurance company to pay for the medication.

"There is no doubt that there are high-risk patients who are in grave danger who need PCSK9 inhibitors now," said Patterson, chief operating officer at NewYork-Presbyterian Hospital/Weill Cornell Medical Center. "But they're really a handful of patients."

Studies evaluating the drugs' impact on heart disease aren't scheduled to be released for several months, Nissen said. "Pharmacy benefit managers will do anything to keep people from getting these drugs, because they are expensive," he said.

But the cholesterol drugs aren't just expensive for people who take them, said Ceci Connolly, CEO of the Alliance of Community Health Plans, which represents not for profit community health insurers owned by doctors and hospitals. The high costs hurt consumers “because what happens is people who don’t need get them, which increases health insurance premiums for everyone,” Connolly said.

Taxpayers are also on the hook for higher drug costs, Kazii said, noting that Medicare, the government insurance program for seniors, covers 55 million people.

Praluent and Repatha are the first new type of cholesterol-lowering medication to hit the market since statins were released in 1987. Other drugs in this class are in development.

In spite of all the interest in expensive cholesterol drugs, Kazi notes that about 30% of people who could benefit from a statin aren't taking one. Treating these patients with statins, which cost $200 to $600 a year, could actually save $2.4 billion a year, mainly by preventing hospitalizations due to heart attacks and strokes, Kazi said.

About 365 patients could be treated with a generic statin for the price of putting one patient on Praluent or Repatha, Connolly said.

Contributing: Jayne O'Donnell