U.S. Senator Calls for CMS Probe of 12,400% Drug Price Hike

John Commins, for HealthLeaders Media , June 8, 2011

"Yet again, a pharmaceutical company is taking advantage of FDA approval to price-gouge their customers and pad their profits," Brown said in a media release. "Because most Americans living with gout are seniors—and the average Social Security recipient receives just around $14,000 per year—a price hike to more than $3,500 per year will break the budgets of so many who depend on this drug. URL Pharma should do the right thing and put patients over their profits—particularly since their patients are those who can least afford a colossal price increase."

URL Pharma asserted that its earnings are "well below our sales numbers with about $23MM budgeted for further research on Colcrys…Please note that URL Pharma funded, and continues to fund, all Colcrys research, not NIH."

Brown noted that this is second time in the span of a few months that a major pharmaceutical company has exploited the FDA approval process. He pointed to the decision by KV Pharmaceuticals Co. to raise the price of its prenatal drug Makena from about $15 a shot to $1,500 a shot. The Bridgeton, MO-based company backed away from the decision amid intense public criticism, threats of a government investigation, and the potential challenges of getting government and insurance companies to pay.

"My overarching concern with this price increase is that this seems to be a new model for drug companies," Brown said in his letter to Berwick. "As we saw recently with the drug Makena, companies are cherry-picking medications and treatments that have been widely used but have not gone through the FDA approval process. URL Pharma, KV Pharmaceutical, and others are taking these medications through the approval process with minimal investment and are reaping disproportionate rewards for their work."

A Feb. 9, 2011 media release from the drug maker boasted of the company's "Colcrys Co-Pay Assistance Program," which it described as "an initiative designed to help patients save money on their health insurance co-payment for Colcrys." The program provided a reusable coupon that allowed reduced co-pays from $15 a month, to $25 a month.

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