By Michael Erman and Bhanvi Satija
NEW YORK (Reuters) – Pfizer Inc chief executive Albert Bourla called U.S. plans to negotiate drug prices for its Medicare health program “negotiation with a gun to the head” and said he wait for the drug companies to sue in an attempt to stop the process.
“It’s not negotiating at all. It’s price-fixing,” Bourla told a Reuters news event on Thursday, referring to the Biden administration’s signature drug pricing reform, part of the Inflation Reduction Act (IRA). The law aims to save $25 billion through price negotiations by 2031 for Americans who pay more for medicines than any other country.
The pharmaceutical industry says the law, passed last year, will result in lost profits that will force drugmakers to withdraw from developing innovative new treatments.
The companies have begun laying groundwork to fight the US plan, Reuters reported earlier this week.
“I think there will be legal action,” he said, adding that he’s not sure that will stop the plan before the new prices go into effect in 2026. Bourla also said he’s not optimistic that Congress will take action to change the law.
Drugs likely to be among the first to be traded include Pfizer’s breast cancer treatment Ibrance and blood thinner Eliquis, which Pfizer shares with Bristol Myers Squibb.
Bourla acknowledged some positive aspects of the law for patients, such as lower out-of-pocket costs for medicines.
A spokesperson for the US Centers for Medicare and Medicaid Services (CMS), which will oversee drug pricing talks, said in an emailed statement: ‘We have regularly engaged with stakeholders, including manufacturers, health plans and patient groups, to gather input and feedback during implementation.”
After considering the comments received, the agency said it “will issue revised guidance in the summer of 2023.
Bourla is looking to shift Pfizer’s focus away from COVID-19 vaccines and treatment that have placed the company at the forefront of the pandemic response and led to a once-in-a-lifetime increase in revenue.
The company is in the midst of a sharp but expected decline in sales of COVID products and is also bracing itself for declining revenues in the coming years for some of its top-selling drugs as they begin to face competition from cheap generics.
As a result, investors are looking for Pfizer to produce blockbuster new drugs that can earn billions each year, both from the company’s pipeline of drugs in development and through deals.
Bourla led Pfizer as the New York-based drugmaker raced alongside German partner BioNTech to develop a vaccine for COVID as much of the world went into lockdown in 2020. The company also developed Paxlovid, a lifesaving antiviral treatment for the illness.
COVID products drove Pfizer’s revenue to record highs, surpassing $100 billion in 2022 and $80 billion in 2021.
“Pfizer is giving all the profits we made from COVID in ’21 and ’22 and what we make in ’23 to acquire technology and products that we believe will allow us to fight cancer,” he said, calling the drugmaker’s effort “next moonshot.”
‘THIS IS NOT ABOUT ABORTION PILLS’
Bourla has overseen a series of acquisitions to bolster Pfizer’s drug pipeline, most notably the $43 billion deal for Seagen, which makes complex targeted cancer therapies.
The drugmaker also spent billions on purchases of migraine drugmaker Biohaven Pharmaceutical, ulcerative colitis drug developer Arena Pharmaceuticals and Global Blood Therapeutics, maker of a sickle cell disease treatment.
Bourla said he plans to close only modest-sized deals in the near term as he focuses on integrating Seagen.
As the company works to develop new drugs, Bourla has expressed concern about a recent ruling by a Texas judge that suspended the 2000 approval of the abortion pill mifepristone by the US Food and Drug Administration. The US Supreme Court suspended the order, leaving the drug used in more than half of US abortions on the market while the case is on appeal.
Bourla signed an open letter from hundreds of industry executives asking the Supreme Court to reverse the Texas judge’s decision. On Thursday, she called the FDA “the most iconic regulatory body in the world” and said citizens can trust that regulators have done the work to confirm whether drugs are safe.
“It’s not about abortion pills … It has to do with a judge’s ability to tell if a drug is safe and effective,” Bourla said. “This undermines the entire trust system.”
(Reporting by Michael Erman in New York & Bhanvi Stija in Bangalore; Editing by Bill Berkrot)
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