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Huge Seller Price Slash to Hit Nexium/Takecab; Rituxan, 8 Other Brands to Face Market Expansion Re-Pricing
(Jan.18.2018)

Chuikyo General Assembly Meeting on Jan. 17
AstraZeneca’s acid reflux drug Nexium (esomeprazole) and its rival Takecab (vonoprazan) by Takeda Pharmaceutical will be slapped with a price slash of up to 25% in Japan in April 2018 as a key reimbursement policy panel has approved the application of the “special expansion” re-pricing rule for these drugs.

The Central Social Insurance Medical Council, better known as Chuikyo, on January 17 approved a list of drugs that will be subject to special re-pricing rules, including the “special expansion” re-pricing, also dubbed “huge-seller” re-pricing (See List).

The huge-seller re-pricing pares NHI prices by up to 25% if products post annual sales of 100-150 billion yen that are at least 1.5 times their sales projections, and up to 50% if they record annual sales exceeding 150 billion yen and at least 1.3 times their sales outlooks.

Nexium will face this rule as its NHI price-based sales apparently crossed the 100 billion yen threshold (although the drug’s financial-based FY2017 sales forecast stood at 92 billion yen), and fell under the 1.5-fold condition.

Takecab, meanwhile, will be subject to the same rule because it has a pharmacological profile similar to Nexium, with its initial listing price set by referring to the AZ drug as one of its comparator products. On a financial basis, Takecab logged sales of 34.1 billion yen in FY2016 (FY2017 projection undisclosed).

In accordance with the rule, the two drugs will see their prices cut by up to 25%. However, specific reduction rates under these special rules, which also include the market expansion re-pricing and dosage and administration change re-pricing, will not be disclosed until early March, when the Ministry of Health, Labor and Welfare (MHLW) announces revised drug prices for listed products.

The huge-seller rule hit Gilead Sciences’ hepatitis C meds Sovaldi (sofosbuvir) and Harvoni (ledipasvir + sofosbuvir) with a 30%-plus cut when it was first rolled out in FY2016 because Sovaldi broke the 150 billion yen sales mark. For the upcoming revision, no drug fell under the 150 billion yen conditions.

Market Expansion Re-Pricing for 9 Brands

Meanwhile, nine brands (18 products) including Zenyaku Kogyo/Chugai Pharmaceutical’s Rituxan (rituximab), Novartis Pharma’s Afinitor (everolimus), and Nippon Shinyaku’s Vidaza (azacitidine) will face price cuts under the market expansion re-pricing. Sandoz/Kyowa Kirin’s Rituxan biosimilar, which was launched on January 18, will also be subject to this re-pricing.

The price reduction rate under the rule is up to 25% for products priced by the cost calculation method for their initial listing, and up to 15% for products priced by the comparator method. Of the nine brands, Shionogi’s Cymbalta (duloxetine) and Sumitomo Dainippon Pharma’s Trerief (zonisamide) were priced by the comparator method, and the other seven by the cost calculation method. Meanwhile, price reduction rates will be eased for Rituxan and Novartis’ Revolade (eltrombopag) with a correction premium of 5% thanks to their addition of orphan indications.

The market expansion re-pricing is also applied to drugs that have similar pharmacological profiles as products that originally fell under the rule. However, Asahi Kasei Pharma/Janssen Pharmaceutical’s Toledomin (milnacipran) and Pfizer’s Effexor (venlafaxine), which are similar to Cymbalta, escaped the rule due to their poor market competitiveness, so was Eisai’s NerBloc (botulinum toxin type B), a drug similar to Botox (botulinum toxin type A).

Opdivo, Keytruda, Bavencio

In the meantime, Ono Pharmaceutical’s PD-1 inhibitor Opdivo (nivolumab) will face the dosage/administration change re-pricing rule due to its dosage change in line with the addition of a lung cancer indication in 2015 to its initial melanoma indication. MSD’s PD-1 inhibitor Keytruda (pembrolizumab) and Merck Serono/Pfizer’s PD-L1 inhibitor Bavencio (avelumab), which were initially priced by referring to the Opdivo price, will also be caught by the rule.
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