Valeant Pharmaceuticals' drug price hikes in crosshairs of U.S. Congress

Quebec-based Valeant Pharmaceutical's price hikes of drugs long off patent has raised the ire of U.S. legislators and frustrated Canadian physicians.

Democrats on the House of Representatives committee on oversight and government reform sent a letter Monday to the committee's Republican chairman seeking a subpoena that would force Valeant to turn over documents tied to the U.S. price hikes of two heart drugs.

In the U.S., the price of Isuprel or Isoprenaline increased 2,500 per cent and Nitropress went up 1,700 per cent in three years, as the drug changed hands. Not all of those price increases were Valeant's doing, but a significant part of them were. Valeant purchased the rights to both heart drugs from Marathon Pharmaceuticals in February, and then further boosted the price of Isuprel almost six-fold and Nitropress almost four-fold, according to the Democrats.

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As huge overnight drug price hikes becomes an election issue in the U.S.,  some doctors in Canada struggle to get other prices rolled back.

Dr. Eve Roberts is a former liver specialist at the University of Toronto who has written about prices of essential drugs. She's treated patients who were affected by an increase in the price of one of Valeant's medications in 2013.

"I am still feeling quite traumatized by what happened to my patients and I feel traumatized for patients in similar situations," Roberts said in an interview Tuesday from Halifax.

Tablets of Syprine or trientine are a second-line drug for Wilson's disease. 

In late 2013, Valeant Canada announced that as of January 2014, the price of a one-month supply of Syprine would match the U.S. price of roughly $13,244, or about 13 times higher than the previous price.                   

Most patients take three or four tablets a day. The medication makes the difference between a full and productive life or a downward course of increasing liver and neurological disease, Roberts said.

Liver specialists and pharmacy groups drew attention to the price hike problem, including an editorial in the Canadian Journal of Gastroenterology and Hepatology.

"When push came to shove, the price was rolled back," Roberts recalled. "It was a bad increase for the professionals. It was a terrible experience for the patients."

Price rise 'intolerable' for patients

For physicians, the price increase put them in the position of having to tell patients their disease can be managed or cured but at an out-of-pocket price of $200,000 a year for the rest of their lives.

"To see these prices rise capriciously and suddenly is just intolerable for these patients," Roberts said.

In the U.S., Democratic presidential hopefuls Bernie Sanders and Hillary Clinton have campaigned on lowering drug prices.

"It is unacceptable that while millions of Americans cannot afford the prescription drugs that they need, the top pharmaceutical companies made a combine $45 billion in profits last year and spent more on sales and marketing then they did on research and development," Sanders, a senator from Vermont, said earlier this month.

"It is time for the United States to join the rest of the industrialized world by implementing prescription drug policies that work for everybody, not just the CEOs of the pharmaceutical industry."

Democrats say Valeant is using the same business model as former hedge fund manager Martin Shkreli, whose company increased the price of a medication called Daraprim to $750 US from $13.50 US after buying the company that owned the rights.

"We believe it is critical to hold drug companies to account when they engage in a business strategy of buying old neglected drugs and turning them into high-price specialty drugs," the committee letter said.

Steve Morgan, a  drug policy analyst at the University of British Columbia, is writing a commentary about Valeant.

"One of the responsibilities that comes with monopoly power, such as that which is provided by patents, is to resist abusing the power so much that government feels it must intervene," Morgan said in an email.

Policy intervention could come in the form of regulation of drug prices or compulsory licensing of drug patents.

"If such responses are provoked and effective, the sector as a whole might have preferred that conventional thresholds of value-for-money pricing had been respected all along," he added. 

Valeant didn't respond to requests for comment from CBC News.

Chief executive Michael Pearson told employees in a letter Monday that Valeant's business model doesn't rely on large price increases and that political pressure won't harm the company.

"Valeant is well-positioned for strong organic growth, even assuming little to no price increases," he wrote in a letter, adding that products like these two in question have historically seen price increases.