Axios

Marathon Pharmaceuticals is delaying the U.S. launch of its drug recently approved to treat patients with Duchenne muscular dystrophy after its $89,000 list price stoked an uproar from Sen. Bernie Sanders, Rep. Elijah Cummings, patient groups and many who work in the industry.

Patient advocacy group Parent Project Muscular Dystrophy announced the pause, first reported by the Wall Street Journal, on Monday afternoon. The group said it was "alarmed by the hefty price tag being considered for Emflaza in the U.S., especially considering this is not a new drug."

Marathon responded that it is "taking this pause so that conversations between the company and the community can continue before a launch price is finalized." The company had said the amount it will actually receive, net of rebates and discounts, will be $54,000 annually — still a lot more expensive than what the drug costs abroad.

Why this matters: Several years ago, Marathon's drug price hike would have floated under the radar. But this is the clearest example yet of what will happen if drug companies price medications beyond what is acceptable by the public and Congress.

Sen. Bernie Sanders and Rep. Elijah Cummings have launched an investigation of Marathon Pharmaceuticals over its decision to raise the price of an annual supply of deflazacort, a steroid used to treat a rare degenerative muscular disease, to $89,000.

From their letter to Marathon's CEO: "Exorbitantly pricing potentially life-saving medications that should be widely available for a fraction of the price hinders patient access and drives up costs for the entire health care sector."

Why it matters: This is the first congressional action in the Marathon scandal, from two Democrats who have focused heavily on rising drug prices. It could signal further congressional action on the issue, an area in which President Trump has vowed action.

The Trump administration's highly anticipated Obamacare "market stabilization" regulation, which could come as soon as this week, may help insurers by tightening the enrollment rules. But that's not what's at the top of health insurers' wish list. They care a lot more about keeping the subsidies and individual mandate tax — and they want the taxes on them repealed permanently.

That was the message Blue Cross Blue Shield Association lobbyists presented at a meeting with White House and Department of Health and Human Services officials on Feb. 6. Documents housed at the White House's Office of Management and Budget reveal that the industry wants the feds to temporarily keep the individual mandate until high-risk pools are funded and there are new rules for covering people with pre-existing conditions.

They also want to repeal the Obamacare taxes and "do no harm by maintaining cost-sharing reductions." And they're reminding federal officials that the insurance industry needs to know what to expect by this spring.

John Carroll at the pharmaceutical news website Endpoints did some interesting digging on the new high-priced drug from Marathon Pharmaceuticals for Duchenne muscular dystrophy. The drug company claims that the annual $89,000 list price is justified to recoup the lofty research and development costs and that it won't be profitable for years, but Carroll found that defense probably doesn't hold up. The key points:

• Carroll consulted with two pharmaceutical industry experts, who analyzed the data and said the costs for acquiring and developing the drug were as low as $6 million and likely no more than $75 million.
• A slide from a webinar about the effort listed no new registrational studies, which are usually the most expensive part of research and development costs.
• Assuming Marathon only gets the negotiated rate of $54,000, the company would only have to treat 200 to 1,400 U.S. patients who have Duchenne (or no more than 8% of the market) in one year "to cover a barebones R&D effort." And don't forget: Marathon has seven years of exclusive monopoly pricing for the drug, and it acquired a valuable "priority review voucher" that can be sold or used to speed along a new drug.