December 25, 2017

A Statement Regarding Media Coverage of Gleostine® (lomustine)

by admin in Position Statements 0 comments

Recently, NextSource Pharma’s pricing of Gleostine® (lomustine) was questioned by national media for a series of price increases over the past three years. The subject of drug pricing is an important one. It is more complex than many realize.

In general, pricing is determined based on a number of factors including product development costs, regulatory agency fees, class of product, benefit the treatment delivers to patients, and other determinants. A recent report places the cost to develop and launch a single drug at just shy of $3 billion1.

Specifically for Gleostine®, our price reflects:

  •  The Cost of raw materials, including a key manufacturing component, which has increased substantially.
  • Supplying the product at little to no cost to the Federal Government for use in Medicaid and the government drug discount program (PHS 340B) for as little as five cents per bottle of five capsules. This represents millions of dollars of cost to the company annually.
  • FDA and health authority annual licensing fees that have quadrupled over the past three years. Read more about it here.
  • We provide Gleostine® at a significantly reduced cost to uninsured patients and patients who lack the resources to pay for the product, again representing a substantial cost to the company.
  • We maintain an inventory of 12 months’ safety stock in the US market at a substantial cost to ensure adequate product distribution and availability. We are committed to assuring that the drug is always available.

Finally, it is important to note that there are currently less than five FDA-approved glioblastoma brain tumor drugs like Gleostine® available on the market today. Among this class of drug products, Gleostine® is priced within the mid-to low-end range compared to the other treatments.

1 Joseph A. DiMasi, Henry G. Grabowski, Ronald W. Hansen (2016). “Innovation in the pharmaceutical industry: New estimates of R&D costs”. Journal of Health Economics. 47: 20–33. doi:10.1016/j.jhealeco.2016.01.012.