How to describe JP Morgan’s annual healthcare conference? The event, which draws thousands of attendees including pharma CEOs, venture capitalists, institutional investors, and biotech executives, has been likened to healthcare’s “Burning Man.” Or, according to the man behind me in the long, winding registration line, it’s the industry’s “Super Bowl.”
There is an element of spectacle to the proceedings. Case in point: the Sunday before this year’s event kicked off, Bristol-Myers Squibb said it is planning to buy Celgene for $74 billion, a deal that would combine its solid-tumor portfolio with Celgene’s blood cancer treatments.
Before lunch was served on Monday, news of another sizeable deal broke, which brings us to our first theme of day one at the conference:
In the first deal of the conference, Eli Lilly said it is planning to buy Loxo Oncology, a biotech company developing targeted medicines to treat cancers that can be detected via testing for gene mutations, for $8 billion in cash.
Along with the BMS-Celgene news, it was one of the splashier headlines, and immuno-oncology was a central talking point in many of the day’s sessions.
During his early morning joint presentation with Celgene chief executive Mark Alles, BMS CEO Giovanni Caforio was pressed about his confidence in Opdivo, its treatment for people with advanced lung cancer. Despite the drug’s loss of market share across multiple indications to Merck’s Keytruda, Caforio insisted that the company is bullish on the portfolio.
The chief executives of BMS and Regeneron both discussed their high hopes for drugs targeting the BCMA antigen, with Regeneron CEO Leonard Schleifer highlighting the company’s broad portfolio that includes biospecifics that target MUC16, CD3, and LAG3.
Pricing and access
As more innovative, and expensive, treatments are launched, the question is how to pay for them? In a panel on drug pricing hosted by Endpoints, Spark Pharmaceutical CEO Jeff Marrazzo discussed the company’s payment model for Luxturna, its one-time, $850,000 treatment for a rare form of inherited blindness. It includes a efficacy-based rebate program, cutting out treatment centers to work directly with commercial payers, and collaborating with the Centers for Medicare and Medicaid Services to set up an installments-based program. Patients have yet to pay out of pocket for the treatment, he said.
Later Monday morning, Novartis CEO Vasant Narasimhan referenced an ICER report that found its gene therapy for spinal muscular atrophy would be cost-effective if priced between $1.6 million and $5.4 million, depending on the benchmark per quality year of life. “That demonstrates how transformational this medicine is,” he said. However, it also raised the question of how the healthcare system, not to mention individual patients, would be able to afford such treatments.
Conference-based price gouging
Novartis’ CEO also addressed the lack of public trust in pharma. Over the past year, “we, as an industry, have fallen quite far in terms of our reputation,” Narasimhan said, mostly thanks to consistent, and often significant, price hikes.
While Narasimhan pledged to do his best to “regain the trust of society,” few actionable solutions were offered to bring costs to patients down. (To be fair, the audience largely consisted of investors). However, price gouging was a popular topic of conversation among attendees — but the hospitality industry was blamed.
Attending JP Morgan is notoriously expensive — hotel rooms are priced at many times their normal rate as thousands flock into the city — but this year struck many as particularly egregious. “They wanted to charge $900 for a room at the Holiday Inn!” a fellow attendee told me incredulously.
Reports also circulated of hotels charging $21.25 for a cup of coffee, $300 for access to a lobby table, and $30 an hour for the privilege of standing in the lobby. It was enough to make people prickly, although the irony of the situation didn’t go unnoticed.
For highlights from day two, click here.
For highlights from day three, click here.