Lawmakers express concern that pricing practices may have violated antitrust laws
WASHINGTON – U.S. Senator Amy Klobuchar (D-MN), Chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights, and Representative Katie Porter (D-CA), member of the House Oversight Committee, urged the Department of Justice (DOJ) and Federal Trade Commission (FTC) to examine the parallel price increases for two commonly-used blood thinner medications: Janssen Pharmaceuticals’ Xarelto and Bristol-Myers Squibb (BMS)-Pfizer’s Eliquis. The lawmakers expressed concern that lockstep pricing practices and the general lack of competitive behavior exhibited by these drug sellers may constitute potential unlawful conduct.
“We are principally concerned that the prices for these products, which are close substitutes for each other, have been raised in lockstep in a manner that seems coordinated to maintain pricing parity,” the lawmakers wrote to DOJ Assistant Attorney General for the Antitrust Division Jonathan Kanter and FTC Chair Lina Khan.
“Xarelto and Eliquis are anticoagulants, also known as blood thinners, that help prevent and treat blood clots and prevent stroke in high-risk patients…These drugs have become too expensive for many patients to purchase, forcing them to switch to less effective medications that may pose health risks,” the lawmakers continued. “We urge your agencies to evaluate the state of competition in this drug market and whether these companies’ pricing practices may have violated federal antitrust laws.”
As Chair of the Senate Judiciary Subcommittee on Competition Policy, Antitrust, and Consumer Rights, Klobuchar has long led efforts to combat anticompetitive conduct in the pharmaceutical industry. Last week, she joined a bipartisan group of colleagues in calling on the U.S. Patent and Trademark Office (PTO) to address the “patent thicket” that pharmaceutical companies use to reduce competition and inflate drug prices.
Last July, Klobuchar chaired a subcommittee hearing on the need to increase competition in the prescription drug market to lower costs for patients and the health care system.
In April 2021, Klobuchar introduced two pieces of bipartisan legislation with Senator Chuck Grassley (R-IA) to promote competition and reduce drug costs: the Preserving Access to Affordable Generics and Biosimilars Act and the Stop Stalling Act. The same month, Klobuchar testified before the House Judiciary Committee to call for increased competition in health care markets.
In September 2019, Klobuchar led eight colleagues in calling on the FTC to closely scrutinize pharmaceutical industry mergers, warning that such consolidation may threaten competition, increase prices, and reduce patient access to critical medications.
In November 2018, Klobuchar and Grassley urged the Trump administration to support legislation that limits anti-competitive “pay-for-delay” pharmaceutical settlements as part of the administration’s effort to bring down the skyrocketing price of prescription drugs.
Congresswoman Porter has not shied away from calling out Big Pharma on behalf of patients. On three different occasions, she confronted pharmaceutical CEOs directly for price gouging patients to line the pockets of executives and shareholders. Last year, she released a comprehensive report outlining how Big Pharma’s anticompetitive behavior stifles scientific innovation and hurts patients. She has spearheaded legislation that would crack down on drug manufacturers profiting off unreasonable price hikes, which passed the House of Representatives as part of the Elijah E. Cummings Lower Drug Costs Now Act.
The full text of the letter is available HERE and below:
Dear Assistant Attorney General Kanter and Chair Khan:
We write to raise concerns regarding Janssen Pharmaceuticals’s and Bristol-Myers Squibb (BMS) / Pfizer’s parallel price increases for Xarelto and Eliquis. Xarelto and Eliquis are blockbuster anticoagulant drugs that millions of Americans depend on to help prevent heart attacks, strokes, and blood clots. The prices for these two competing products have risen every year since they entered the market at a rate far outpacing inflation, without any meaningful improvements to the medications or any apparent increase in production costs. We are principally concerned that the prices for these products, which are close substitutes for each other, have been raised in lockstep in a manner that seems coordinated to maintain pricing parity. We write to urge the Department of Justice (DOJ) and the Federal Trade Commission (FTC) to look into whether Janssen Pharmaceuticals and BMS / Pfizer’s pricing practices for Xarelto and Eliquis, respectively, may have violated the antitrust laws.
Xarelto and Eliquis are anticoagulants, also known as blood thinners, that help prevent and treat blood clots and prevent stroke in high-risk patients. Close to 4 million Medicare Part D beneficiaries take Eliquis and Xarelto, including patients with nonvalvular atrial fibrillation and those being treated for deep vein thrombosis or pulmonary embolism. Unlike many privately insured individuals who only pay set co-pays, Part D beneficiaries must pay an out-of-pocket percentage of the medication list price. When pharmaceutical companies increase the list price of their drugs, older adults and other Medicare beneficiaries often must pay more at the point of sale, preventing many from obtaining the prescribed drug. The number of Medicare beneficiaries filling anticoagulant prescriptions has more than doubled in the past decade, leaving taxpayers and older or disabled Americans vulnerable to exploitation by corporations coordinating or colluding to raise prices rather than competing to lower them.
In 2021, Eliquis was the most costly drug and Xarelto the third most costly drug for all of Medicare, costing beneficiaries and taxpayers well over $8 billion. In terms of total U.S. sales, Janssen raised $16.7 billion in revenue from Eliquis and BMS/Pfizer made $8 billion from Xarelto. These drugs were among the top seven products with direct-to-consumer advertising spending, with their parent companies spending a combined total of more than $300 million last year. There is little reason to expect the prices for these products to decline in the near future as Janssen will not have a generic competitor until 2025 at the earliest, and BMS/Pfizer has fended off any generic competition for Eliquis through 2026.
These drugs have become too expensive for many patients to purchase, forcing them to switch to less effective medications that may pose health risks. An older blood thinner, called warfarin, is inexpensive, but carries a high risk of bleeding and requires frequent lab tests to monitor that bleeding risk. Eliquis and Xarelto were both introduced about a decade ago, priced at just over $200 for a month’s supply. After more than a decade of price increases in seemingly coordinated fashion, a month’s supply is priced at $529 for Eliquis and $516 for Xarelto, five times and ten times the prices paid in other countries, respectively.
This pattern of lockstep price increases and the general lack of competitive behavior exhibited by these drug sellers raises concerns regarding potential unlawful conduct. We urge your agencies to evaluate the state of competition in this drug market and whether these companies’ pricing practices may have violated federal antitrust laws.