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The new drug looked so promising except for that one warning sign.

This story also ran on Fortune. It can be republished for free.

At the American College of Rheumatologys annual meeting in 2008, Duke Universitys Dr. John Sundy proudly announced that pegloticase, a drug hed helped develop, was astoundingly effective at treating severe gout, which affects perhaps 50,000 Americans. In about half of those who had taken it, the drug melted away the crystalline uric acid deposits that encrusted their joints to cause years of pain, immobility, or disfigurement.

But Sundy also disclosed an unsettling detail: In one clinical trial, patients who got the drug were more likely to develop heart problems than those who didnt. The day after Sundys talk, the stock price of Savient Pharmaceuticals, which developed the drug with Duke scientists, plunged 75%.

That danger signal would disappear in later studies, and the FDA approved pegloticase, under the trade name Krystexxa, two years later. But the small biotech company never recovered. In 2013, Savient was sold at auction to Crealta, a private equity venture created for the purpose, for $120 million.

Two years later, a young company now called Horizon Therapeutics bought Crealta and its drug portfolio for $510 million.

Even at that price, it proved a good deal. Krystexxa brought in $716 million in 2022 and was expected to earn $1 billion annually in coming years.

Although Horizon says it now has 20 drugs under development, in its 15 years of existence it has yet to license a product it invented. Yet the company has managed to assemble a war chest of lucrative drugs, in the process writing a playbook for how to build a modern pharmaceutical colossus.

As the White House and both parties in Congress grapple with reining in prescription drug prices, Horizons approach reveals just how difficult this may be.

Horizons strategy has paid off handsomely. Krystexxa was just one of the many shiny objects that attracted Amgen, a pharmaceutical giant. Amgen announced in December that it intends to buy Horizon for $27.8 billion, in the biggest pharmaceutical industry deal announced in 2022.

Horizons CEO, Tim Walbert, who will reportedly get around $135 million when the deal closes, has mastered a particular kind of industry expertise: taking drugs invented and tested by other people, wrapping them expertly in hard-nosed marketing and warm-hued patient relations, raising their prices, and enjoying astounding revenues.

Hes done this with unusual finesse courting patients with concierge-like attention and engaging specialist clinicians with lunches, conferences, and research projects, all while touting his own experience as a patient with a rare inflammatory disease. Walberts company has been particularly adept at ensuring that insurers, rather than patients, bear the costly burdens of his drugs.

A federal prosecutor in 2015 began examining allegations that Horizons patient assistance program had worked with specialty pharmacies to evade insurers efforts to shun Horizons expensive drugs. A separate probe opened in 2019 over alleged kickbacks to pharmacy benefit managers, companies that negotiate to get Horizons drugs covered by insurers. Those investigations appear to be no longer active, Horizon spokesperson Catherine Riedel said. The company this year disclosed a third probe, concerning methods the company allegedly used to get prior authorization of its drugs. Justice officials did not respond to requests for comment on the investigations. Email Sign-Up

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An Injection of Marketing

To help sell its drugs, Horizon blankets specialist physicians with marketing and peer-to-peer appeals. Its payments to physicians for things like consulting, speeches, and meals totaled $8.7 million in 2021, compared with the $10 million it paid them for research, federal records show. By contrast, Seagen, a biotech company of roughly the same size, paid doctors a total of $116 million, with nearly $112 million of that pegged for research. Riedel said Horizons marketing and educational approaches were necessarily unique because of the challenges of treating rare and neglected diseases.

Walbert launched Horizon in 2008 in the Chicago area by combining and refashioning generic drugs into single pills. Duexis, Horizons first drug, is a mixture of generic Motrin and Pepcid. Its Vimovo combines generic Aleve and Nexium. In a 2017 article, a ProPublica reporter described being prescribed Vimovo for a shoulder injury. It cost him nothing, but his insurer was billed $3,252 for pills that together cost about $40 for a months supply in generic form. Horizon sold more than $57 million worth of Vimovo that year.

In 2014 and 2015, respectively, Horizon picked up two relatively new drugs that had no generic versions: the immunosuppressant Actimmune and Ravicti, which treats a rare genetic disorder. Soon Horizon was charging more than $50,000 a month for each, placing Actimmmune fourth and Ravicti second on GoodRxs 2020 list of the most expensive U.S. drugs.

Horizons net sales soared from $20 million in 2012 to $981 million in 2016; Walberts pay package followed suit, topping an astronomical $93.4 million in 2015 in salary and stock. Stock analysts questioned the long-term soundness of a strategy of simply selling old drugs for mind-boggling prices, but Walbert was using the cash to refashion the company as a rare-diseases franchise.

His approach would make Walbert a darling of pharmaceutical investors and his board, which lavished him with over $20 million in compensation each of the past three years. While most biotechs and startups borrow heavily from venture capital to do science and have no idea how to develop and market a drug, Walbert got cash coming in quickly. He did it backwards, said Annabel Samimy, an analyst at Stifel Financial Corp. Horizon built commercial platforms before they got into drug development.

Generating robust sales of what sounded like not very interesting drugs allowed Walbert to start a company on not very much, said Oppenheimer analyst Leland Gershell. All the while, Horizon funded and cultivated the patient advocacy groups that can help lobby for a drug to be approved by the FDA and placed on insurers formularies, the lists of drugs health plans cover for patients.

Capitalizing on His Own Illness?

As Walbert and his spokespeople often point out, Walbert and his youngest son suffer from a rare disease, and Walbert also has an autoimmune disease. Walbert wont name the diseases, but has said hes taken the anti-inflammatory injectable Humira since 2003 the year he led that drugs commercial launch as a vice president at Abbott Laboratories. Humira has become the bestselling drug in history, with about $200 billion in all-time global sales.

In 2014, Walbert moved Horizons headquarters to Ireland, which nearly halved its tax rate. A year later it gained control of Krystexxa, and in 2017 it bought, for $145 million, a failing company that produced Tepezza, a drug for thyroid eye disease, which causes unsightly eye bulging and pain.

Tepezza quickly became a blockbuster, with $3.6 billion in total sales in 2021 and 2022. The company conducted additional clinical research on both Tepezza and Krystexxa, but it also spent heavily promoting these and other drugs to specialists who could prescribe them.

All the while it steadily raised prices. Savient put Krystexxa on the market in 2011 at $2,300 per injection. Horizon charges roughly 10 times as much. Six months of Tepezza treatment can run more than $400,000.

Horizons publicity emphasized the companys sensitivity to patients, and its constant contact with disease advocates.

Our scientists are attuned to the unmet needs of patients, their diagnostic and therapeutic journey, Bill Rees, Horizons vice president for translational sciences, told KFF Health News. Its the marrying of the basic clinical science with a focus on the needs of the patient that differetiates us.

To make sure patients keep using its drugs, clinicians say, Horizon staffers negotiate with insurance carriers, and the company offers drug discounts to lower-income patients while swaddling them with attention from its medical staff.

Horizon has a nurse talk to each and every patient before every appointment, said Dr. Brigid Freyne, who treats around half a dozen patients each year with Krystexxa at her Murrieta, California, rheumatology clinic. The patients who come in here are highly motivated to get their IV. They get the message that its very important and they are fortunate to get the medicine.

None of the manufacturers of her other infusion drugs shower patients with this kind of attention, she said.

While at Abbott, Walbert pioneered direct-to-consumer advertising for specialty drugs like Humira, a trend that aggravated insurers, who anticipated, correctly, that they would soon be shelling out billions for expensive drugs.

Horizons marketing plan for Krystexxa includes direct-to-consumer ads aimed at driving patients to specialists. The drug is designed for recalcitrant gout patients, who often have large lumps on their fingers, feet, and kidneys. Many, though not all, are heavy drinkers of beer or soda sweetened with high-fructose corn syrup, which can increase the buildup of uric acid, the cause of gout, said Dr. Robert McLean of Yale University.

While Krystexxa can help patients with advanced gout, the American College of Rheumatology views it as a drug of last resort, with plenty of cheaper, early intervention alternatives available.

I prescribe it maybe once a year, McLean said. From a cost-effectiveness standpoint, it warrants questioning.

Horizon recently started a publicity campaign addressed to all gout sufferers, urging them to see a rheumatologist or a nephrologist the specialists it has targeted with Krystexxa educational materials before the disease does too much harm.

Horizon would like you to say, Everyone with serious gout should be started on Krystexxa, said Dr. James ODell, a rheumatologist at the University of Nebraska Medical Center. The Horizon pitchmen he deals with are nice guys, but we dont believe thats the best way.

The company defends its marketing practices. We learn what matters most to patient communities and act. This approach has been validated by independent third-party research, said Riedel.

The Federal Trade Commission said in January it was seeking more information on the Amgen-Horizon merger. Sen. Elizabeth Warren (D-Mass.), citing high prices for Horizon and Amgen drugs, urged the agency to nix the deal.

Arthur Allen: ArthurA@kff.org, @ArthurAllen202 Related Topics Health Care Costs Health Industry Pharmaceuticals Drug Costs Prescription Drugs Contact Us Submit a Story Tip

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Nats seek ‘fresh approach,’ fire Martinez, Rizzo

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Nats seek 'fresh approach,' fire Martinez, Rizzo

The last-place Washington Nationals fired president of baseball operations Mike Rizzo and manager Davey Martinez, the team announced Sunday.

Rizzo, 64, and Martinez, 60, won a World Series with the Nationals in 2019, but the team has floundered in recent years. This season, the Nationals are 37-53 and stuck at the bottom of the National League East after getting swept by the Boston Red Sox this weekend at home. Washington hasn’t finished higher than fourth in the division since winning the World Series.

“On behalf of our family and the Washington Nationals organization, I first and foremost want to thank Mike and Davey for their contributions to our franchise and our city,” principal owner Mark Lerner said in a statement. “Our family is eternally grateful for their years of dedication to the organization, including their roles in bringing a World Series trophy to Washington, D.C.

“While we are appreciative of their past successes, the on-field performance has not been where we or our fans expect it to be. This is a pivotal time for our club, and we believe a fresh approach and new energy is the best course of action for our team moving forward.”

Mike DeBartolo, the club’s senior vice president and assistant general manager, was named interim GM on Sunday night. DeBartolo will oversee all aspects of baseball operations, including the MLB draft. An announcement will be made on the interim manager Monday, a day before the club begins a series against the St. Louis Cardinals.

Rizzo has been the top decision-maker in Washington since 2013, and Martinez has been on board since 2018. Under Rizzo’s leadership, the team made the postseason four times: in 2014, 2016, 2017 and 2019. The latter season was Martinez’s lone playoff appearance.

“When our family assumed control of the team, nearly 20 years ago, Mike was the first hire we made,” Lerner said. “Over two decades, he was with us as we went from a fledging team in a new city to World Series champion. Mike helped make us who we are as an organization, and we’re so thankful to him for his hard work and dedication — not just on the field and in the front office, but in the community as well.”

The Nationals are in the midst of a rebuild that has moved slower than expected, though the team didn’t augment its young core much during the winter. Led by All-Stars James Wood and MacKenzie Gore, Washington has the second-youngest group of hitters in MLB and the sixth-youngest pitching staff.

The team lost 11 straight games in a forgettable stretch last month. And during a 2-10 run in June, Washington averaged just 2.5 runs. Since June 1, the Nationals have scored one run or been shut out seven times. In Sunday’s 6-4 loss to Boston, they left 15 runners on base.

There was industry speculation over the winter that the Nationals would spend money on free agents for the first time in several years, but that never materialized. Instead, the team made minor moves, signing free agents Josh Bell and Michael Soroka, trading for first baseman Nathaniel Lowe and re-signing closer Kyle Finnegan. Now, the hope is a new management team, both on and off the field, can help change the franchise’s fortunes.

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Kershaw gets special ASG invite; no Soto, Betts

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Kershaw gets special ASG invite; no Soto, Betts

The rosters for the 2025 MLB All-Star Game will feature 19 first-timers — and one legend — as the pitchers and reserves were announced Sunday for the July 15 contest at Truist Park in Atlanta.

Los Angeles Dodgers left-hander Clayton Kershaw, a three-time Cy Young Award winner who made his first All-Star team in 2011, was named to his 11th National League roster as a special commissioner’s selection.

Kershaw, who became only the fourth left-hander to amass 3,000 career strikeouts, is 4-0 with a 3.43 ERA in nine starts after beginning the season on the injured list. He joins Albert Pujols and Miguel Cabrera as a legend choice, after the pair of sluggers were selected in 2022.

Kershaw said he didn’t want to discuss the selection Sunday.

Among the first-time All-Stars announced Sunday: Dodgers teammate Yoshinobu Yamamoto; Washington Nationals outfielder James Wood and left-hander MacKenzie Gore; Houston Astros ace Hunter Brown and shortstop Jeremy Pena; and Chicago Cubs 34-year-old left-hander Matthew Boyd.

“It’ll just be cool being around some of the best players in the game,” Wood said.

First-time All-Stars previously elected to start by the fans include Seattle Mariners catcher Cal Raleigh, Athletics shortstop Jacob Wilson, Baltimore Orioles designated hitter Ryan O’Hearn and Cubs center fielder Pete Crow-Armstrong.

Overall, the 19 first-time All-Stars is a drop from the 32 first-time selections on the initial rosters in 2024.

Kershaw would be the sentimental choice to start for the National League, although Pittsburgh Pirates ace Paul Skenes, who leads NL pitchers in ERA and WAR, might be in line to start his second straight contest. Philadelphia Phillies right-hander Zack Wheeler, a three-time All-Star, is 9-3 with a 2.17 ERA after Sunday’s complete-game victory and also would be a strong candidate to start.

“I think it would be stupid to say no to that. It’s a pretty cool opportunity,” Skenes said about the possibility of being asked to start by Dodgers manager Dave Roberts. “I didn’t make plans over the All-Star break or anything. So, yeah, I’m super stoked.”

Kershaw has made one All-Star start in his career, in 2022 at Dodger Stadium.

Among standout players not selected were New York Mets outfielder Juan Soto, who signed a $765 million contract as a free agent in the offseason, and Dodgers shortstop Mookie Betts, who had made eight consecutive All-Star rosters since 2016.

Soto got off to a slow start but was the National League Player of the Month in June and entered Sunday ranked sixth in the NL in WAR among position players while ranking second in OBP, eighth in OPS and third in runs scored.

The players vote for the reserves at each position and selected Wood, Corbin Carroll of the Arizona Diamondbacks and Fernando Tatis Jr. of the San Diego Padres as the backup outfielders. Kyle Stowers also made it as a backup outfielder as the representative for the Miami Marlins.

Unless Soto later is added as an injury replacement, he’ll miss his first All-Star Game since his first full season in 2019.

The Dodgers lead all teams with five representatives: Kershaw, Yamamoto and starters Shohei Ohtani, Freddie Freeman and Will Smith. The AL-leading Detroit Tigers (57-34) and Mariners have four each.

Tigers ace Tarik Skubal will join AL starters Riley Greene, Gleyber Torres and Javier Baez, while Raleigh, the AL’s starting catcher, will be joined by Seattle teammates Bryan Woo, Andres Munoz and Julio Rodriguez.

Earning his fifth career selection but first since 2021 is Texas Rangers righty Jacob deGrom, who is finally healthy after making only nine starts in his first two seasons with the Rangers and is 9-2 with a 2.13 ERA. He has never started an All-Star Game, although Skubal or Brown would be the favorite to start for the AL.

The hometown Braves will have three All-Stars in Acuna, pitcher Chris Sale (his ninth selection, tied with Freeman for the second most behind Kershaw) and first baseman Matt Olson. The San Francisco Giants had three pitchers selected: Logan Webb, Robbie Ray and reliever Randy Rodriguez.

The slumping New York Yankees ended up with three All-Stars: Aaron Judge, Jazz Chisholm Jr. and Max Fried. The Mets also earned three All-Star selections: Francisco Lindor, Pete Alonso and Edwin Diaz.

“Red carpet, that’s my thing,” Chisholm said. “I do have a ‘fit in mind.”

Rosters are expanded from 26 to 32 for the All-Star Game. They include starters elected by fans, 17 players (five starting pitchers, three relievers and a backup for each position) chosen in a player vote and six players (four pitchers and two position players) selected by league officials. Every club must be represented.

Acuna, Wood and Raleigh are the three All-Stars who have so far committed to participating in the Home Run Derby.

The Associated Press contributed to this report.

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Bellinger rescues Yankees to avoid Subway sweep

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Bellinger rescues Yankees to avoid Subway sweep

NEW YORK — The New York Yankees were seemingly in deep trouble Sunday when Juan Soto cracked a pitch to left field in the seventh inning.

The New York Mets, down two runs, were cooking up a rally with no outs. Francisco Lindor stood at first base, Pete Alonso loomed on deck, and Brandon Nimmo was in the hole. This was the heart of the Mets’ potent lineup. Given the Yankees’ recent woes, fumbling their two-run lead and suffering a Subway Series sweep at the hands of their neighbors — and a seventh straight loss — seemed almost fated.

Then Cody Bellinger charged Soto’s sinking 105 mph line drive, made a shoestring catch and fired a strike to first base for an improbable double play to secure a skid-snapping 6-4 win — and perhaps rescue the Yankees from another dreadful outcome.

“Considering the context of this week and everything,” Yankees manager Aaron Boone said, “that’s probably our play of the year so far.”

Soto’s line drive off Mark Leiter Jr. had a 10% catch probability, according to Statcast, but Bellinger, a plus defender at multiple positions who started at first base Saturday, was just able to snatch it before it touched the grass. Certain that he caught it clean, he made an 89.9 mph toss that reached first baseman Paul Goldschmidt on a line, over Lindor, who didn’t slide into the bag.

“I saw it in the air and had a really good beat on it,” said Bellinger, who went 2-for-3 with a double and a walk at the plate.

The Mets challenged the catch, but the call stood.

“That was incredible,” said Yankees right fielder Aaron Judge, who swatted his 33rd home run of the season in the fifth inning. “I’ve never seen something like that on the field.”

For the past week, a stretch Boone described as “terrible” for his ballclub, poor defense has been an issue for the Yankees. Physical errors. Mental lapses. Near disasters. The sloppiness helped sink a depleted pitching staff, more than offsetting the offense’s strong production.

That combination produced the team’s second six-game losing streak in three weeks and a three-game deficit in the American League East standings behind the first-place Toronto Blue Jays.

The surging Blue Jays won again Sunday to extend their winning streak to seven games and keep their division lead at three games, but Bellinger’s glove and arm ensured it didn’t grow to four.

“That was an unbelievable play,” Goldschmidt said. “Amazing catch and absolute cannon to me at first. To make that play was a game-changing play and potentially game-winning play for us today. And we needed it.”

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