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News & Trends - Pharmaceuticals

Lilly abandons launch of first-in-class therapy amidst pricing deadlock with PBAC

Health Industry Hub | February 1, 2024 |

Pharma News: Eli Lilly Australia has encountered unexpected hurdles in securing PBS listing for Omvoh (mirikizumab), the first-in-class IL-23 inhibitor to enter the crowded ulcerative colitis market for moderate to severe active disease. The company will withdraw the novel medicine from the local market.

Despite a positive recommendation from the Pharmaceutical Benefits Advisory Committee (PBAC) in July 2023, Lilly has found itself unable to navigate the PBS listing process for Omvoh amidst the challenges posed by existing pricing policies. Current regulations mandate Lilly to accept a price equivalent to the “lowest cost comparator,” which, in this case, is a biosimilar of a decades-old therapy for ulcerative colitis.

Tori Bown, General Manager for Eli Lilly Australia, expressed her concern, stating, “This is not a decision we have taken lightly. It will impact many patients and clinicians. It is extremely disappointing that after investing in Australia as a location for Omvoh clinical trials, we cannot make the medicine available through the PBS to benefit patients.”

The HTA Review Consultation 2 Options Paper acknowledges the pressing need for reform in health technology assessment (HTA) practices. One key concern highlighted is the undervaluation of novel health technologies, a sentiment echoed by the pharmaceutical industry, which argues that the full value of such innovations is not being recognised.

The Options Paper proposes clarifying the selection of comparators relevant for submissions claiming superiority as opposed to non-inferiority. In addition, it suggests developing models to assess the impact of HTA Review recommendations, considering different scenarios with varying discount rates for technologies like vaccines and gene therapies. Consulting stakeholders on accepting higher prices for therapies in specific circumstances is also being proposed.

Ms Bown noted the challenges faced during negotiations, stating, “The goal posts continued to shift in terms of a launch price for Omvoh. It was clear that there was significant risk of further price erosion over time due to PBS reference pricing.”

Lilly emphasised that, without significant policy change recognising the full value of innovative medicines, it is no longer feasible to make Omvoh available through the PBS.

Ms Bown highlighted the broader issue, stating, “As Omvoh illustrates, some aspects of HTA and pricing policy in Australia de-value innovative medicine and ultimately impede patient access.”

Calling for urgent policy change, Lilly hopes that bold and meaningful HTA reform will pave the way for the accessibility of novel medicines like Omvoh to Australian patients in the future.

Lilly’s submission to the HTA Review Consultation 2 will leverage the experience with Omvoh to advocate for substantial policy change. The company encouraged clinicians and patient advocacy groups to actively participate in consultation 2 to shed light on the negative impact of current policies on Australian patients.

Regrettably, Lilly confirmed that, under the current circumstances, making Omvoh available in Australia on a private prescription for ulcerative colitis is unfeasible. The company remains committed to pushing for reform that ensures the timely availability of innovative medicines to those in need.

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