Valeant asked to hand over documents on product pricing
US federal prosecutors have subpoenaed Valeant Pharmaceuticals as part of an investigation of the company's pricing policy and access programmes.
Canadian drugmaker Valeant revealed details of the subpoenas earlier this week and said it intended to cooperate with the investigation, which is being conducted by US Attorney's Offices in Massachusetts and New York.
"Most of the materials requested by the subpoenas relate to documents with respect to our patient assistance programmes," said the company. However, it revealed that the requests also cover financial support programmes for patients, distribution of its products and pricing decisions, as well as "information provided to the Centers for Medicare and Medicaid Services".
The probe comes amid increased scrutiny of the pricing of drugs in the US, which came to a head last month after it was revealed that Turing Pharmaceuticals had raised the price of a critical medicine for a parasitic infection from $13.50 per tablet to $750 immediately after acquiring the drug.
While particular ire was directed at Turing and its chief executive Martin Shkreli over the price gouging, the splash damage from the scandal soon affected other companies accused of excessive price hikes, including Valeant, and there is speculation that it could lead to a larger investigation into pharma's pricing practices.
Valeant's share price has been hit hard by the fallout, forcing the company to send a letter to investors late last month emphasising that the company can grow strongly 'even assuming little to no price increases'.
It also downplayed its exposure to any potential federal clampdown on pricing, saying that a third of its turnover comes from outside the US "where we have historically realised little to no net price increases."
US lawmakers have also put Valeant in the spotlight, with Senator Claire McCaskill sending the company a letter questioning price hikes for two cardiovascular drugs – Nitropress (sodium nitroprusside injection) and Isuprel (isoproterenol) – which were acquired by the company from Marathon Pharma earlier this year.
Media reports suggested that Valeant had introduced a 525 per cent price increase for Isuprel – from $215 to $1,346 per vial – and hiked the price of Nitropress to more than $800 from $257, an increase of more than 200 per cent.
Valeant has sent a response to Sen McCaskill insisting that the price increases have had 'limited impact on the average hospital's costs' and highlighting Valeant's programmes 'designed to improve patient access'.
"All of us at Valeant firmly believe in maintaining strong regulatory and financial controls and believe we have operated our business in a fully compliant manner," said the company's chief executive Michael Pearson.
"We remain committed to assisting eligible patients who need our products, and we will be working with the appropriate groups to submit the requested documents and plan to cooperate with the inquiries."