TORONTO (Reuters) – Italy’s Recordati said on Tuesday it plans to seek Canadian approval for its drug Cystagon, which treats a rare kidney disease, in a potential blow to Horizon Pharma,, which makes the only drug approved for treatment in Canada.
Cystagon and Horizon’s drug Procysbi use the same active ingredient to treat nephropathic cystinosis, a genetic disorder that can cause fatal kidney damage. Only about 100 people in Canada have the disease, but at list prices Procysbi costs C$325,000 ($243,336.33) per year, according to Canadian regulators.
Cystagon, which is manufactured by Mylan Pharmaceuticals and sold in Canada and Europe by Recordati, has been available in Canada for more than two decades under a special program that lets patients use drugs not approved in the country as long as there is no alternative available.
In 2017, Horizon won Health Canada’s approval for Procysbi, making it much harder for Canadian patients to access Cystagon.
Canadian approval for Cystagon, which Recordati said costs about C$25,000 a year, would make the cheaper drug accessible again. About 13 percent of Horizon’s 2018 net sales were from the sale of Procysbi in the United States and Canada.
“Recordati is planning to apply for Health Canada approval of Cystagon,” Recordati said in an emailed statement. “This process is being followed to avoid patients on Canada’s Special Access Program having to change their treatment to an alternative much more expensive similar drug.”
Recordati said it plans to apply for the approval sometime this year. It said the approval process would likely take about a year.
PRICING DISPUTE
In January, Canada’s federal drug price regulator, the Patented Medicine Prices Review Board (PMPRB), sought an order that would force Horizon to reduce the price of Procysbi and repay as much as C$3.2 million to public drug plans. Horizon is opposing the order. The case could end up in federal court and take years to resolve.
“The Health Canada review and approval of Cystagon would be good news for people living with cystinosis – we believe it’s always good for patients with rare diseases and their families to have more choices,” Horizon said in an emailed statement.
The company has argued that Procysbi is a superior drug because it is taken every 12 hours, instead of every six, helping patients stick with the treatment and live longer.
Horizon says it spent $180 million developing Procysbi, and that it is providing free medication to patients who do not have insurance coverage, as well as undisclosed discounts to public drug plans.
Last year, Horizon recorded a $37.9 million impairment related to Procysbi, citing the possibility of lower future sales because of the PMPRB case.
Prescription drugs are often sold for less than their list prices, but discounts are generally secret. In Canada, the private, employer-funded drug plans that cover the majority of patients are more likely to pay list prices for new drugs than public programs.
Reporting by Allison Martell; Editing by Denny Thomas and Paul Simao