Already backpedaling amid concerns about the safety of its anemia drug Aranesp, Amgen has announced it will curtail certain pricing practices that may have fostered overutilization of the drug.
Until the change, Amgen gave rebates to oncology practices that were heavy users of Aranesp, and gave Aranesp-prescribing doctors discounts toward the purchase of related drugs in Amgen’s quiver.
Pricing policies like this and the perverse prescribing incentives they create are common in the industry. Still, something had to give when Aranesp and similar drugs were found to accelerate progression of some cancers, cause cardiovascular problems, and shorten survival.
Although Amgen stock is up 35% for the year, things can’t be honky-dory in Thousand Oaks these days. Congress is investgating Amgen for its pricing practices and Medicare has cut reimbursement for Aranesp. To make matters worse, a batallion of blogospherists has seized on the news, turning the Amgen brand into a full blown populist cause.
Amgen management is running a gauntlet between its need to increase shareholder value and its need to do right by those who use its products. Everyone wants them to succeed, it’s just not everyone agrees on what constitutes success.