NEW YORK, Feb 11 (Reuters) - Catalyst Pharmaceuticals Inc said on Monday that it expects its drug for a rare disease, which had long been available to patients for free, will cost more than $300,000 per year including rebates to insurers and other discounts.
The drug, Firdapse, is used to treat Lambert-Eaton Myasthenic Syndrome (LEMS), a rare neuromuscular disorder.
U.S. Senator Bernie Sanders sent a letter to Catalyst last week asking the company to justify its pricing.
For years, patients had been able to get the drug for free from Jacobus Pharmaceuticals, a small New Jersey-based drug company that offered it through the U.S. Food and Drug Administration's "compassionate use" program. The program allows those with rare diseases access to experimental drugs outside of a clinical trial when there is no viable alternative.
Florida-based Catalyst, which in November received U.S. approval to sell the drug, set a list price of $375,000 a year.
In a presentation to investors at a conference in New York on Monday, Catalyst said it expects the net price to be between $300,000 and $318,750 a year, which means it sees rebates and other discounts reducing the cost by 15 percent to 20 percent.
In the United States, drugmakers set a list price for their products, but also typically offer after-market rebates and discounts to encourage insurers and pharmacy benefit managers to pay for the drugs. Last month, the Trump administration proposed a rule to end the industry-wide system of rebates, which has been under increased scrutiny.
The Catalyst drug also received orphan drug status from the FDA, which comes with seven years of marketing exclusivity to encourage development of drugs for rare diseases. The agency grants orphan status to medicines that treat conditions or diseases that affect fewer than 200,000 people in the United States.
Catalyst bought the rights to Firdapse from BioMarin Pharmaceuticals in 2012.
Pharmacy benefit manager Express Scripts, a unit of insurer Cigna Corp, said that Firdapse is a covered medication on its formulary for the small number of patients who meet its coverage criteria.
But an Express Scripts spokeswoman said the pricing "takes advantage of vulnerable patients who need this medication," and called Catalyst an example of a company misusing the Orphan Drug Act.
Catalyst CEO Patrick McEnany declined to comment, except to say that the company would be responding to Senator Sanders' request in a timely manner. (Reporting by Michael Erman and Caroline Humer; editing by Bill Berkrot)