Colombia to set new price for Novartis cancer drug: minister

[June 10, 2016]  By Julia Symmes Cobb and Luis Jaime Acosta

BOGOTA (Reuters) - Colombia will set a new price for the Novartis cancer drug imatinib in a bid to cut healthcare costs after price negotiations with the Swiss company broke down, the health minister said on Thursday.

A so-called public interest declaration for imatinib will allow health regulators to examine the case and set a new, lower price for the drug. Colombia stopped short of declaring a compulsory license, which would have overridden Novartis' patent and permitted other companies to make cheaper generic versions.

Novartis will be legally obliged to sell the drug, used to treat leukemia and other cancers, at the new price.

"The negotiations have definitively broken down," Health Minister Alejandro Gaviria told reporters at a conference in Cartagena, adding the formal declaration will come within days. "What that entails is declaring public interest with the principal objective of unilaterally fixing a price."

Colombia, looking to curb costs for its beleaguered healthcare system, had asked Novartis to decrease the price of imatinib. But the company had proved "reticent," Gaviria told Reuters last month.

The drug, sold under brand names Glivec or Gleevec, was not under patent in Colombia between 2003 and 2012, sparking competition from generic producers whose prices are 197 percent cheaper than those of Novartis, according to the health ministry. The current patent is valid until mid-2018.

Each 400 milligram tablet of imatinib currently costs 129,000 Colombian pesos, around $44. The government had proposed to Novartis that the price be lowered to the equivalent of $18.50. Imatinib is used by some 2,500 patients in Colombia.

The new price will likely be near the average price the drug cost before the Novartis patent came into force, a health ministry spokesman told Reuters, and is expected to be announced in the coming days.

"We have remained fully committed to finding a resolution that benefits patients, innovators and the Colombian healthcare system," Novartis said in a statement, adding it had not yet received official confirmation from Colombia about the end of talks.

Declarations of public interest can be legitimate, the company added, but one was not required in this case. "There are already non-infringing generic versions of imatinib on the market, which the government could purchase instead of Glivec in order to reduce its costs."

Thailand, India and Brazil have come under fire from pharmaceutical companies and the U.S. government for using compulsory licenses, which critics say violate patents.

(Reporting by Julia Symmes Cobb and Luis Jaime Acosta; Editing by Dan Grebler)

[© 2016 Thomson Reuters. All rights reserved.]

Copyright 2016 Reuters. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.