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Billionaire Bill Gates, whose foundation seeks to spread modern medicine through the developing world and wipe out diseases of the poor such as malaria, said he supports the U.S. drug pricing system even as politicians have intensified their criticism of high costs. “The current system is better than most other systems one can imagine,” Gates said in an interview on Bloomberg Television. “The drug companies are turning out miracles, and we need their R&D budgets to stay strong. They need to see the opportunity.” (Chen and Schatzker, 6/30)

A federal appeals court ruled on Tuesday that biosimilar makers must always notify their brand-name rivals six months before launching expensive biologic medicines. The decision may have a significant impact on near-term health care costs, because it will effectively delay competition for these pricey drugs. (Silverman, 7/5)

Drug coupons are a clever marketing tactic increasingly used by pharmaceutical companies for a counterintuitive purpose: to keep drug prices high. By forgoing or reducing patients’ payments for pricier brand-name drugs, they ensure more sales for which insurers foot the bulk of the bill. (The companies get nothing if people choose generics or don’t fill prescriptions at all.) The coupons also stymie insurers’ attempts to encourage consumers to factor price into their health-care decisions. And by making the true cost of a drug essentially unknowable, they are yet another example of how medical pricing remains opaque, despite the promise of the Affordable Care Act. (Ornstein, 6/30)

As part of a strategy to switch patients to newer HIV treatments, Gilead Sciences late last week raised prices on a pair of older HIV medications that face patent expiration. This sort of maneuver is often found in the pharmaceutical playbook, but is triggering still more criticism by AIDS activists of its overall pricing strategies. Here’s what Gilead did: the company raised the wholesale acquisition cost, or list price, for the two older medicines — Complera and Stribild — by 7 percent, to $2,508 and $3,469 a month, respectively. This follows price hikes of 7 percent and 5 percent last January, which Cowen analyst Phil Nadeau noted is a deviation from the typical annual price hikes that Gilead takes on its HIV drugs. (Silverman, 7/5)

Rising drug prices are creating anxiety for patients, politicians and physicians across the country, with little relief in sight. Last year the average price of an established brand-name drug jumped more than 16 percent, according to prescription benefit manager, Express Scripts Holding Co. Since 2011, prices have nearly doubled. Darius Lakdawalla, a health economist at the University of Southern California, says it's time to move to a more flexible, performance-based approach to drug pricing. His answers have been edited for length and clarity. (7/4)

Continued increases in prescription drug costs are "the number one driving factor” for increasing health insurance premiums, according to testimony from Wyoming Insurance Commissioner Tom Glause, who was appointed by Gov. Matt Mead (R), at a subcommittee hearing on small business health care costs held by the Senate Committee on Health, Education, Labor and Pensions. “Health care determines the cost of health insurance. Health insurance doesn’t dictate the cost of health care,” Glause said. (Hansard, 6/30)

As U.S. politicians including presidential candidates Hillary Clinton and Donald Trump shower criticism on the pharmaceutical industry, drugmakers need to change their tune, Regeneron Pharmaceuticals Inc. Chief Executive Officer Len Schleifer said. "We are going to have to do a better job at explaining the value proposition of products we bring out,” Schleifer said at a Bloomberg pharma event in New York. “We need to be reasonable about the way we price these things.” (Bloomfield and Micklethwait, 6/29)

Ken Frazier, Merck’s chairman and CEO, said some policies advocated by both Hillary Clinton and Donald Trump “are not good for innovation, not good for competition, and not good for patient access.” In an interview with Bloomberg’s David Westin, Frazier blamed the current spotlight on pharmaceutical drug costs partially on the “heat of the political system.” He said he hopes the conversation will pivot towards more productive conversation about the affordability of the health care system more broadly after the election. “I think the debate about health care today is polarizing. I think it falsely pits all pharmaceutical companies against society, and the reality is, society needs these drugs,” Frazier said. (Owens, 7/1)

One of Martin Shkreli’s former companies has emerged from Chapter 11 bankruptcy and is pledging to ditch its notorious ex-chief’s price hike plans for a rare disease drug. ... Shkreli originally became infamous for his other former company Turing Pharma’s 5,000% price hike for a drug used by cancer and AIDS patients. But before his arrest, he said he’d use KaloBios as a vehicle to nab another niche drug, this time for treatment of the parasitic infection Chagas disease, and dramatically increase its price to the $60,000 to $100,000 range after helping it win FDA approval (the drug is approved in other countries and is provided to patients in the U.S. on a special and selective basis). Those plans were thrown into disarray after Shkreli’s arrest and subsequent ousting from the company, and KaloBios was ultimately forced to declare Chapter 11. But the biotech announced today that it has emerged from bankruptcy and landed a deal to buy the Chagas treatment, benznidazole, for $3 million. And it’s planning to hew to the responsible pricing model that it pledged several months ago. (Mukherjee, 7/1)