December 09, 2024

Warren Slams Inhaler Manufacturer GSK for its Billion Dollar Drug Price-Gouging Scheme, Harming Millions of Children

GSK withdrew its brand-name inhaler Flovent from the market, replacing it with an “authorized generic” that is four times more expensive

GSK’s abusive tactics will cost state Medicaid programs nearly $1 billion this year

“Patients, providers, and taxpayers deserve answers for your unconscionable profiteering”

Text of Letter (PDF)

Washington, D.C. - U.S. Senator Elizabeth Warren (D-Mass.) sent GlaxoSmithKline (GSK) a follow-up letter on its decision to discontinue Flovent HFA, the go-to inhaler for children, and replace it with an authorized generic version of the drug. This comes after new research from John Hopkins University revealed that GSK’s pricing scheme was costing patients, taxpayers, and state Medicaid programs.

In March 2024, Senator Warren sent GSK a letter raising concerns about its decision to discontinue Flovent HFA and replace it with a more costly authorized generic version of the drug. The decision appeared to be driven by a loophole that GSK began abusing after Congress lifted the Medicaid rebate cap, forcing manufacturers to increase rebate payments back to the Medicaid program. GSK’s response failed to answer the majority of Senator Warren’s questions regarding pricing decisions for the authorized generic inhaler, which is manufactured by Prasco. Though GSK provided pricing information for Flovent HFA’s net price after rebates and discounts, the company claimed it was impossible for it to provide comparable information for the “authorized generic.”

In a new report, researchers from Johns Hopkins University found that GSK’s decision to remove the inhaler will cost state Medicaid programs nearly $1 billion in 2024. By discontinuing Flovent HFA and peddling its own authorized generic, which it claims is cheaper for patients, the company will charge higher prices - and refund less in rebates. GSK will avoid $367.6 million in rebate payments to Medicaid and instead charge Medicaid over $551.8 million in 2024.

In addition, many health insurers have chosen not to cover the authorized generic version of the drug because of its cost. Doctors have scrambled to shift their patients over to the only other viable alternative for children with asthma, Asmanex, which has experienced shortages as demand surges. This crisis has left millions of children without reliable access to life-saving medication, straining families and healthcare providers.

“Congress passed new laws to make drugs cheaper for patients and taxpayers,” said Senator Warren. “But GSK figured out a loophole - and is instead charging four times as much for the same drug. This is outrageous behavior with real public health consequences.”

Senator Warren has requested a complete response to the follow-up questions by no later than December 18, 2024.

Senator Warren has led efforts to use every tool available to the government to lower drug prices and fight anticompetitive business practices in the health care industry:

  • In October 2024, wrote to Chair Lina Khan of the Federal Trade Commission (FTC) urging the FTC to closely scrutinize two proposed deals in the oncology market and block them if they violate antitrust law.
  • In October 2024, Senator Elizabeth Warren (D-Mass.) urged the FTC to closely scrutinize the Novo Nordisk-Catalent merger and to block it if it violated antitrust law.
  • In September 2024, Senator Elizabeth Warren (D-Mass.) and Representative Lloyd Doggett (D-Texas) wrote to Department of Health and Human Services (HHS) Secretary Xavier Becerra asking him to lower the cost of vital weight-loss drugs by using the agency’s existing legal authority to issue generic licenses for semaglutide, a prescription drug sold under the names Ozempic and Wegovy.
  • In August 2024, Senators Warren and King and Representative Doggett wrote to Department of Health and Human Services Secretary Xavier Becerra and Department of Commerce Secretary Gina Raimondo reiterating their agencies’ clear legal authority to use “march-in” rights under the Bayh-Dole Act to lower drug prices for Americans.
  • In June 2024, Senator Warren and Representative Pramila Jayapal (D-Wash.) sent letters to eight pharmaceutical companies urging them to voluntarily de-list over 100 patents that the Federal Trade Commission (FTC) has determined may be improperly or inaccurately listed in the Food and Drug Administration’s (FDA’s) Orange Book, which would open opportunity for more competition and lower drug prices for Americans.
  • In May 2024, Senator Warren and Representative Lloyd Doggett (D-Texas) sent a letter to Secretary of the Department of Commerce, Gina Raimondo, and Under Secretary Laurie Locascio, highlighting the lawmakers’ new review of public comments on the agency’s Draft Interagency Guidance Framework for Considering the Exercise of March-In Rights and urged them to strengthen and finalize the guidance.
  • In May 2024, Senators Warren, Bernie Sanders (I-Vt.), and Jeff Merkley (D-Ore.) wrote to the Chamber of Commerce expressing concern and demanding an explanation for the organization’s opposition to the Biden administration’s proposal to boost competition and lower drug prices for American families and businesses by allowing agencies to consider price when deciding to exercise their “march-in rights” under the Bayh-Dole Act.
  • In April 2024, Senator Elizabeth Warren (D-Mass.) sent a letter to the leadership of Novo Nordisk (Novo), slamming the company for its decision to discontinue production of Levemir (detemir) insulin, one of only three long-acting insulins on the market, and asked the company to commit to continue producing Levemir until a biosimilar is made available.
  • In March 2024, Senator Warren sent a letter in response to GlaxoSmithKline (GSK) discontinuing the brand-name version of Flovent HFA, the go-to inhaler for children, blasting the company for its price-gouging strategy that may cause millions of children to lose access to one of the few drugs that is appropriate to treat their asthma and allergies.
  • In February 2024, Senators Warren and Angus King (I-Maine) and U.S. Representative Lloyd Doggett (D-Texas) led 75 lawmakers in sending a letter to the Biden administration in support of strengthening and finalizing its draft guidance to protect taxpayers and reduce prescription drug prices. The lawmakers submitted a public comment supporting the “Interagency Guidance Framework for Considering the Exercise of March-In Rights” and calling for changes to ensure increased transparency, oversight, and accessibility of medical products invented through taxpayer-funded research and development.
  • In February 2024, Senator Warren and Representative Jayapal announced that three drug manufacturers pulled their sham patents after warnings and urged the FDA to continue fighting against Big Pharma’s patent abuse.
  • In December 2023, Senator Warren published an op-ed in Newsweek commending the Biden administration’s announcement that price can be considered in the government’s decision to march-in on a drug, effectively lowering drug costs, and calling on Americans to fight back against an industry that has been taking advantage of them for decades.
  • In December 2023, Senator Warren issued a statement after the Biden administration announced it would issue guidance to federal agencies that would allow the government to seize patents of certain expensive drugs developed with taxpayer support to create more competition and lower prices.
  • In December 2023, Senator Warren and Representative Jayapal sent letters to the CEOs of 8 pharmaceutical companies urging them to voluntarily remove sham patent claims improperly included in the FDA’s Orange Book and end their unlawful practices that delay competition and drive-up costs for patients and taxpayers.
  • In December 2023, Senator Warren and Representative Jan Schakowsky (D-Ill.) reintroduced the Affordable Drug Manufacturing Act, legislation that would radically reduce drug prices through public manufacturing of prescription drugs.
  • In September 2023, Senator Warren and Representative Jayapal sent a letter to FTC Chair Lina Khan urging the FTC to issue a policy statement about the improper listing of drug-related patents in the FDA’s Orange Book.
  • In August 2023, Senator Warren and Representative Jayapal sent a letter to FDA Commissioner Dr. Robert M. Califf, urging him to close loopholes that pharmaceutical companies have exploited to block generics from entering the market, keeping drug prices high and maximizing profits.

###