FDA Allows De Facto Generic of Pricey Preemie Drug Makena

VIDEO: Price rises from $20 to $1,500 per shot after drug maker awarded exclusivity.

The Food and Drug Administration has no intention of enforcing a regulation that one drug company sought to exploit to drive out competitors, an FDA official told ABC News.

The regulation invoked earlier this month by KV Pharmaceuticals would have allowed to company corner the market for a drug used to prevent preterm births, and sell it for 150 times what had been the going price.

KV Pharmaceuticals gained exclusive rights in February to produce a progesterone shot used to prevent preemie birth, previously known as 17P, that it branded Makena. The shot had been offered by compounding pharmacies for between $10 and $20 per dose, but KV planned to sell it for $1,500 per dose.

The company then sent cease-and-desist letters to compounding pharmacies, saying the FDA would take action against them if they continued to synthesize the drug.

The FDA's official statement as of Wednesday is that "this is not correct" -- the FDA will not take action against these companies.

"In order to support access to this important drug, at this time and under this unique situation, FDA does not intend to take enforcement action against pharmacies that compound hydroxyprogesterone caproate based on a valid prescription for an individually identified patient unless the compounded products are unsafe, of substandard quality, or are not being compounded in accordance with appropriate standards for compounding sterile products," the FDA told ABC News.

Because the FDA has no control over how companies it grants drug approval set prices, some health care experts said these comments, couched in anonymity, seem like an attempt to lessen the unintended consequences of the decision to grant KV Pharmaceuticals seven years of exclusive rights to the drug under the Orphan Drug Act.

As a result of this official stance, many doctors will be able to bypass KV Pharmaceuticals and continue prescribing this progesterone shot at the affordable compounding pharmacy price women are used to.

"I am hopeful that this statement will give small compounding pharmacies the confidence that they are legally on safe ground to compound and distribute [this drug]. Obstetricians will have the option to prescribe an affordable product. It is important to have this competitive force in the market. I am very encouraged by this news," says Dr. M. Kathryn Menard, director of the Center for Maternal and Infant Health at University of North Carolina School of Medicine.

KV Pharmaceuticals says it will announce their plan for addressing the price concerns later this week, noting that an expansion of the financial assistance program they have in place for low-income mothers may be in the works.

Maternity Advocates Challenge High Cost of Preterm Birth Drug

Even if some doctors will continue to use compounding pharmacies to get 17-P, Medicaid and health insurance providers will have to contend with the high price of Makena.

That leaves maternity care advocates worried about patients' access to a drug whose importance, Menard said, cannot be understated.

"This is the only evidence-based approach we have, medication we have to prevent pre-term birth," she said.

It wasn't always easy to find places that made the medication, however, said Dr. Michael Lindsay, division director of Maternal-Fetal Medicine at Emory University School of Medicine.

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