Fresenius limits charge for dialysis drug

[okarol]

September 16, 2008

Fresenius limits charge for dialysis drug

FTC negotiates deal for Medicare

By JAMES ROWLEY
Bloomberg News

WASHINGTON — Fresenius Medical Care AG, the world's largest provider of dialysis services for chronic kidney disease, agreed to Medicare reimbursement restrictions to settle U.S. charges that its acquisition of a license for an iron-deficiency drug would lead to higher prices.

The Federal Trade Commission announced the agreement Monday in Washington. It said the German drugmaker's acquisition of the U.S. license for the drug Venofer would force Medicare, the U.S. government health-care program, to pay higher prices for the medication.

Fresenius acquired Nashville-based Renal Care Group Inc. in March 2006.

Fresenius agreed to charge Medicare a market-based price for Venofer, the FTC said. The drug is administered intravenously to kidney patients on dialysis to treat a life-threatening iron deficiency.

The agreement "will ensure that the transaction will not increase the prices for this life-saving drug," said David P. Wales, acting head of the FTC's competition bureau. Medicare pays hundreds of millions of dollars annually for intravenous iron products for dialysis patients.

Under Medicare rules, dialysis clinics are paid the manufacturers' "higher average selling price" plus 6 percent. Without today's agreement, Medicare reimbursement costs could rapidly increase, the FTC said.

Venofer is one of two drugs most commonly used to treat iron deficiencies in kidney patients and is made by Luitpold Pharmaceuticals Inc.

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