Regeneron Pharmaceuticals' CEO told CNBC on Tuesday that benefits companies should not try to practice medicine.
Dr. Leonard Schleifer was reacting to the recent news that Express Scripts, the country's largest pharmacy benefits manager, dropped reimbursement for Gilead Science's hepatitis C treatment because it got deep discounts from an AbbVie alternative.
Express Scripts wants to make "exclusive choices and say, 'Give us a huge discount and we'll take your drug and we won't take the other drug,'" Schleifer said in a "Squawk Box" interview amid concern that his company's experimental cholesterol drug could one day suffer the same fate. "I'm not in favor of that."
Regeneron faces competition from biotech giant Amgen in a race to bring a new type of cholesterol treatment to market.
Express Scripts defended the company's move, saying its decisions are "based on the clinical value of a drug."
"When there is more than one drug in a class and the clinical data are similar (efficacy, safety, adherence, etc.), we evaluate which would be the most cost-effective for our clients, the plan sponsors who shoulder nearly all the cost for drugs," company spokesman Brian Henry said via email to CNBC. "Express Scripts works to make sure payers and patients get the most value out of the innovative drugs pharmaceutical companies develop."
Gilead sparked a fierce debate over the cost of drugs after it priced its Sovaldi hepatitis C drug at $84,000 for 12 weeks of treatment, or about $1,000 a day. AbbVie's Viekira Pak was priced at $83,319.
Regeneron's Schleifer said, "Express Scripts, Regeneron, patients, doctors, we all have the same goals. We want to get good drugs that can make a difference in patients' lives and get them to patients in a way that they can afford them."
"It's better to have choice," he said. "But we have to get there by having fair prices."