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Brainstorm Health: Novartis $2.1 Million Drug, Brexit Fallout, Jakafi Drug Approval

May 24, 2019, 9:34 PM UTC
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Happy Friday, readers!

On Friday, drug giant Novartis got the Food and Drug Administration (FDA) green light for a first-of-its-kind gene therapy to treat a rare, devastating genetic muscle-wasting disorder called spinal muscular atrophy (SMA). This victory was largely expected; all eyes, however, were on where Novartis would place the treatment’s list price.

Speculation was rampant. Would it be $2 million? $4 million? Even more? After all, Novartis CEO Vas Narasimhan had taken pains to argue that the therapy, Zolgensma, would be “cost-effective” at list prices nearing $5 million given SMA’s devastating nature and the fact that this treatment is a one-off medicine.

The company decided not to go quite that far in the end. But the number they’ve settled on still gives Zolgensma the distinction of being the world’s most expensive drug (at least by list price) at a $2.125 million tag.

Novartis has continued to assert this is a reasonable price, especially since it’s following it up with a number of unique payment programs. For instance, the company is offering an installment payment program to insurers who’d like to participate (and, technically, it’s “only” $425,000 per year over the course of five years, which is still cheaper than other available options, the firm’s executives say).

So what do the watchdogs have to say? Technically, the price tag falls within the higher range of cost-effectiveness pegged by groups like the Institute for Clinical and Economic Review (ICER), a persistent industry gadfly.

What will be more interesting to see going forward is what actual patients’ experience will be with the proposed pricing system, and what government regulators may do in the meantime. For now, welcome to the era of the world’s most expensive drug. And maybe don’t be shocked that the announcement comes ahead of a long weekend.

We’ll be off on Monday in observance of the Memorial Day holiday and back in your inboxes on Tuesday, May 28. In the meantime, read on for the day’s news and have a great Memorial Day.

Sy Mukherjee


ICER revives Sarepta gene therapy debate. Speaking of drug pricing - ICER handed out another (and less positive) overview of a different pioneering medicine. The asset on the hot seat this time around is Sarepta's Exondys 51, which became the first approved treatment for the muscle-wasting disorder Duchenne muscular dystrophy a few years back (and to major controversy). ICER concludes that the treatment is not cost effective or, well, just generally all that effective for most Duchenne patients.

FDA approves Incyte drug for graft versus host. Biotech firm Incyte received its own important FDA approval on Friday, an expanded indication for Jakafi in treating a form of graft-versus-host disease. This is the first-ever medicine approved in this particular indication, and Incyte stock was up about 2% in Friday trading.


Theresa May is out. What will Brexit mean for health care? With Theresa May announcing this morning that she'll resign as leader of the U.K.'s Conservative party and her role as Prime Minister, there are renewed questions about what Brexit will mean for the pharmaceutical supply chain. The answers are... Complicated. And they depend on a whole lot of issues that have yet to be settled (will there be an agreement set with the E.U., or a "no-deal" Brexit?) If it turns out to be the latter, public health officials have warned of potential disruptions to the pharmaceutical supply chain in the U.K. (which has already led some patients and drug makers to begin stockpiling medications).


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Produced by Sy Mukherjee
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