Novartis bullish on Entresto launch, but not until 2016

The prospects for Novartis’ new heart failure drug Entresto dominated discussions during its second-quarter results meeting this week, as the company fielded questions about the expected take-up of the drug.

Entresto (sacubitril and valsartan) is fast becoming a test-case for the pharma industry as it makes a case for the value of new products, particularly in therapeutic categories that have high patient populations and are already fairly well-served by existing medicines.

Novartis is certainly buoyant about grabbing FDA approval for the drug earlier this month, with chief executive Joe Jimenez telling investors yesterday it was “a major event for the company” and “one of the most important cardiology advances in the last decade.”

He is equally clear that Novartis will have to make a very strong case to healthcare payers, however, given that the drug has been launched at a price of around $12.50 per day and current, mainly generic therapies cost significantly less.

The annual cost of around $4,500 is a far cry from the $100,000-plus price tags seen with new cancer and hepatitis drugs, for example, but need to be gauged against a generic CE inhibitor such as enalapril that cost just $100 a year.

The clinical benefits of the drug are not in question. In trials, Entresto improved cardiovascular death and hospitalisations by around 20 percent compared to the current standard of care in patients with heart failure and reduced ejection fraction, whilst also cutting all-cause mortality by 16 percent.

However, in an interview with the Wall Street Journal, Jimenez acknowledged that the company is looking hard at bundling additional services alongside the product -for example remote monitoring devices to allow doctors to keep tabs on their patients’ condition – in order to win over insurers.

Meanwhile, Jimenez has previously indicated that Novartis would consider a value-based pricing approach for Entresto, with payment for the drug based on clinical outcomes rather than tablet sales, although details of how this would work in practice have not been revealed.

The debate is not stopping analysts predict sales of $5 billion or more for Entresto, which also looks set to have the market to itself for some time as competition to sacubitril – a first-in-class neprilysin inhibitor – is thought to be years behind.

Novartis’ head of pharma David Epstein said that the drug is being very well-received by doctors in the field as it has a strong label claim, including superiority over enalapril, although he stressed there has so far been no feedback from payers as “their processes take weeks, or … sometimes months.”

“We would anticipate that since this population is highly Medicare – about 65 percent – those Medicare plans will take six plus months to make their decision,” he told investors.

“I know everybody is trying to model what the back half of 2015 will look like for Entresto, but it’s really too early to say.”

Novartis is anticipating an opinion by the Committee for Medicinal Products for Human Use (CHMP) in the fourth quarter of this year.

Entresto’s performance in the coming couple of years is particularly important given that Novartis is facing pressure one some other key product lines, notably cancer drugs Glivec (imatinib) – which is facing the threat of patent expiry – and Afinitor (everolimus) which could be impacted by competition from other drugs such as the new PD-1 inhibitors.

Novartis reported second quarter revenues down 5 percent to $12.7 billion – mainly because of its under-performing Alcon eyecare division – while pharma sales dipped 4 percent to $7.8 billion.

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