US drug cost body calls for SMA drug price cuts

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A US drug cost-effectiveness group has said that Biogen should cut the price of its already-approved spinal muscular atrophy (SMA) drug, while the $4-$5 million Novartis is suggesting for an unapproved gene therapy for the disease is excessive.

Biogen charges $750,000 for the first year of treatment with Spinraza (nusinersen) for SMA, and $375,000 annually after, a controversially high price that has added to the ongoing debate about affordability of drugs.

But the increasingly influential non-profit Institute for Clinical and Economic Review (ICER) said in its final report that Spinraza’s list price needs to be “far lower” to be cost effective.

The drug is important for Biogen, generating $1.7 billion last year, at a time when the company is looking to rebuild after the costly failure of its late-stage Alzheimer’s candidate aducanumab.

ICER uses as a “quality-adjusted life year” (QALY) similar to that used by England’s NICE, and determined that each year of healthy or near-healthy life resulting from the treatment is worth $100,000-$150,000.

With an alternative benchmark, known as life-year gained (LYG) based on the additional number of years a person lives due to a treatment, Spinraza is worth $83,000 to $145,000 in year one, and $41,000 to $72,000 annually thereafter, ICER determined.

Findings in ICER’s final report were in line with recommendations issued in a draft in February.

SMA can lead to paralysis, breathing problems and death within months in babies born with the most serious form of the disease, and is the leading genetic cause of death in infants.

Novartis’ Zolgensma could get approved by the FDA next month, and while the Swiss pharma has not yet confirmed a price has said that its one-off gene therapy shot could be cost-effective at up to $5 million.

The therapy uses a genetically engineered virus to deliver a functional copy of the SMN1 gene to motor neurons in SMA patients.

According to ICER’s QALY calculations, Zolgensma would be worth $310,000 to $900,000 for type 1 SMA patients, or $710,000 to $1.5 million using the LYG assessment.

Based on discussions with the rare disease community Novartis argues that $500,000 per QALY is a more appropriate standard for transformational gene therapies. At that level Zolgensma would be cost-effective at $5 billion.