When the FDA’s Janet Woodcock pushed through a controversial approval for Sarepta’s Exondys 51 for Duchenne muscular dystrophy in September, she created a test case for payers who were essentially being asked to reimburse for an experimental drug.
But instead of rolling with the situation and paying a price that starts at $300,000 or so a year, many of the payers are kicking back hard, according to a survey of payers conducted by Jefferies.
“We conducted in depth due diligence on Exondys 51 launch with 4 private payers, 3 Medicaid experts, and 2 DMD KOLs with experience in administering Exondys 51,” noted Jefferies Gena Wang, who had been in the large contingent of analysts who had predicted a rejection for Sarepta. In addition we compiled a comprehensive list of published medical policies from 21 private payers (5 national & 15 regional MCOs; 1 PBM). Based on available data, 3/5 national and 8/15 regional managed care organizations (MCOs) have denied/restricted coverage for Exondys 51, in line with our expectation of pushback from private payers.”
That pushback has cost Sarepta $SRPT plenty. The biotech has seen its share price fade back by about half since the approval more than two months ago as questions have continued to circulate about payers’ position on the drug.
Anthem got the backlash rolling with its position that it will not cover an experimental drug, even though it’s been given an accelerated approval. And Humana followed up with restrictive rules that requires patients being able to walk so long as they are reimbursing for the drug. It’s clear from the Jefferies survey that a slight majority of payers don’t want to handle this like any other approved therapy for a rare and deadly disease.
The Exondys 51 approval triggered an internal civil war at the FDA, pitting top regulators against Woodcock, who expressed support for the drug and the company, even though it had only been studied in a tiny trial and the data had been harshly reviewed by internal regulators. That view helped set the stage for its rejection by a panel of outside experts, which also didn’t help the drug’s chances once it was handed over to payers to decide.
The kickback from payers is going to make it much harder for some of these families to get this drug, just when they felt that the biggest hurdle had already been cleared.
The best place to read Endpoints News? In your inbox.
Comprehensive daily news report for those who discover, develop, and market drugs. Join 31,500+ biopharma pros who read Endpoints News by email every day.Free Subscription