Can Am­gen beat down pay­er re­sis­tance to Repatha with its own cost analy­sis?

PC­SK9 heart drugs have proven to be one of the biggest com­mer­cial dis­ap­point­ments in re­cent bio­phar­ma times. Held back by pay­ers who don’t see the val­ue in pro­vid­ing the drugs even at a hefty 30% or so dis­count on the list price, sales of Am­gen’s Repatha and Pralu­ent from Re­gen­eron/Sanofi have lan­guished — fur­ther ham­pered by cost analy­sis stud­ies that as­cribe a rel­a­tive­ly small val­ue to the drugs.

So now, in a wide­ly an­tic­i­pat­ed study of its own, Am­gen is lay­ing out the eco­nom­ic ar­gu­ment to jus­ti­fy its $14,523 list price of Repatha (evolocum­ab).

In what is bound to be quick­ly la­beled as a self-serv­ing analy­sis, Am­gen in­sists that if most pay­ers are re­fus­ing to pro­vide Repatha at less than $10,000 a year with the dis­count, many of their mem­bers may well be los­ing out.

Gregg Fonarow

To get to that con­clu­sion, the promi­nent in­ves­ti­ga­tors en­list­ed for this study used re­al-world num­bers on high-risk pa­tients, peg­ging it to qual­i­ty ad­just­ed life years (QALY), a con­tro­ver­sial, vari­able and com­mon­ly used mea­sure of as­sess­ment. They al­so not­ed that stick­ing with the pa­tient pop­u­la­tion re­cruit­ed for Am­gen’s big FOURI­ER study, the dis­count off the list price would need to be more than 50%.

That FOURI­ER study was sup­posed to be Am­gen’s tick­et to the block­buster sales that the lead­ers in this field feel they are due drugs that can sig­nif­i­cant­ly re­duce the risk of ma­jor car­dio events. In­stead, the lack of a mor­tal­i­ty ben­e­fit — fail­ing to sig­nif­i­cant­ly re­duce the risk of death — helped prompt pay­ers to hold fast with treat­ment guide­lines that con­tin­ue to de­ny cov­er­age to the vast ma­jor­i­ty of pa­tients in this huge mar­ket.

FOURI­ER is now used to demon­strate why Am­gen’s price should be far low­er than it is. In a study pub­lished in the Jour­nal of the Amer­i­can Med­ical As­so­ci­a­tion ear­li­er this week, re­searchers con­clud­ed that drug is worth no more than $4,536 a year, less than a third of its cur­rent list price.

Am­gen — which has been work­ing out mon­ey-back guar­an­tees in the event of a heart at­tack — dis­putes those num­bers. Giv­en pay­ers’ tren­chant at­ti­tudes, and the range of cost-jus­ti­fi­ca­tion re­ports now avail­able, their chance of suc­cess ap­pears lim­it­ed.

That pay­er kick­back is a key con­cern for every­one in drug de­vel­op­ment, where the opaque drug pric­ing sys­tem in the US — in­flat­ed list prices and un­cer­tain net amounts tend to cre­ate more con­fu­sion than clar­i­ty — is be­dev­il­ing the fu­ture of many drugs now in de­vel­op­ment. Get­ting the da­ta need­ed for an ap­proval is no guar­an­tee of com­mer­cial suc­cess, and that is a key is­sue that will bear in­creas­ing in­flu­ence in Big Phar­ma’s de­ci­sions about what it wants in the pipeline.

Am­gen’s as­sess­ment in­cludes this bot­tom line as­sess­ment of the val­ue of a drug that slash­es LDL by about 60% on av­er­age.

Sev­er­al clin­i­cal sce­nar­ios were ex­plored to de­ter­mine whether Repatha is worth the in­vest­ment, in­clud­ing event rates seen in re­al world clin­i­cal prac­tice set­tings, as well as event rates seen in the ac­tu­al out­comes tri­al, and in pa­tients who have high­er base­line LDL lev­els. The re­searchers de­ter­mined that to re­main be­low gen­er­al­ly ac­cept­ed cost-ef­fec­tive­ness thresh­olds in a typ­i­cal U.S. AS­CVD pop­u­la­tion ($150,000 per qual­i­ty ad­just­ed life year (QALY)), the an­nu­al net price for Repatha would need to be at or be­low $9,669. Tar­get­ing the more se­vere clin­i­cal prac­tice pop­u­la­tion with base­line LDL lev­els ≥100 mg/dL de­spite max­i­mal in­ten­si­ty statin ther­a­py re­veals that an an­nu­al net price of $13,225 is cost-ef­fec­tive. In a pop­u­la­tion with event rates seen in the Repatha out­comes study, $6,780 is cost-ef­fec­tive.

“This is the first cost-ef­fec­tive­ness as­sess­ment of evolocum­ab us­ing a mod­el based on a high- qual­i­ty out­comes tri­al, com­bined with U.S. clin­i­cal prac­tice da­ta. The analy­sis iden­ti­fies the types of high-risk pa­tients for whom this ther­a­py is both clin­i­cal­ly ben­e­fi­cial and cost-ef­fec­tive,” said Gregg Fonarow, pro­fes­sor of med­i­cine at UCLA David Gef­fen School of Med­i­cine and the study’s prin­ci­pal au­thor. “This study pro­vides a crit­i­cal in­put to the over­all cost-ef­fec­tive­ness de­bate that has sur­round­ed PC­SK9 in­hibitors.”

Vlad Coric (Biohaven)

In an­oth­er dis­ap­point­ment for in­vestors, FDA slaps down Bio­haven’s re­vised ver­sion of an old ALS drug

Biohaven is at risk of making a habit of disappointing its investors. 

Late Friday the biotech $BHVN reported that the FDA had rejected its application for riluzole, an old drug that they had made over into a sublingual formulation that dissolves under the tongue. According to Biohaven, the FDA had a problem with the active ingredient used in a bioequivalence study back in 2017, which they got from the Canadian drugmaker Apotex.

Norbert Bischofberger. Kronos

Backed by some of the biggest names in biotech, Nor­bert Bischof­berg­er gets his megaround for plat­form tech out of MIT

A little over a year ago when I reported on Norbert Bischofberger’s jump from the CSO job at giant Gilead to a tiny upstart called Kronos, I noted that with his connections in biotech finance, that $18 million launch round he was starting off with could just as easily have been $100 million or more.

With his first anniversary now behind him, Bischofberger has that mega-round in the bank.

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Chas­ing Roche's ag­ing block­buster fran­chise, Am­gen/Al­ler­gan roll out Avastin, Her­ceptin knock­offs at dis­count

Let the long battle for biosimilars in the cancer space begin.

Amgen has launched its Avastin and Herceptin copycats — licensed from the predecessors of Allergan — almost two years after the FDA had stamped its approval on Mvasi (bevacizumab-awwb) and three months after the Kanjinti OK (trastuzumab-anns). While the biotech had been fielding biosimilars in Europe, this marks their first foray in the US — and the first oncology biosimilars in the country.

Seer adds ex-FDA chief Mark Mc­Clel­lan to the board; Her­cules Cap­i­tal makes it of­fi­cial for new CEO Scott Bluestein

→ On the same day it announced a $17.5 million Series C, life sciences and health data company Seer unveiled that it had lured former FDA commissioner and ex-CMS administrator Mark McClellan on to its board. “Mark’s deep understanding of the health care ecosystem and visionary insights on policy reform will be crucial in informing our thinking as we work to bring our liquid biopsy and life sciences products to market,” said Seer chief and founder Omid Farokhzad in a statement.

Daniel O'Day

No­var­tis hands off 3 pre­clin­i­cal pro­grams to the an­tivi­ral R&D mas­ters at Gilead

Gilead CEO Daniel O’Day’s new task hunting up a CSO for the company isn’t stopping the industry’s dominant antiviral player from doing pipeline deals.

The big biotech today snapped up 3 preclinical antiviral programs from pharma giant Novartis, with drugs promising to treat human rhinovirus, influenza and herpes viruses. We don’t know what the upfront is, but the back end has $291 million in milestones baked in.

Vas Narasimhan, AP Images

On a hot streak, No­var­tis ex­ecs run the odds on their two most im­por­tant PhI­II read­outs. Which is 0.01% more like­ly to suc­ceed?

Novartis CEO Vas Narasimhan is living in the sweet spot right now.

The numbers are running a bit better than expected, the pipeline — which he assembled as development chief — is performing and the stock popped more than 4% on Thursday as the executive team ran through their assessment of Q2 performance.

Year-to-date the stock is up 28%, so the investors will be beaming. Anyone looking for chinks in their armor — and there are plenty giving it a shot — right now focus on payer acceptance of their $2.1 million gene therapy Zolgensma, where it’s early days. And CAR-T continues to underperform, but Novartis doesn’t appear to be suffering from it.

So what could go wrong?

Actually, not much. But Tim Anderson at Wolfe pressed Narasimhan and his development chief John Tsai to pick which of two looming Phase III readouts with blockbuster implication had the better odds of success.

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Francesco De Rubertis

Medicxi is rolling out its biggest fund ever to back Eu­rope's top 'sci­en­tists with strange ideas'

Francesco De Rubertis built Medicxi to be the kind of biotech venture player he would have liked to have known back when he was a full time scientist.

“When I was a scientist 20 years ago I would have loved Medicxi,’ the co-founder tells me. It’s the kind of place run by and for investigators, what the Medicxi partner calls “scientists with strange ideas — a platform for the drug hunter and scientific entrepreneur. That’s what I wanted when I was a scientist.”

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Af­ter a decade, Vi­iV CSO John Pot­tage says it's time to step down — and he's hand­ing the job to long­time col­league Kim Smith

ViiV Healthcare has always been something unique in the global drug industry.

Owned by GlaxoSmithKline and Pfizer — with GSK in the lead as majority owner — it was created 10 years ago in a time of deep turmoil for the field as something independent of the pharma giants, but with access to lots of infrastructural support on demand. While R&D at the mother ship inside GSK was souring, a razor-focused ViiV provided a rare bright spot, challenging Gilead on a lucrative front in delivering new combinations that require fewer therapies with a more easily tolerated regimen.

They kept a massive number of people alive who would otherwise have been facing a death sentence. And they made money.

And throughout, John Pottage has been the chief scientific and chief medical officer.

Until now.

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H1 analy­sis: The high-stakes ta­ble in the biotech deals casi­no is pay­ing out some record-set­ting win­nings

For years the big trend among dealmakers at the major players has been centered on ratcheting down upfront payments in favor of bigger milestones. Better known as biobucks for some. But with the top 15 companies competing for the kind of “transformative” pacts that can whip up some excitement on Wall Street, with some big biotechs like Regeneron now weighing in as well, cash is king at the high stakes table.

We asked Chris Dokomajilar, the head of DealForma, to crunch the numbers for us, looking over the top 20 deals for the past decade and breaking it all down into the top alliances already created in 2019. Gilead has clearly tipped the scales in terms of the coin of the bio-realm, with its record-setting $5 billion upfront to tie up to Galapagos’ entire pipeline.

Dokomajilar notes:

We’re going to need a ‘three comma club’ for the deals with over $1 billion in total upfront cash and equity. The $100 million-plus club is getting crowded at 164 deals in the last decade with new deals being added towards the top of the chart. 2019 already has 14 deals with at least $100 million in upfront cash and equity for a total year-to-date of over $9 billion. That beats last year’s $8 billion and sets a record.

Add upfronts and equity payments and you get $11.5 billion for the year, just shy of last year’s record-setting $11.8 billion.

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