New drug price con­tro­ver­sy looms as Bio­gen stuns pay­ers with Spin­raza­'s $750K stick­er — an­a­lyst

Ge­of­frey Porges, Leerink

One promi­nent an­a­lyst be­lieves we may soon see a new drug price con­tro­ver­sy erupt, on­ly this one will have noth­ing to do with price goug­ing on an old ther­a­py.

The drug is Spin­raza, the new­ly ap­proved pi­o­neer­ing ther­a­py for rare cas­es of spinal mus­cu­lar at­ro­phy from Bio­gen and its part­ners at Io­n­is. Ear­li­er this week Bio­gen priced the drug at about $750,000 for the first year and half that for each year af­ter, or $1.5 mil­lion over three years.

And a pres­i­den­tial-lev­el Tweet storm may not be far be­hind, says Leerink’s Ge­of­frey Porges. He notes:

“The stick­er-shock pre­sent­ed in the me­dia could turn Spin­raza in­to the So­val­di of rare dis­ease drugs, or the straw that breaks the camel’s back in terms of the US mar­ket’s tol­er­ance for rare dis­ease drug pric­ing. At the very least, and im­plied in our up­dat­ed mod­el, the price is go­ing to force pay­ers to close­ly scru­ti­nize which pa­tients re­ceive ac­cess and lim­it the over­all ac­cess pro­vid­ed. To us it seems cer­tain that pa­tients who have the less se­vere Type III and IV forms of the dis­ease or who are old­er with rel­a­tive­ly milder symp­toms will find it dif­fi­cult to ob­tain treat­ment.”

The price is sub­stan­tial­ly above what Porges had fore­cast, but it isn’t nec­es­sar­i­ly way out of line, he notes. Oth­er rare dis­ease drugs have a built-in price es­ca­la­tion mod­el as pa­tients start on a drug as in­fants and then in­crease their dosage as they grow old­er. Bio­gen won’t be able to hide any price hike un­der its flat price, and over­all the Spin­raza price won’t be that far off from oth­er rare dis­eases.

In the mean­time, look for Bio­gen to ben­e­fit from a sud­den surge in rev­enue once the new drug be­comes avail­able.

Its in­ter­est­ing to note on our end that drug price con­tro­ver­sies come in sev­er­al mod­els. Spin­raza and So­val­di may be sub­ject to a pay­er back­lash as cer­tain new drugs com­mand jaw-drop­ping prices that can stun in­sur­ers. Rare dis­ease drugs, though, have gen­er­al­ly not at­tract­ed the kind of at­ten­tion that So­val­di gar­nered, with its fo­cus on a ma­jor dis­ease like he­pati­tis C.

Then there are the Tur­ings and Valeants of the world, which jacked up prices on old drugs and at­tract­ed the at­ten­tion of law­mak­ers who re­spond­ed to the on­line lynch mobs that formed to de­mand a re­sponse. But even with pub­lic hear­ings and reg­u­lar con­dem­na­tion, Tur­ing didn’t budge on its price for Dara­prim.

Fi­nal­ly, there’s the reg­u­lar price es­ca­la­tion that can add up to big mon­ey over the years, a busi­ness mod­el fol­lowed by most of the bio­phar­ma world. Now that strat­e­gy is al­so com­ing un­der pres­sure as in­dus­try in­sid­ers like Al­ler­gan CEO Brent Saun­ders chal­lenge the in­dus­try to self-reg­u­late prices, lim­it­ing an­nu­al price hikes to mod­est sin­gle-dig­it in­creas­es.

The ju­ry is still out on that one, but the in­dus­try is far from rush­ing in­to a whole­heart­ed em­brace of price dis­ci­pline, es­pe­cial­ly as R&D con­tin­ues to dis­ap­point most ma­jor man­u­fac­tur­ers.

Tar­get­ing a Po­ten­tial Vul­ner­a­bil­i­ty of Cer­tain Can­cers with DNA Dam­age Re­sponse

Every individual’s DNA is unique, and because of this, every patient responds differently to disease and treatment. It is astonishing how four tiny building blocks of our DNA – A, T, C, G – dictate our health, disease, and how we age.

The tricky thing about DNA is that it is constantly exposed to damage by sources such as ultraviolet light, certain chemicals, toxins, and even natural biochemical processes inside our cells.¹ If ignored, DNA damage will accumulate in replicating cells, giving rise to mutations that can lead to premature aging, cancer, and other diseases.

Ken Frazier, Merck CEO (Bess Adler/Bloomberg via Getty Images)

UP­DAT­ED: Mer­ck takes a swing at the IL-2 puz­zle­box with a $1.85B play for buzzy Pan­dion and its au­toim­mune hope­fuls

When Roger Perlmutter bid farewell to Merck late last year, the drugmaker perhaps best known now for sales giant Keytruda signaled its intent to take a swing at early-stage novelty with the appointment of discovery head Dean Li. Now, Merck is signing a decent-sized check to bring an IL-2 moonshot into the fold.

Merck will shell out roughly $1.85 billion for Pandion Pharmaceuticals, a biotech hoping to gin up regulatory T cells (Tregs) to treat a range of autoimmune disorders, the drugmaker said Thursday.

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Roivant par­lays a $450M chunk of eq­ui­ty in biotech buy­out, grab­bing a com­pu­ta­tion­al group to dri­ve dis­cov­ery work

New Roivant CEO Matt Gline has crafted an all-equity upfront deal to buy out a Boston-based biotech that has been toiling for several years now at building a supercomputing-based computational platform to design new drugs. And he’s adding it to the Erector set of science operations that are being built up to support their network of biotech subsidiaries with an eye to growing the pipeline in a play to create a new kind of pharma company.

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Fol­low biotechs go­ing pub­lic with the End­points News IPO Track­er

The Endpoints News team is continuing to track IPO filings for 2021, and we’ve designed a new tracker page for the effort.

Check it out here: Biopharma IPOs 2021 from Endpoints News

You’ll be able to find all the biotechs that have filed and priced so far this year, sortable by quarter and listed by newest first. As of the time of publishing on Feb. 25, there have already been 16 biotechs debuting on Nasdaq so far this year, with an additional four having filed their S-1 paperwork.

Doug Ingram (file photo)

Why not? Sarep­ta’s third Duchenne MD drug sails to ac­cel­er­at­ed ap­proval

Sarepta may be running into some trouble with its next-gen gene therapy approach to Duchenne muscular dystrophy. But when it comes to antisense oligonucleotides, the well-trodden regulatory path is still leading straight to an accelerated approval for casimersen, now christened Amondys 45.

We just have to wait until 2024 to find out if it works.

Amondys 45’s approval was unceremonious, compared to its two older siblings. There was no controversy within the FDA over approving a drug based on a biomarker rather than clinical benefit, setting up a powerful precedent that still haunts acting FDA commissioner Janet Woodcock as biotech insiders weighed her potential permanent appointment; no drama like the FDA issuing a stunning rejection only to reverse its decision and hand out an OK four months later, which got more complicated after the scathing complete response letter was published; no anxious tea leaf reading or heated arguments from drug developers and patient advocates who were tired of having corticosteroids as their loved ones’ only (sometimes expensive) option.

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S&P ex­pects steady ero­sion in Big Phar­ma's cred­it pro­file in 2021 as new M&A deals roll in — but don't un­der­es­ti­mate their un­der­ly­ing strength

S&P Global has taken a look at the dominant forces shaping the pharma market and come to the conclusion that there will be more downgrades than upgrades in 2021 — the 8th straight year of steady decline.

But it’s not all bad news. Some things are looking up, and there’s still plenty of money to be made in an industry that enjoys a 30% to 40% profit margin, once you factor in steep R&D expenses.

With dust set­tled on ac­tivist at­tack, Lau­rence Coop­er leaves Zio­pharm to a new board

Laurence Cooper has done his part.

In the five years since he left a tenured position at Houston’s MD Anderson Cancer Center to become CEO of Boston-based Ziopharm, he’s steered the small-cap immunotherapy player through patient deaths in trials, clinical holds, short attacks and, most recently, an activist attack on the board.

So when the company has “fantastic news” like an IND clearance for a TCR T cell therapy program, he’s ready to pass on the baton.

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Steve Cutler, Icon CEO (Icon)

In the biggest CRO takeover in years, Icon doles out $12B for PRA Health Sci­ences to fo­cus on de­cen­tral­ized clin­i­cal work

Contract research M&A had a healthy run in recent years before recently petering out. But with the market ripe for a big buyout and the Covid-19 pandemic emphasizing the importance of decentralized trials, Wednesday saw a tectonic shift in the CRO world.

Icon, the Dublin-based CRO, will acquire PRA Health Sciences for $12 billion in a move that will shake up the highest rungs of a fragmented market. The merger would combine the 5th- and 6th-largest CROs by 2020 revenue, according to Icon, and the merger will set the newco up to be the second-largest global CRO behind only IQVIA.

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J&J ad­comm live blog: Com­mit­tee votes 22-0 to rec­om­mend an FDA OK for the J&J vac­cine, set­ting up 3rd US Covid-19 jab

The US could have a third authorized Covid-19 vaccine within hours.

The FDA’s advisory committee voted unanimously — 22-0 — to recommend the agency issue an emergency use authorization for J&J’s vaccine. If they follow the precedent of the Pfizer and Moderna vaccine,  the FDA will likely authorize the vaccine by Saturday, immediately adding a few million doses to the US supply and adding a 100 million by June. An authorization would give the world its first single-dose vaccine, a major weapon in the effort to vaccinate the world and bring the virus to heel, particularly in rural and developing areas.