Stick­er shock: No­var­tis says its top drug prospect is worth $4M-$5M for a once-and-done use

Val­ue and pric­ing in life-long rare dis­ease treat­ment. (No­var­tis, page 48)

AveX­is man­aged to grab the in­dus­try’s at­ten­tion when re­searchers post­ed ear­ly and stun­ning re­sults for their life-sav­ing gene ther­a­py to treat rare cas­es of spinal mus­cu­lar at­ro­phy. They were back in the spot­light when No­var­tis reached out to buy the com­pa­ny for $8.7 bil­lion. And now they’re mak­ing a re­turn trip to cen­ter stage with an ar­gu­ment that their once-and-done ap­proach to SMA — AVXS-101 — could jus­ti­fi­ably be priced at $4 mil­lion to $5 mil­lion.

Dave Lennon (LinkedIn)

“Four mil­lion dol­lars is a sig­nif­i­cant amount of mon­ey, but we be­lieve this is a cost-ef­fec­tive point,” Dave Lennon, pres­i­dent of AveX­is told in­vestors ear­li­er to­day, ac­cord­ing to a re­port from Reuters. “We’ve shown through oth­er stud­ies we are cost ef­fec­tive in the range of $4-$5 mil­lion. And ul­ti­mate­ly, this is im­por­tant con­text as we con­sid­er how we’re go­ing to eval­u­ate val­ue for (the ther­a­py called) AVXS-101.”

No­var­tis out­lined their ar­gu­ment in a slide that used price guide­lines from the cost watch­dogs at ICER and NICE to make their case. ICER, for ex­am­ple, backed Roche’s $482,000 first-year price for Hem­li­bra, with a 10-year cost of $4.5 mil­lion. But it’s hard to see ei­ther group go­ing for $4 mil­lion worth of stick­er shock for a one-time ther­a­py. ICER re­ject­ed Spark’s $850,000 price tag for its gene ther­a­py for a rare form of blind­ness as ex­treme and need­ed to be cut by at least 50% to re­flect its true val­ue to pa­tients. And NICE has had no prob­lem re­ject­ing oth­er rare dis­ease drugs with much small­er prices at­tached.

No­var­tis may not ac­tu­al­ly be plan­ning to try and col­lect $4 mil­lion for their drug, and ex­ecs de­murred on pro­ject­ing the cost to­day. But they seem in­tent on soft­en­ing up the pay­er mar­ket for some­thing sig­nif­i­cant­ly high­er than $1 mil­lion — once con­sid­ered a jaw-drop­ping, break-the-bank sum.

And that would put them at the very top of the heap of the most ex­pen­sive drugs on the plan­et.

In their fa­vor: Ri­vals at Bio­gen charge $750,000 for the first year of Spin­raza, then $375,000 a year af­ter that — for life. That’s $1.87 mil­lion over 4 years. And they don’t get much grief for it.

At the very least, you can ex­pect a whole new dis­cus­sion around the pric­ing of gene ther­a­pies, as de­vel­op­ers dis­cuss dif­fer­ent pay plans to spread out the cost or of­fer var­i­ous mon­ey-back guar­an­tees.

Novotech CRO Ex­pands Chi­na Team as Biotech De­mand for Clin­i­cal Tri­als In­creas­es up to 79%

An increase in demand of up to 79% for clinical trials in China has prompted Novotech the Asia-Pacific CRO to rapidly expand the China team, appointing expert local clinical executives to their Shanghai and Hong Kong offices. The company is planning to expand their team by 30% over the next quarter.

Novotech China has seen considerable demand recently which is borne out by research from GlobalData:
A global migration of clinical research is occurring from high-income countries to low and middle-income countries with emerging economies. Over the period 2017 to 2018, for example, the number of clinical trial sites opened by biotech companies in Asia-Pacific increased by 35% compared to 8% in the rest of the world, with growth as high as 79% in China.
Novotech CEO Dr John Moller said China offers the largest population in the world, rapid economic growth, and an increasing willingness by government to invest in research and development.
Novotech’s 23 years of experience working in the region means we are the ideal CRO partner for USA biotechs wanting to tap the research expertise and opportunities that China offers.
There are over 22,000 active investigators in Greater China, with about 5,000 investigators with experience on at least 3 studies (source GlobalData).

Daniel O'Day [via AP Images]

UP­DAT­ED: Gilead un­leash­es a $5B late-stage cash al­liance with Gala­pa­gos — lay­ing out O'­Day's R&D strat­e­gy

Daniel O’Day is executing his first major development deal since taking over as CEO of Gilead $GILD. And he’s going in deep to ally himself with a longstanding partner.

O’Day announced today that he is spending $5 billion in cash to add new late-stage drugs to Gilead’s pipeline, picking up rights to Galapagos’ $GLPG Phase III IPF drug GLPG1690 alongside adoption of the biotech’s Phase IIb drug GLPG1972 for osteoarthritis. And Gilead is also putting billions more on the table for milestones, gaining options for everything else in Galapagos’ pipeline, with a shot at all rights outside of Europe.

Altogether, Gilead is gaining rights to 6 clinical-stage assets, 20 preclinical programs and everything else being hatched in translation.

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Alk­er­mes adds bipo­lar de­pres­sion to its FDA wish­list; Con­go con­firms first Ebo­la case in large city

→ An ever-ambitious Alkermes $ALKS team plans to add bipolar depression to its list of conditions for ALKS-3831, which it plans to pitch to the FDA in Q4. Alkermes says they were persuaded to add bipolar depression after a pre-NDA meeting with the agency, which came about 7 months after the biotech reported positive data for schizophrenia. The drug is a combo using olanzapine/samidorphan, which they hope will be shown to be as effective as olanzapine without the substantial increase in the risk of weight gain.

Pe­ter Kolchin­sky and Raj Shah raise a $300M fund de­vot­ed to biotech star­tups

Peter Kolchinsky and Raj Shah have another $300 million-plus to play with on the biotech venture side of their investment business. 

The two announced Monday morning that they’ve put together their first pure-play venture fund at RA Capital Management, which has been known to bet on just about every angle in healthcare investing — from rounds to follow-on investments at public companies. This new fund of theirs arrives well into a go-go era of new startup financing, with a particular focus on building new biotechs.

Boehringer buys Swiss biotech in its lat­est M&A deal, go­ing the next-gen can­cer vac­cine route

Boehringer Ingelheim has snapped up a Swiss biotech startup and added their group as a new platform for the oncology pipeline. 

The German biopharma company has bagged Geneva-based AMAL Therapeutics, paying out an unspecified upfront in a $358 million deal — cash, milestones and everything else, all in. Plus there’s 100 million euros on the line for commercial milestones.

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Ab­b­Vie beefs up the on­col­o­gy pipeline, bag­ging an up­start STING play­er with its own unique ap­proach

AbbVie isn’t letting its $63 billion buyout of Allergan stop its M&A/deals team from continuing their work.

Monday morning we learned that the pharma giant is snapping up tiny Mavupharma out of Seattle, a Frazier-backed startup that has its own unique take on STING — which is on the threshold of their first clinical trial.

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Hal Bar­ron's team at GSK scores a win with pos­i­tive Ze­ju­la PhI­II front­line study — now comes the hard part

Score one for Hal Barron and the new R&D team steering GlaxoSmithKline’s pipeline.

The pharma giant reported this morning that its recently acquired PARP, Zejula (niraparib), hit the primary endpoint on progression-free survival in a frontline maintenance setting for women suffering ovarian cancer — following chemo and regardless of their BRCA status.

GSK bet $5 billion on the Tesaro buyout primarily to get this drug, drawing the shaking heads of biopharma. Why pay a big premium for a drug like this when AstraZeneca was going from strength to strength with Lynparza, ran the argument, having won a hugely important accelerated approval to jump out ahead — way ahead — of the rest of the PARP players? Lynparza — now co-owned by a powerhouse cancer team at Merck — won the first approval in frontline maintenance in ovarian cancer.

Billing it­self as the first AI biotech to launch hu­man tri­als, Re­cur­sion adds $121M C round

Billing itself as the first AI biotech with programs in the clinic, Salt Lake City-based Recursion now has a $121 million bankroll to start gathering human data to see if it’s on the right track. 

“We’re trying to build this discovery engine,” Recursion CEO Chris Gibson tells me ahead of the C round news. “We now have the first two programs in the clinic.” And that, he adds, qualifies as a first for any AI establishment “that actually have something in the clinic.”

FDA bats back As­traZeneca's SGLT di­a­betes drug for Type 1 di­a­betes — block­ing a class on safe­ty fears

The FDA has just fired its latest salvo at the SGLT class of diabetes drugs, blowing up some commercial opportunity at AstraZeneca as part of the collateral damage.

The pharma giant reported early Monday that the FDA has rejected its blockbuster drug Farxiga for Type 1 diabetes that can’t be controlled by insulin. And while the pharma giant maintained its usual grim silence in the face of a setback, this one should be easy to interpret.