To be cost-ef­fec­tive, Bio­gen should slash Spin­raza price, and No­var­tis can­not jus­ti­fy a $4M-$5M price tag for Zol­gens­ma — ICER

As treat­ments for rare dis­eases and gene ther­a­pies make strides on the US mar­ket, the is­sue of pric­ing is once again cen­ter stage. Bio­gen should cut the price of its spinal mus­cu­lar at­ro­phy (SMA) treat­ment Spin­raza and the price for No­var­tis’ one-shot Zol­gens­ma — which is ex­pect­ed to win FDA ap­proval by May — is jus­ti­fi­able up to $1.5 mil­lion, Boston-based ICER con­clud­ed on Wednes­day.

Akin to NICE in the UK, ICER is an in­de­pen­dent body that an­a­lyzes the cost-ef­fec­tive­ness of drugs and oth­er med­ical ser­vices in the Unit­ed States. Un­like NICE, though, ICER is not gov­ern­ment-af­fil­i­at­ed, but its de­ter­mi­na­tions are in­creas­ing­ly be­com­ing in­flu­en­tial with pay­ers.

Spin­raza was ap­proved by the FDA amidst much fan­fare in 2016 as the first and on­ly dis­ease-mod­i­fy­ing treat­ment for SMA, a rare and but lead­ing ge­net­ic cause of in­fant deaths. But the price tag of $750,000 for the first year of ther­a­py (and a $375,000 there­after) sparked heavy crit­i­cism, even though many pay­ers even­tu­al­ly agreed to re­im­burse the treat­ment. It gen­er­at­ed $1.7 bil­lion in 2018 sales for Bio­gen.

No­var­tis’ Zol­gens­ma is cur­rent­ly un­der FDA re­view and the agency is ex­pect­ed to an­nounce its de­ci­sion in the com­ing months. The Swiss drug­mak­er has sug­gest­ed a price of $4 mil­lion for the gene re­place­ment ther­a­py, which it ac­quired via its $8.7 bil­lion takeover of AveX­is, may be jus­ti­fied.

David Rind

“(T)he cur­rent price of Spin­raza far ex­ceeds com­mon thresh­olds for cost-ef­fec­tive­ness. The price of Zol­gens­ma is not yet known, but there has been pub­lic dis­cus­sion of prices above com­mon­ly ac­cept­ed cost-ef­fec­tive­ness thresh­olds as well. These treat­ments will be cov­ered by US in­sur­ers re­gard­less of the pric­ing, but the rip­ple ef­fect of pric­ing de­ci­sions like these threat­ens the over­all af­ford­abil­i­ty and sus­tain­abil­i­ty of the US health sys­tem,” ICER’s chief med­ical of­fi­cer David Rind said in a state­ment.

In the ini­tial draft ICER rec­om­men­da­tions is­sued late last year, ICER had sug­gest­ed Zol­gens­ma — priced at $2 mil­lion — could be more cost-ef­fec­tive in the long run ver­sus Spin­raza.

On Wednes­day, ICER’s fi­nal re­port sug­gest­ed al­though Spin­raza’s price “should be far low­er than it is, and the price for Zol­gens­ma should be low­er than the hy­po­thet­i­cal $4-5 mil­lion price the man­u­fac­tur­er has sug­gest­ed could be jus­ti­fied.”

ICER con­duct­ed its analy­ses us­ing two mea­sures: 1) QALYs, or qual­i­ty-ad­just­ed life-years, are a mea­sure of the state of health of a per­son or group in which the ben­e­fits — in terms of length of life — are ad­just­ed to re­flect the qual­i­ty of life. Es­sen­tial­ly, one QALY is equal to one year of life in per­fect health. 2) Life years gained (LYG), which ex­press­es the ad­di­tion­al num­ber of years of life that a per­son lives as a re­sult of re­ceiv­ing a treat­ment.

His­tor­i­cal­ly, life ex­pectan­cy in the most com­mon and se­vere form of SMA (type I) is less than two years. Sur­vival de­pends on res­pi­ra­to­ry func­tion, and many in­fants and chil­dren even­tu­al­ly re­quire per­ma­nent ven­ti­la­tion.

Us­ing the QALY mea­sure for cost-ef­fec­tive­ness, Spin­raza’s val­ue was as­sessed in the presymp­to­matic pop­u­la­tion, as there are da­ta sup­port­ing its ef­fec­tive­ness in these types of pa­tients. The drug’s price should be be­tween $72,000-$130,000 for the first year of treat­ment and be­tween $36,000-$65,000 for each suc­ces­sive year. Un­der the LYG bench­mark, Spin­raza would need to be priced be­tween $83,000-$145,000 dur­ing the ini­tial year and $41,000-$72,000 for each suc­ces­sive year, ICER said.

“As the re­port notes, there is a sig­nif­i­cant dif­fer­ence in ro­bust­ness and qual­i­ty of ev­i­dence for Spin­raza as com­pared to Zol­gens­ma. The analy­sis, how­ev­er, fails to ac­count for those dif­fer­ences. Spin­raza is the stan­dard of care in SMA and has ben­e­fit­ted the lives of more than 6,600 peo­ple. In con­trast, Zol­gens­ma is an ex­per­i­men­tal ther­a­py which has re­port­ed re­sults to date for on­ly 15 pa­tients fol­lowed for up to 2.5 years, sev­en of whom are re­port­ed to have sub­se­quent­ly ini­ti­at­ed treat­ment with Spin­raza,” a Bio­gen spokesper­son said in an emailed state­ment.

Mean­while, ICER did not vote on the long-term val­ue of Zol­gens­ma, as its fi­nal price is not yet known. It con­duct­ed its as­sess­ment for the SMA type I pop­u­la­tion as this is the on­ly pop­u­la­tion in which it has been clin­i­cal­ly eval­u­at­ed. Us­ing QALY, the ther­a­py’s price for type I SMA would need to be be­tween $310,000-$900,000 per shot, while un­der the LYG bench­mark it would need to be be­tween $710,000-$1.5 mil­lion per treat­ment, ICER con­clud­ed.

“The val­ue mea­sures and thresh­olds em­ployed by ICER in this re­port are de­signed around the sta­tus quo of chron­ic care man­age­ment and can­not pos­si­bly cap­ture the full ben­e­fits of dis­ease-mod­i­fy­ing treat­ments de­liv­ered as a one-time ad­min­is­tra­tion,” a No­var­tis spokesper­son said in an emailed state­ment.

ICER al­so rec­om­mend­ed pay­ers en­dorsed the con­cept of val­ue-based con­tracts, a sys­tem in which a re­im­burse­ment for a sub­stan­tial por­tion of the treat­ment is not passed on to the drug­mak­er, should pa­tients not re­ceive ad­e­quate clin­i­cal ben­e­fit.


Im­age: Shut­ter­stock

Hal Barron and Rick Klausner (GSK, Lyell)

Ex­clu­sive: GSK’s Hal Bar­ron al­lies with Rick Klaus­ner’s $600M cell ther­a­py start­up, look­ing to break new ground blitz­ing sol­id tu­mors

LONDON — Chances are, you’ve heard little or nothing about Rick Klausner’s startup Lyell. But that ends now.

Klausner, the former head of the National Cancer Institute, former executive director for global health at the Gates Foundation, co-founder at Juno and one of the leaders in the booming cell therapy field, has brought together one of the most prominent teams of scientists tackling cell therapy 2.0 — highlighted by a quest to bridge a daunting tech gap that separates some profound advances in blood cancers with solid tumors. And today he’s officially adding Hal Barron and GlaxoSmithKline as a major league collaborator which is pitching in a large portion of the $600 million he’s raised in the past year to make that vision a reality.

“We’ve being staying stealth,” Klausner tells me, then adding with a chuckle: “and going back to stealth after this.”

“Cell therapy has a lot of challenges,” notes Barron, the R&D chief at GSK, ticking off the resistance put up by solid tumors to cell therapies, the vein-to-vein time involved in taking immune cells out of patients, engineering them to attack cancer cells, and getting them back in, and more. “Over the years Rick and I talked about how it would be wonderful to take that on as a mission.”

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First place fin­ish: Eli Lil­ly just moved to fran­chise leader with their sec­ond mi­graine drug OK in 1 year

In a rare twist for Eli Lilly’s historically slow-moving R&D group, the pharma giant has seized bragging rights to a first-in-class new drug approval. And all signs point to an aggressive marketing followup as they look to outclass some major franchise rivals hobbled by internal dissension.

The FDA came through with an OK for lasmiditan on Friday evening, branding it as Reyvow and lining it up — once a substance classification comes through from the DEA — for a major market release. The oral drug binds to 5-HT1F receptors and is designed to stop an acute migraine after it starts. That makes it a complementary therapy to their CGRP drug Emgality, which has a statistically significant impact on preventing attacks.

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Allogene HQ Open House on September 17, 2019 in South San Francisco. (Jeff Rumans, Endpoints News)

The next 10 years: Where is biotech head­ed?

The last 10 years have seen a revolution in drug development. Timelines have shortened, particularly in oncology. Regulators have opened up. Investment has skyrocketed. China became a player. Biotechs have multiplied as gene and cell therapy has exploded — offering major new advances in the way diseases are treated, and sometimes cured.

So where are we headed from here? I journeyed out to San Francisco in September to discuss the answer to that question at Allogene’s open house. If the last 10 years have been an eye-opener, what does the next decade hold in store?

Patrick Mahaffy, Getty Images

Court green-lights Clo­vis case af­ter de­tail­ing ev­i­dence the board ‘ig­nored red flags’ on false safe­ty and ef­fi­ca­cy da­ta

Clovis investors have cleared a major hurdle in their long-running case against the board of directors, with a Delaware court making a rare finding that they had a strong enough case against the board to proceed with the action.

In a detailed ruling at the beginning of the month that’s been getting careful scrutiny at firms specializing in biotech and corporate governance, the Delaware Court of Chancery found that the attorneys for the investors had made a careful case that the board — a collection of experts that includes high-profile biotech entrepreneurs, a Harvard professor and well-known investigator as well as Clovis CEO Patrick Mahaffy — repeatedly ignored obvious warnings that Mahaffy’s executive crew was touting inflated, unconfirmed data for their big drug Roci. Serious safety issues were also reportedly overlooked while the company continued a fundraising campaign that brought in more than a half-billion dollars. And that leaves the board open to claims related to their role in the fiasco.

The bottom line:

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Bill Gates backs Gink­go Biowork­s' $350M raise to fu­el the buzzy syn­thet­ic bi­ol­o­gy 'rev­o­lu­tion'

If you want to understand Ginkgo Bioworks, the name should suffice: Bioworks, a spin off “ironworks,” that old industrial linchpin devoted to leveraging scale as a wellspring for vast new industries capable of remaking society. Ginkgo wants to be the ironworks for the revolution it’s heralded with as much fanfare as they can, playing off of one of the buzziest technologies in biotech.

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UCB bags a ri­val to Soliris in $2.1B buy­out deal — but will an in­creas­ing­ly vig­i­lant FTC sign off?

UCB is buying out Ra Pharma $RARX, announcing an acquisition deal that rings up at $48 a share, or $2.1 billion net of cash, and puts them toe-to-toe with Alexion on a clinical showdown.

Ra shares closed at $22.70 on Wednesday.

There’s a small pipeline in play at Ra, but UCB is going for the lead drug — a C5 inhibitor called zilucoplan in Phase III for myasthenia gravis (MG) looking to play rival to Alexion’s Soliris. Soliris has the market advantage, though, with a much earlier approval in MG in late 2017 that UCB feels confident in challenging.

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A new play­er is tak­ing the field in a push for a he­mo­phil­ia A gene ther­a­py, and it’s a big one

BioMarin, the execs at Spark (and buyer-to-be Roche) as well as the Sangamo/Pfizer team have a new rival striding onto the hemophilia block. And it’s a big one.

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Stuck with a PhI­II gene ther­a­py fail­ure at 96 weeks, Gen­Sight prefers the up­beat as­sess­ment

Two years after treatment, the best thing that GenSight Biologics $SIGHT can say about their gene therapy for vision-destroying cases of Leber Hereditary Optic Neuropathy is that it’s just a bit better than a placebo — just maybe because one treatment can cover both eyes.

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George Scangos / Credit: Cornell University

ARCH, Soft­Bank-backed Vir Biotech­nol­o­gy un­der­whelms with $143 mil­lion IPO

George Scangos went back to Wall Street, and came back 700 million pennies short.

Scangos’ vaunted startup Vir Biotechnology raised $143 million in an IPO they hoped would earn $150 million. Shares were priced at $20, the low-end of the $20-$22 target.

Launched with backing from ARCH Venture’s Robert Nelsen, Masayoshi Son’s SoftBank Vision Fund, and the Bill & Melinda Gates Foundation, the infectious disease startup was one of a new wave of well-resourced biotechs that emerged with deep enough coffers to pursue a full R&D line rather than slowly build their case by picking off a single lead program.