Genentech/OSI Raise Tarceva Price 15% In Wake Of Iressa Failure
This article was originally published in The Pink Sheet Daily
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Genentech/OSI increased the price for the lung cancer therapy Tarceva by 15% on April 4, reflecting the epidermal growth factor receptor inhibitor's increased market presence after setbacks for AstraZeneca's Iressa . The average wholesale price for Tarceva (erlotinib) is $2,330 per 30-count bottle of 150 mg tablets, up from $2,026 for the same bottle. The companies originally bounded the price for the epidermal growth factor receptor inhibitor between AstraZeneca's EGFR agent Iressa(gefitinib) and Novartis' Gleevec (imatinib) (1 (Also see "Tarceva Price Will Be Bounded By Iressa And Gleevec, OSI Says" - Pink Sheet, 11 Aug, 2004.)). Iressa's current wholesale acquisition cost is $1,702.88 for a 30-count bottle of 250 mg tablets. Gleevec's AWP is $2,837.51 for a 30-count bottle of 400 mg tablets, according to Medi-Span's Feb. 15 issue of Price Alert. The premium price for Tarceva is justified in part by Iressa's failure to show a survival benefit in a confirmatory trial (2 (Also see "Iressa Promotion Halted; AstraZeneca To Highlight Tarceva Survival Benefit" - Pink Sheet, 17 Dec, 2004.)). Following the announcement of the Iressa Survival Evaluation in Lung cancer trial failure, AstraZeneca began informing physicians of Tarceva's survival benefit. In March, FDA's Oncologic Drugs Advisory Committee voted that physicians had been adequately informed of the trial failure and chose to forgo a discussion on whether a recommendation for Tarceva as first-line therapy should be incorporated into Iressa labeling (3 (Also see "Iressa Survival Data Adequately Disseminated To Physicians/Patients, Cmte. Says" - Pink Sheet, 4 Mar, 2005.)). Iressa has remained on the market pending submission of the final ISEL data set in June, which will be followed by an FDA determination on the future of the product. First quarter Tarceva sales show the added boost from AstraZeneca's detailing. Sales from its Nov. 18, 2004 approval to year-end totaled $13.3 mil., while sales for the first quarter of 2005 reached $47.6 mil. "Sales were driven primarily by rapid growth in patient market share," Genentech Senior VP/General Manager-BioOncology Ian Clark said during the company's April 11 earnings call. Based on Verispan data, "Tarceva's share of the new oral EGFR-treated patients reached 90% in Q1 2005." The reaction from Wall Street showed that investors had been unsatisfied with Tarceva's initial price. OSI's share price fell 28% between approval in mid-November and Dec. 1; Genentech shares fell 3% during the same period. - John Rancourt |