Tysabri To Be Priced 20% Higher Than When Initially Launched
This article was originally published in The Pink Sheet Daily
Executive Summary
Biogen CFO predicts favorable reimbursement for natalizumab, minimizing cost for most patients.
|
Biogen Idec/Elan's Tysabri (natalizumab) will be priced 20.8% higher when it returns to the market in July than when it was first approved in November 2004, according to information on Elan's website. The multiple sclerosis treatment will have a wholesale acquisition cost of $2,184.62 per vial, compared to $1,808 in 2004. The drug is given by injection once a month. Speaking at the Goldman Sachs Global Healthcare Conference June 14, Biogen CFO Peter Kellogg explained that the higher cost was justified due to the 12-year development of the product, as well as the additional expense associated with crafting a risk management plan. A requirement of Tysabri's return to the market is contingent on the firm's restrictive TOUCH plan, which is intended to manage the risk for progressive multifocal leukoencephalopathy, three cases of which led to the withdrawal of the product in February 2005 (1 (Also see "FDA Re-Approves Tysabri, Recommends Second-Line Use" - Pink Sheet, 5 Jun, 2006.)). "We think that MS is a very serious disease. It's a specialty market, if you will, and one with very high unmet need," Kellogg said. "I think the payers are very aware of that and will act accordingly." When asked during a June 6 analyst call about Tysabri's price, Elan CEO Kelly Martin emphasized the drug's increased efficacy and expanded indication. The drug is now also indicated to delay the accumulation of physical disability and its label leaves open the possibility of first-line treatment. The additional cost associated with running the risk management program as possibly being reflected in a higher price was mentioned by Biogen Exec VP-Development Burt Adelman. Despite the elevated price, Kellogg was optimistic regarding Tysabri's reimbursement outlook, noting that roughly 75% of MS patients are in the private pay reimbursement setting and two-thirds of those patients have co-pays. "The typical co-pay in the MS community is a monthly payment cycle, which is very reasonable," he said. "It's a range of outcomes, but it tends to be something like $30, $35 a month. For those who have a co-insurance...often those are capped by the payers." "We don't anticipate large barriers, be we do anticipate having to work with all the reimbursement groups over the launch period and the first six to nine months to get that all ironed out," he added. Kellogg also said he does not expect Tysabri's use as a first- or second-line therapy to affect reimbursement. "We haven't seen that kind of behavior in the MS market before and, again, I'd remind you the FDA label said 'generally recommended,'" as a second-line therapy, he said. "They were very specific to say that that did not mean it is restrictive." - Jonathan Block |