A day after the FDA's landmark decision to grant accelerated approval to Biogen's Alzheimer's disease drug Aduhelm (aducanumab), company executives on Tuesday were asked to explain why they set an annual price tag of roughly $56,000 for the anti-amyloid antibody. The treatment's wholesale acquisition cost is higher than the $10,000 to $25,000 price some analysts were expecting, and the drug was approved amid fierce debate over whether it offers any clinical benefit.
The agency approved Aduhelm with a broad label based on the surrogate endpoint of reducing amyloid plaque in the brain, which it said "is reasonably likely to result in clinical benefit." The drug's development programme included two Phase III studies that produced conflicting results, and which many, including most members of an FDA advisory panel convened last year, have said ultimately failed to demonstrate effectiveness.
"Our one concern here comes around the [Aduhelm] annual cost, and whether at $56,000/year, the sticker shock could further invigorate scrutiny on drug pricing," said Stifel analyst Jeff Preis, who had estimated a price of around $10,000 annually. In a similar vein, J.P. Morgan analyst Cory Kasimov wondered how concerned Biogen executives are about "backlash" the industry will face over its pricing. Some of that may be starting, with Ron Wyden, chairman of the US Senate finance committee, tweeting on Tuesday that "it's unconscionable to ask seniors and taxpayers to pay $56,000 a year for a drug that has yet to be proven effective. Medicare must be able to negotiate a fair price for prescription drugs."
Meanwhile, Bank of America analyst Geoff Meacham, who thought the FDA was unlikely to approve Aduhelm, conceded "our prior view was not correct – the accelerated approval…was a surprise to us, not the least of which reflects the generally open label, which doesn't restrict access to patient subtypes." However, he predicts the treatment "is likely to disappoint commercially given confusion over the benefit and payer pushback." The analyst said "the debate now shifts to launch, payer roadblocks, and whether near-term competition can emerge from Eli Lilly and others with plaque-reducing agents."
Meanwhile, Biogen said it has "significant inventory" on hand to supply the launch and it expects to begin shipping Aduhelm in about two weeks. It has also prepared more than 900 healthcare centres in the US for the intravenous infusion treatment. Chief financial officer Michael McDonnell said the need for PET scans or cerebrospinal fluid tests, as well as the limited availability of specialists to oversee patients taking the drug, could limit Aduhelm's use. "We believe the majority of diagnosed patients are not currently under the care of a specialist, and as a result we expect gradual uptake over time," he added.
Biogen still forecasts overall group sales of between $10.45 billion and $10.75 billion this year, on the assumption that Aduhelm's contribution will be "modest" in 2021, but with the drug "ramping to a multibillion-dollar US sales opportunity over the next several years." Guggenheim analysts estimate that the treatment could bring in over $1.3 billion in 2022.
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