Published: Fri, January 12, 2018
Business | By Max Garcia

Spark sets precedent with outcomes models, $850K gene therapy price tag

Spark sets precedent with outcomes models, $850K gene therapy price tag

Spark Therapeutics has set a wholesale acquisition cost of $425,000 per eye for its gene therapy Luxturna, a one-time treatment for a genetic condition that causes blindness.

Pricing it was entering a bit of a fearless new world: NBC News reports Luxturna is the first "true gene therapy" that's gotten the green light here for an inherited disease, and unlike other pharmaceutical companies' workhorses-drugs that patients take for weeks, months, or even a lifetime-Luxturna is expensive to create and delivered just once.

Despite Spark's efforts to offer alternative payment options (while still bringing in a profit), patient groups are already up in arms about the cost of Luxturna. It can improve the vision of those with a rare form of blindness that affects just a few thousand people in the U.S. Misa was 4-yearsold when he received his gene therapy treatment.

Consternation over skyrocketing drug prices, especially in the USA, has led to intense scrutiny from patients, Congress, insurers and hospitals.

Drug prices are not regulated in the USA, as they are in many other countries, so drugmakers can price their goods like any other manufacturer.

At the end of past year, the CEO of Spark Therapeutics, Jeffrey Marrazzo, said he thought the medicine price will be over 1 million United States dollars, but after insurers' responses, he cut it by 150,000 USD.

Luxturna is the first true gene therapy approved by the FDA for an inherited genetic disease.

Spark Therapeutics, the company that developed Luxturna, is working out a variety of slightly unconventional payment structures in light of Luxturna's price. For instance, Spark wants to offer discounts based on whether or not the drug initially works and remains effective; there are roughly 1,000 to 2,000 patients in the US who suffer from this kind of inherited retinal disease caused by a mutant gene.

Spark Therapeutics gained approval from the Food and Drug Administration in December for Luxturna (voretigene neparvovec), ahead of its February user fee action date.

However, on the same day as the pricing announcement, Marrazzo said in a statement that Spark would harness "the same level of innovation applied in development of the treatment to the delivery of, and access to, the treatment".

The company has opted for a slightly lower price of $425,000 per eye and has announced three programmes making the one shot per eye treatment more manageable for USA payers.

Alongside the pricing announcement for Luxturna, Spark also unveiled several different pricing programs created to help mitigate the burden on patients and payers.

The company said it had agreed bespoke deals with U.S. insurers, which cover the cost of most USA prescriptions, and they will get a refund if the drug doesn't work as expected. It says there is a pressing need to find ways to ensure these products will reach patients while ensuring industry gets a return on its investment in R&D.

"We are also eager to work with CMS to enable more meaningful rebates as part of the pay-for-performance model", Marrazzo said.

Marrazzo's not saying how much he's offering in rebates, but when I asked him why not a full refund for patients who don't respond adequately, he said that's not possible.

However, even though the cost is lower than the $1 million price tag that analysts were expecting, there remain concerns that the drug is overpriced.

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