As someone who has lived with spinal muscular atrophy for all 30 years of my life, I was perplexed and disappointed that the recent approval of Novartis’ gene therapy Zolgensma was immediately overshadowed by outrage over the drug’s price: $2.125 million.

The Food and Drug Administration’s decision was a pivotal day for those of us in the SMA community. Zolgensma, approved for children under 2, is the only one-dose treatment option for any category of SMA patients and has been highly effective in clinical testing so far.

Sure, it’s the world’s priciest drug. But instead of debating the level of financial profit that is appropriate for Novartis, let’s focus on the needs of patients. How are we going to get treatments for rare diseases if there’s not a financial incentive for doing it? Therapies are being developed because people think they can sell them for a profit. We don’t like to talk about it, but pharmaceutical companies exist to make money. Don’t we realize, though, that all of society profits from each disease we cure and each baby that is saved from SMA and other deadly diseases?

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As a professor of economics and finance, I believe that the cost-related complaints being thrown around social media are short-sighted. Shortly after Zolgensma’s price was announced, I even told a friend, “This is a good problem to have.” Why? It’s a twofold answer:

Competition. Zolgensma is the second treatment approved for SMA, following Biogen’s Spinraza. Now that there’s competition in the marketplace, that will lead to lower prices over the long term, especially if Zolgensma is approved for older SMA patients down the road. Roche currently has a daily pill called risdiplam for SMA in clinical trials. Should it also be approved, there will be further competition and downward pressure on prices for all three therapies.

Long-term value. The first two years of treatment with Spinraza cost around 50% of one Zolgensma infusion, but Spinraza treatments must continue for life at a cost of $375,000 each year. The four initial loading doses of Spinraza in the first year of treatment total $750,000. Over a 10-year period, the cost-effectiveness of Zolgensma is clear.

In terms of quality of life, one IV infusion of Zolgensma is definitely more palatable than multiple spinal infusions of Spinraza each year. I’m currently thrilled with the improvements in stamina and strength I’ve received from five doses of Spinraza. But I certainly wouldn’t miss the pain of having a needle inserted in my cervical spine every four months. (Due to my scoliosis, the less invasive, and less risky, lumbar puncture procedure isn’t possible. Other SMA patients have similar challenges.)

Critics of the eye-popping cost of Zolgensma need to take into account its long-term benefits. Zolgensma’s approval, and that of Spinraza, is the beginning of a new paradigm for treating SMA and for the fight against muscular dystrophy in general. Without any treatments, SMA would remain the top genetic killer of children under 2.

I’m not saying that cost is entirely irrelevant. I currently receive financial assistance through Biogen’s Spinraza copay assistance program. Biogen pays for any part of the drug and infusion procedure costs that my insurance company doesn’t cover (until I meet my $7,900 annual out-of-pocket maximum). In the end, though, I’m going to meet the annual out-of-pocket maximum no matter what due to other medical costs.

You might be skeptical of me saying $2.1 million isn’t too high a price while I receive help paying for Spinraza. A $2.1 million treatment for SMA, though, is no more ludicrous than paying more than $1,000 a month to rent a portable ventilator, especially when that one treatment will likely eliminate the need for the ventilator and many other costs associated with SMA care. I do hope Novartis will work with payers (public and private) as well as patients to maximize the number of children who receive Zolgensma.

We should not put a price tag on life, though. “$2.1 million is too much to spend for that baby’s survival” isn’t the kind of “value assessment” we should ever accept as a society. Instead, think about the parents who will no longer have to receive the heartbreaking news that my parents were given 29 years ago: “Your child has spinal muscular atrophy, and there’s nothing we can do. Survival beyond early childhood is unlikely.” The price of Zolgensma seems insignificant now, don’t you think?

Nathan Yates, M.S., is an adjunct economics and finance professor at Southern New Hampshire University and the founder of ForwardView Consulting.

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  • Two questions:

    1. Portugal I believe has a national insurance program, why wasn’t the drug paid for through them?

    2. Sounds like the family does not have insurance. In most situations, Novartis’ Patient Assistance Program (PAP) would have provided the drug for free. Did you contact Novartis?

    • Since my previous comment didn’t make the cut, I’ll just answer your questions:

      1- Portugal has a National Health System (NHS), not an insurance program. The drug wasn’t paid because the drug isn’t approved in the EU;

      2- In Portugal health insurance is not “mandatory” as you can access the NHS, and even if they had/have health insurance, it doesn’t matter because the drug isn’t approved in the EU. On the other hand, I seriously doubt Novartis would have provided the drug for free.

      If you don’t mind, just for transparency’s sake, could you please clarify your affinity with the pharmaceutical industry?

    • Thank you, Rui, for questioning Bob’s ties with pharma. His subsequent reply that this makes him a great expert who knows more than anyone here about the details of drug pricing (possibly true), ignores that PLENTY of knowledgeable people who know more than I do and who have written about drug pricing, e.g. Merrill Goozner or Stacie Dusetzina and MANY many others, do NOT believe the level of prices is justifiable. Even the pharma industry in a way acknowledges this when they sometimes turn to “value-based pricing” because in reality, if their books were opened, in most cases the prices nowadays CANNOT be justified by high research costs.

      Of course people need to be paid for their work but that is not what’s in question and Bob ignores the comments of a horrified researcher on this site. And most cancer doctors are horrified too.

      He’s not worth responding to – as he casts unwarranted aspersions on all who criticize pharma prices, but I did want to thank you for your valuable post that really contributes to the discussion, as well as for your questioning of him. Thanks, Rui.

  • Here in Portugal, we just raised 2 million for a new-born baby that needs this medication. It’s sad, that we have to go so far, for so much money to save a life. But thank god we, as a country, got together to help save this baby. I have high hopes that he will survive. High hopes

  • Tell me, Jo…..

    A drug that costs $1.5 billion in research and development, but only treats 1,000 patients….would do you think it should cost? Give me your expert opinion?

  • This is absolutely nuts.

    If the idea is that scientists need to be incentivized to cure diseases by heaps of profit, then you really don’t understand where a significant fraction of all cures and treatments come from, nor where ALL of the underlying basic research is done – academia.

    To simply assume the inevitability of the existence of the profit motive driving medical advances is either ignorant of alternative policies or deliberately misinforming readers. You should be ashamed of this awful take defending this most recent moral abomination.

    • No, not all of the basic research is done in academia. Not even close.

      You’re spouting misinformation which does not add to the conversation. The vast majority of treatments and cures are done by extremely dedicated clinicians and researchers at biopharmaceutical companies. These companies have to run efficient, cost effective research to survive. Federally funded academic research is a bottomless well of taxpayer money where there are great inefficiencies.

      So your post is naive at best, at worst, a conscious distortion of the truth.

    • Nathan is a wonderful individual who has overcame great obstacles despite a condition that most people couldn’t begin to deal with day in and day out. He has a wonderful sharp mind and I only wish he had the opportunity to have a body that matched. While it is an awful world we live in where human life comes with a price tag, the most simplest argument I have, would most of you go to work, if you were not paid to do so?

      Thanks,
      Dr. Amy Meade

  • I’m outraged reading this…. and definitely also do not agree with you – Novartis is not in financial trouble to survive. They’re not poor. They have in their hands a medicine that can save lifes. It is their ETHICAL duty to the World (the world, not only the US) to make the drug affordable as part of an income, it’s as simple as this. As simple as this. And affordable is so far from the current price that no 90% decrease would be enough. A FAIR price is needed. They will not get poor if they adjust and do the ethical thing. It’s more than outrageous. It’s unbelievable that in their website they try to justify “oh, we’re 50% cheaper than this or that” – well that just means the other ones are unethical too, that just means this ALL price issue needs to be fixed, not just them.
    Novartis will not get poor if this drug gets affordable. But on the other hand, all over the world, people will die (and are, currently, dying) because of them and of similar companies, lifes are being destroyed and people getting a lifetime debt / lifetime pain, and on other cases, major fundraising campaigns are being held….. and people are in fact fundraising to donate to….. Novartis!….. instead of donating to people and projects that really need it (because one can only have so much to donate, and there needs to be a choice, so this “donations” to poor Novartis are taking money away from those who really need it…). To read that there exists someone not in Novartis that supports this really shakes me to my core (the Novartis people that set the price, I don’t even have words for that lack of everything that’s decent in human behaviour). So sad to read this. In your case, one would expect you to be a force for solving this situation and getting the drug affordable worldwide to save lifes…. not the opposite….

  • I do not agree with you. Most people will never have access to this drug due to its cost. Most also do not have several thousand dollars available to burn on medical care. Pharmaceutical companies exorbitant profits and power over the US government are immoral. It seems that you are the one missing the point.

  • Isn’t it harder to know that there is a treatment available for your child, but you can’t do anything to get it?
    $2.1 million is an amount that only a few can spent, even for their child, and those are the millionaires. Or the state.
    As far as i know, medical insurance is not public in many countries in the world, and even if it is, it is not sure that the cost will be covered.
    Thus, many children will be left unhelpfull, even though a treatment is available.
    Isn’t this cruel?
    Really, I’m wondering what is the though behind this pricing. Who will pay such an amount of money? How the pharmaceuticals will earn money if no one can pay for it?
    Also, even if the market will regulate the prices of the drugs, how affordable could these be for everyone in need, considering that the starting price is $1 and 2$ millions?

    • The drug will be covered 90% of the time by a patient’s insurance paying only a monthly copay, the other 10% of the patients will be covered by an indigent patient assistance programs or given to the patient for free.

      Why is that so difficult to understand?

    • Insurance will pay for the treatment in almost all cases because it’s still cheaper than the alternative.

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