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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  • That price is ok for some one who has the means to be able to acquire the med but for the ones that can’t it is devastating. Most people cannot make $2.000.000 in a lifetime and pharmaceuticals are making millions all the time we are trying to raise enough for a little boy who is not quite two yet and it is a strain for that family to know it is available if they can acquire the money in time. We are praying they can make enough to get it in time.

  • Thanks, Mikel. That’s it in a nutshell. If the price were actually based on costs, that would be one thing. It is based instead on the maximum they believe they can extract from the system. Just like a kidnapper tries to figure out the maximum ransom someone can pay. It’s highway robbery, not recouping their costs including costs of drugs that don’t come to market and a decent profit (which people would not have a problem with). Yes, their rationalizations are a very bad joke.

    And all the money they suck out of the system – which we have to pay for either in premiums or taxes – is money not spent on other worthwhile things that also improve life for people.

  • 2 million is the price Novartis believes the system in the western world can pay. It is not based on the cost of production, commercialization or research.
    Considering they have been increasing sales double digits for the last 15 years, justifying the cost because of the development risk is an inmoral joke.

  • It is extremely significant to a wonderful couple and their 20 month old son when their insurance doesn’t cover it. They are trying to raise the money before he turns 2 in 4 months. I think it’s great to have somewhat of a cure, but if you can’t afford it and insurance doesn’t cover it- does it make those kids insignificant? Of course not. I can’t imagine being the parents and knowing there is a cure, but like most people, you don’t have $2 million to just pull out of the bank to help the person you’d give your life for. It’s a very sad situation.

  • ” The price of Zolgensma seems insignificant now, don’t you think? NO
    They should make a fair profit not rape people because it’s cheaper than the other treatment. They made the BILLONS back in a year or so on the new Hepc drug but after that they still put profits ahead of people. They should public shame the heads and familys of these drug companys day and night!
    Dont even get me started on the price of Insulin!

  • Re approval/pricing in EU. My understanding is that pharma companies must negotiate with the European Medicines Agency on pricing once a product is approved.

    And Bob is right that pharma companies’ Patient Access Programs really do help.

    One large Pharma (not Novartis nor Biogen) is considering/proposing that for their gene therapy products (when they get approved in the coming years) that patients/insurance wouldn’t pay until after treatment IF that treatment works (ie if the treatment didn’t work, patient doesn’t pay).

    Some people may not believe it, but many in pharma care about bringing life saving treatment to patients, and understand that access is part of that.

  • The price only seems insignificant if you can afford it.

    Otherwise the price is basically saying “We COULD save your child, but we won’t because you don’t make enough money. Only the rich people deserve their child to be saved.”

    Yes, it’s better to have a cure than not.

    No, it is not okay to price is thusly because “well the other drugs are expensive too.”

    How about we stop trying to maximize profit off human suffering?

    • So factually and “real world”, if 90% of the patients insurances are paying for the drug, and the other 10% get the drug for free, who’s “trying to maximize profit off human suffering?”

  • Bob wants to kid himself that high prices don’t hurt patients because yes some do get drugs for zero cost through patient assistance programs. But, they do hurt patients. https://oversight.house.gov/legislation/hearings/the-patient-perspective-the-devastating-impacts-of-skyrocketing-drug-prices-on As well, even if all persons actually got the drugs they need (and they don’t) without out-of-pocket costs, excessive prices hurt them through impact on wages and taxes.

  • Jo:

    “You really don’t get it Bob, do you? You have no moral compass at all, it’s just amazing.”

    When you resort to ad hominem attacks, and not to reason and facts, you’ve lost the argument.

    Re-read my other comments. I’ve got a long career of patient access to high priced, difficult to produce medications. ZERO patients of an approved drugs in the United States are denied due to financial situations. What about that do you find so difficult to understand?

    Are there acquisitions problems in other countries with unapproved drugs? Yes. But I highly recommend the patient groups for a disease state to lobby their various health ministries.

    And Jo, you should learn to bring facts, knowledge, and experience to a discussion. You don’t bring anything. Instead you just attack. So who has the lack of a moral compass?

    I’ve helped hundreds of doctors over the years get their patients high priced oncological meds for mostly a copay of $20-$50 a month. NEVER have I seen a patient denied therapy due to a financial situation.

    Yet….that fact and truth isn’t what you want to hear, is it Jo?

  • I’m not an expert on drug pricing, but Dr. Stacie Dusetzina is, and here are links to a lecture by her on the topic: https://soundcloud.com/plenarysession/202-bonus-improving-access-to-prescription-drugs-through-policy-change-with-dr-stacie-dusetzina
    and to an excellent interview (second half of this podcast) with her: https://soundcloud.com/plenarysession/167-monaleesa-7-and-the-cost-of-cancer-drugs-with-dr-stacie-dusetzina
    She talks about how high prices really DO limit drug access.

    • I’ve been in patient access for high end ontological TKI’S (tyrosine kinase inhibitors) for a long time and I’ve never seen one patient denied access to the drug due to economic/financial reasons. With companyPAP’s, copay assistance, etc. every patient gets the drug, zero denied.

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