Sarepta to charge $300K for Duchenne drug. ‘We tried to be reasonable,’ CEO says

The newly approved Sarepta Therapeutics drug for Duchenne muscular dystrophy will cost about $300,000 a year for the average patient in the United States, which is less than what some Wall Street analysts had expected.

Sarepta CEO Dr. Edward Kaye said the pricing was “in the middle of the range” for rare disease drugs. “And given the sensitivity to pricing, we tried to be reasonable when looking at all the costs,” he said on a phone call Monday with securities analysts.

Pricing is, indeed, a sensitive topic. The cost of prescription drugs is now a potent source of outrage across the country as Americans respond to companies that buy old medicines and jack up prices, take hefty price hikes each year, and set higher floors for the cost of new and innovative treatments.

Rare disease drugs are defined as treatments for a disease with fewer than 200,000 patients in the US. The average annual cost per patient for such medications rose to $112,000 from $84,000 between 2010 and 2014, according to EvaluatePharma, a research firm.

Kaye argued that Sarepta attempted to address pricing concerns while setting the cost for the drug, which will be called Exondys 51. He cited, for instance, the research and development costs the company has so far incurred, as well as future costs for additional trials, some of which are required by regulators.

One advocate agreed. “Considering the cost of manufacturing, delivering, and supporting patients [with financial assistance programs], not to mention development costs over a decade, I don’t think it’s too much,” said Debra Miller of CureDuchenne, an advocacy group that also invests in drug makers.

The cost is comparable to a cystic fibrosis treatment sold by Vertex Pharmaceuticals, suggesting the price is not out of line, according to Dr. Walid Gellad, the codirector of the Center for Pharmaceutical Policy and Prescribing at the University of Pittsburgh.

However, Gellad also noted that Food and Drug Administration reviewers found the Sarepta drug did not demonstrate a clinically meaningful benefit for patients.

“Whether it’s $300,000 or $400,000, there are so few patients [with Duchenne] that payers will be able to pay,” he told us. “But what will they pay for?”

Sarepta executives would not disclose further details surrounding pricing, but did say that the cost will vary a bit depending upon patient weight and that payer reimbursement is expected to start kicking in somewhere between 30 and 90 days.

Meanwhile, Sarepta hopes to offset some costs with a priority review voucher it was awarded by the FDA as part of the approval. The company can use that to speed review of another drug, which can save time and potentially help generate revenue faster, or it can sell the voucher to another company.