For Biogen's Spinraza launch, things are looking up on the coverage front: analyst

Most of the country's largest payers are covering Spinraza in SMA types 1 through 3.

It’s been just over six months since Biogen’s pricey spinal muscular atrophy medication, Spinraza, won FDA approval, and as far as coverage goes, things are looking better for the drugmaker than some expected.

Formulary coverage is “generally on the high side of what was expected,” Bernstein analyst Ronny Gal pointed out in a Wednesday note to clients. Among the 15 largest payers for which he and his fellow analysts could find policies, 11 cover the med in patients with SMA types 1 through 3, with just Humana and Blue Cross and Blue Shield of North Carolina restricting its use to type 1.

Only two of the plans Bernstein analysts reviewed bear age limits, with both mandating that patients be under 15 years old.

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It’s good news for Biogen, for which “the Spinraza launch and its long-term success is one of the critical debates,” Gal wrote. The company is counting on the pricey medicationwhose list price sits at $125,000 per injection, totaling $750,000 for the first year of treatment and $375,000 after thatto come up big in the face of multiple sclerosis struggles and the recent spinoff of its hemophilia business.

That’s not to say everything is going perfectly with the reimbursement process, though, Gal noted. Doctors he’s interviewed have pointed to challenges in intrathecal administration, a route of delivery into the spinal canal that requires two to three attending physiciansplus staffand starts at $10,000.

“Getting this process up to speed in hospitals and ensuring payment appears to be the current bottleneck,” he wrote, adding that “the challenges associated with intrathecal injection suggest more conversion long term toward gene therapy.”

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In SMA gene therapy, it’s not Biogen, but Illinois biotech AveXis that’s slated to come in first, but that’s not necessarily a big problem, Gal said. He expects AveXis’ product to launch with a sky-high sticker equivalent to three to seven years of Spinraza use, meaning payers could be tempted to “keep patients on Spinraza and wait” for Biogen’s gene therapy competitorexpected to enter the clinic early next year“to create a two way competition.”