Health authorities in Britain ran cost-effectiveness numbers on pioneering CAR-T therapies that might be used to treat acute lymphoblastic leukemia in children, and payers may not want to hear the results.
A National Institute for Health and Care Excellence mock technology appraisal analysis—highlighted in a Thursday note from analysts at Jefferies—found that a $649,000 price tag on the therapies would be justified for young patients with acute lymphoblastic leukemia (ALL).
That doesn't mean Novartis, Kite and other CAR-T drugmakers will charge that much if and when their treatments get approved in ALL, or that payers would shell out even close to that amount. The Jefferies analysts say the $649,000 figure is likely the “upper bound” on the treatment from Kite, which is working toward a filing in non-Hodgkin lymphoma first. The analysts didn't discuss the other CAR-T companies in their note.
A Novartis spokesperson said "it is too early for us to comment on pricing; however, we will at the time of approval."
The Swiss drugmaker is "on track" to file with the FDA early this year in pediatric and young adult relapsed/refractory B-cell ALL, according to a company statement. The company anticipates filing its CAR-T drug with the FDA late this year for adults with diffuse large B-cell lymphoma and in Europe in late 2017 for both indications.
But the assessment does suggest the CAR-T developers would have a good case for a bigger-than-expected price, the Jefferies analysts said. They bumped their price estimate for Kite's Axi-Cell across all indications to $300,000 in the U.S., up from $200,000 previously. In Europe, they’re predicting an average sticker of $204,000, compared with a previous estimate of $125,000.
Their new price estimate notwithstanding, Jefferies analysts argued the NHS study has “limitations." They pointed out that it assumes value-based pricing and that it only looked at pediatric and young adult ALL patients. By including older patients, the study could have produced a lower reasonable price, they said.
Back in December, Novartis said 41 out of 50 pediatric and young adult patients with relapsed/refractory B-cell ALL saw complete remission—or complete remission with incomplete blood count recovery—from an interim analysis of a phase 2 trial.
On the same day, Kite reported that 9 out of 11 adult and pediatric ALL patients treated with its CAR-T med achieved those results in a preliminary analysis from a phase 1 study.
A “reasonable” price means a drug costs no more than £50,000 per additional quality-adjusted life year, according to the analysts' note. The NHS study assumed patients gain 11 QALYs on CAR-T treatment, and that they gain 10 over the current standard of care.
A $649,000 medicine wouldn’t be completely without precedent, however; Biogen recently launched its spinal muscular atrophy med Spinraza at a cost of $750,000 for the first year. That figure set off alarm bells in the payer industry, and the insurer Molina Healthcare recently warned the drug’s “inordinate cost” might take a bite out of its earnings.
The NHS report comes shortly after Kite said its candidate sustained efficacy for six months in a pivotal trial of patients with aggressive non-Hodgkin lymphoma; shares jumped 16% on the news. The company started a rolling approval application for Axi-Cel in December and hopes to have the filing complete by the end of the quarter.
NHS said it conducted the test to determine whether it should adjust its value review systems should be tweaked, but for now, it called existing methods "sufficient."