'Tissue agnostic' cancer drug from Bayer, Loxo comes with high price, money-back guarantee

Bayer and development partner Loxo Oncology nabbed a groundbreaking nod for their “tissue agnostic” cancer drug Vitrakvi. Unlike traditional treatment, the first-in-class drug doesn’t target tumors in a particular location but cancers throughout the body that feature a specific biomarker.  

A year after Bayer bought into Loxo’s TRK inhibitor programs with $400 million upfront, Vitrakvi has secured an FDA nod to treat patients whose tumors feature a neurotrophic receptor tyrosine kinase gene fusion. 

The cutting-edge drug comes with a high price. The oral version costs $32,800 per month before discounts, according to an SEC filing from Loxo Oncology, or nearly $400,000 per year. To ease costs for patients and payers, Bayer unveiled two access programs, one of which refunds payment when patients don’t respond within 90 days. The other program provides reimbursement and patient assistance services. 

Despite the high price, Express Scripts Chief Medical Officer Steve Miller, who has often attacked high drug prices, praised Bayer's approach. He said in a statement that the benefits manager looks "forward to working together to help those who will benefit from this medicine have affordable access to it."

The companies face a particular challenge in launching the drug, because identifying eligible patients requires genetic testing that isn’t already routine. Leerink Partners analyst Andrew Berens, M.D., wrote that Bayer’s sales team will work with prescribing oncologists, while Loxo's staff will “focus on interfacing with lab directors and pathologists to raise awareness around tumor genomic profiling.” 

His team has projected peak sales of $700 million by 2030. EvaluatePharma, for its part, has pegged peak sales at $850 million; Oppenheimer analysts have estimated peak sales to reach $1 billion, according to Reuters. Berens wrote that next-gen TRK inhibitor LOXO-195 could bring another $375 million sales opportunity. The drug is “designed specifically to address resistance mutations that emerge” when patients use Vitrakvi, he wrote.

RELATED: Merck's Keytruda wins first FDA nod to treat genetically ID'd tumors anywhere in the body

Vitrakvi is the second drug to win an FDA nod based on cancer biomarkers rather than to fight individual cancers. In May 2017, Merck’s Keytruda won FDA approval to treat treat microsatellite instability-high cancer in any part of the body. 

In a statement, FDA Commissioner Scott Gottlieb, M.D., said the nod for Vitrakvi “marks another step in an important shift toward treating cancers based on their tumor genetics rather than their site of origin in the body. Its approval reflects advances in the use of biomarkers to guide drug development and the more targeted delivery of medicine. We now have the ability to make sure that the right patients get the right treatment at the right time.” 

RELATED: Bayer pays $400M upfront to buy into Loxo cancer drugs 

Bayer entered its TRK inhibitor partnership with Loxo last year with a $400 million upfront payment. The deal also features milestones and royalties, and could climb up to $1.55 billion in value. With the agreement, Bayer is in charge of global commercialization of the drug.

Last month, Bayer and Loxo posted updated data for the drug at the European Society for Medical Oncology meeting in Munich. The data set includes more than 100 patients ranging from 1 month to 80 years old across 24 tumor types. Previously, the drug achieved an objective response rate of 75% in a study of 55 patients with 17 types of TRK fusion-positive cancer.