When Johnson & Johnson made a pay-for-performance deal covering Velcade sales to the U.K.'s National Health Service, industry observers figured it was just a matter of time before other companies did the same. And sure enough, Novartis recently forged a cost-sharing deal to get its macular degeneration drug Lucentis onto the NHS formulary. Now, patient groups are lobbying Celgene to negotiate its own price-cutting scheme on the myeloma drug Revlimid.
The background: The National Institute of Health and Clinical Excellence deemed Revlimid unacceptable for NHS reimbursement, saying the drug isn't cost-effective. At $56,400 per year and an estimated three extra years of life, the cost blows past NICE's cost-effectiveness threshold. But patient advocates say Revlimid is a breakthrough that could help make myeloma into a manageable disease.
That's the same conclusion NICE reached on Velcade, before J&J pitched its pay-for-performance deal, under which the drugmaker refunds the cost on patients who don't respond. Whether Celgene plans to negotiate isn't yet clear, but you can count on more calls for discount deals as NICE continues its hard-line stand.