|Sir Andrew Dillon--Courtesy of NICE|
Biogen Idec CEO George Scangos was quick to point out that approval in the EU this month for its hot-selling multiple sclerosis drug would not materialize into sales as fast there as it did in the U.S. That is because Tecfidera has to win reimbursement in individual countries where governments have gotten stingy about parting with healthcare dollars. A decision Thursday by U.K. price watchdog NICE is an indication of the cost hurdles to be faced.
NICE does not believe Tecfidera's cost, £16,000 ($26,680) a year, is an effective use of what money the National Health Service (NHS) has to spend. The decision is not final. The group has given Biogen Idec ($BIIB) until March 12 to provide additional information that might sway their call. NICE Chief Executive Sir Andrew Dillon still has questions: "[W]e want to ensure that we have as much information as possible to make an informed final recommendation," he said in a statement.
In the past, some drugmakers have returned with special price deals for NHS that have turned the tide. In fact, as PharmaTimes point out, NICE reversed first-round rejections on MS drugs Gilenya from Novartis ($NVS) and Aubagio from Sanofi ($SNY) when they came back with more data and deeper discounts.
Those two drugs got to market ahead of Tecfidera. Biogen had to sort out some patent issues in the EU. But if adoption of Biogen's drug in the U.S. is a barometer of what to expect in Europe, then it should give the competitors a difficult fight. Approved by the FDA in March 2013, Tecfidera has beaten analysts' estimates each quarter as it has grabbed market share. Late last month, the drugmaker reported that its profits were up 57%, leaping to $457.3 million, or $1.92 a share, with Tecfidera accounting for $398 million of the company's $1.97 billion in quarterly revenue. That trampled on analyst estimates of $346.5 million in sales for the popular pill.
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