4. Zynteglo

Bluebird Bio CEO snares $24 million pay package as gene therapy advance
Bluebird has yet to announce a U.S. price for Zynteglo, but in an investor presentation in early June, it unveiled the sticker in Europe: €1.575 million ($1.77 million) spread over five years. (Bluebird Bio)

Generic name: N/A
Company: Bluebird Bio
Disease: beta thalassemia
2024 sales estimate: $1.87 billion

Instead of directly elevating levels of hemoglobin to treat patients with beta thalassemia, Bluebird Bio’s Zynteglo is designed to deal with the underlying genetic cause of the inherited blood disorder. But as with any gene therapy that aims to cure a complex disease with a single infusion, pricing and access pose major challenges.

Bluebird Bio has been working upfront to address these challenges. In his presentation at the J.P. Morgan Healthcare Conference in January, CEO Nick Leschly laid out plans that would allow insurers to pay for Zynteglo over a period of five years. After the first payment, Bluebird would only charge for Zynteglo if it continues to work for patients. This means “putting up to 80% of our price at risk based on success,” Leschly said.

RELATED: Bluebird prices gene therapy Zynteglo at €1.575M in Europe, to be paid over 5 years

The biotech has yet to announce a U.S. price, but in an investor presentation in early June, it unveiled the sticker in Europe: €1.575 million ($1.77 million) spread over five years. The drug won EU approval in transfusion-dependent beta thalassemia (TDT) on June 3. Bluebird has been quoting the “intrinsic value” of Zynteglo—including its impact on patient quality of life and survival, but no healthcare costs it prevents—at $2.1 million. 

In a June 14 note to clients, Evercore ISI analyst Josh Schimmer called the price “responsible.” But in Mani Foroohar's report on the same day, the SVB Leerink analyst noted that the price almost doubled his previous estimate of $900,000 in Europe, though it's “potentially offset by proposed value-based annuity payment structure.” For the U.S., Foroohar previously projected a price of $1.2 million. Moreover, unlike Novartis' $2.125 million (U.S. price) gene therapy Zolgensma that requires a simple intravenous infusion, “Zynteglo is a transplant medicine product with substantial additional expense for the healthcare system,” Foroohar said.

Zynteglo ranks as Bluebird’s first commercial product, and as a novel therapy, a lot needs to be done before the final rollout. With the conditional nod in hand, the company is still working with the EMA “to finalize and narrow our drug specification and our commercial drug manufacturing process,” Bluebird's chief commercial officer, Alison Finger, told investors during a briefing. The company expects to enroll patients to its qualified treatment centers by the end of this year and to treat the first commercial patient in early 2020, she said.

Straightening out everything before the launch could be a better strategy for Bluebird—just consider how an FDA specification adjustment is costing Novartis a slow launch of cell therapy Kymriah. But as Foroohar noted, “whether the ultimate commercial product will live up to the clinical data seen to date is unclear due to necessary manufacturing changes.” 

An FDA decision is expected by early 2020, and in the meantime, Bluebird has been racking up new numbers to back up its efficacy. At the American Society of Hematology Annual Meeting and Exposition in December, Bluebird reported that eight of 10 TDT patients treated with Zynteglo in the phase 1/2 NorthStar trial went without a transfusion for at least a year. Two patients needed no transfusions for more than three and a half years.

Bluebird has broader hopes for Zynteglo, too. It focused on TDT patients for its first regulatory approvals, but it's also testing the drug in sickle cell disease.

4. Zynteglo