New Novartis Heart-Failure Drug Should Cost 17% Less, Research Group Says

By Peter Loftus 

Novartis AG's new heart-failure treatment should cost about 17% less than what Novartis is charging for it in the U.S. because expected wide use of the drug will strain health-care budgets, a nonprofit research group said Friday.

Entresto's U.S. list price, also known as its wholesale acquisition cost, is $12.50 a day, or about $4,560 a year per patient. Some analysts have estimated the drug could eventually generate more than $6 billion in annual global sales.

The Boston-based Institute for Clinical and Economic Review issued a report saying that Entresto's list price fairly reflects the clinical benefit it provides over older treatments for heart failure. But ICER also predicts that nearly two million U.S. patients could be prescribed the drug in its first five years on the market, which would create "a budget impact so high that excessive cost burdens would be placed on the overall health care system."

To curb that budget strain, ICER says Entresto should cost about $3,780 a year, or 17% less than the list price.

The U.S. Food and Drug Administration approved Entresto in July. A clinical trial showed it reduced the risk of death and hospitalization from heart failure versus another drug, enalapril. Side effects included low blood pressure and kidney impairment.

A Novartis spokesman declined immediate comment.

Novartis previously has said Entresto's price was in line with other new cardiovascular therapies. The company has said it is open to contracts with insurers and other health payers to link the drug's price to outcomes such as whether it reduces the rate of heart-failure hospitalizations among patients who take it.

ICER recently expanded its research into the cost-effectiveness of new drugs thanks to a $5.2 million grant from the Laura and John Arnold Foundation. ICER's reports have been drawing increasing attention. Some U.S. drug-plan managers credited the nonprofit last year with helping them secure big discounts on expensive new hepatitis C drugs, after ICER concluded the therapies would only be cost-effective at half their price.

Earlier this month, ICER said a new class of cholesterol-lowering injections should cost about 85% less than what is charged per patient for the treatments in the U.S., based on their clinical benefits.

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September 11, 2015 12:11 ET (16:11 GMT)

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