Novartis' Zolgensma Approved for Sale in U.S. to Treat SMA in Infants at $2.125 Million, Payable Over 5 Years -- Update

By Maria Armental

Novartis AG's gene therapy to treat a rare muscle-wasting disease that typically kills babies before age 2 was approved for sale in the U.S., setting off a potentially fierce and costly competition.

Zolgensma, a one-time injection to treat spinal muscular atrophy in children younger than 2, comes with a record price of $2.125 million -- slightly above analysts' projections.

Novartis -- which added Zolgensma when it bought AveXis Inc. last year for $8.7 billion -- said it would offer the option to pay the cost over a period of up to five years.

"We are offering a pay-over-time model for this one-time treatment to accommodate the current structure of the U.S. healthcare system and we have also established outcomes-based agreements with payers because we believe in the long-term value of Zolgensma and are willing to stand behind the therapy," AveXis President Dave Lennon said in a statement.

The Institute for Clinical and Economic Review, an independent nonprofit that had concluded that Zolgensma should cost no more than $1.5 million, on Friday endorsed the price.

"Zolgensma is dramatically transforming the lives of families affected by this devastating disease, and given the new efficacy data for the presymptomatic population, the price announced today falls within the upper bound of ICER's value-based price benchmark range," Dr. Steven D. Pearson, the president of ICER, said in a statement. "Insurers were going to cover Zolgensma no matter the price."

ICER's updated value-based price benchmark for Zolgensma assumes that the treatment's effectiveness will be long lasting, and that the US widely and rapidly adopts the recommendation to add screening for SMA to routine newborn screening.

Zolgensma will compete with Biogen Inc.'s Spinraza, a life-long treatment that requires an injection every four months.

Spinraza, until now the only approved treatment in the U.S. for children and adults, is priced at $750,000 for the first year and $375,000 a year after that.

SMA, as the hereditary disease is known for its acronym, is the leading cause of infant deaths.

There are four primary types of SMA based on age when symptoms first appear and highest milestone achieved. Many children with SMA type 1, a severe form and most common type, don't survive past the age of 2.

Write to Maria Armental at [e-mail]

(END) Dow Jones Newswires

May 24, 2019 14:25 ET (18:25 GMT)

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