Gene Therapy Gets FDA Approval -- And a $2 Million Price Tag

(CNN)The US Food and Drug Administration approved a treatment Friday for a genetic disease called spinal muscular atrophy that causes infants' muscles to waste away, potentially killing them before age 2.




And then came the price tag: $2.125 million for a one-time treatment.
The gene therapy, called Zolgensma, will be marketed by AveXis, whose parent company is Novartis.

"Today's approval marks another milestone in the transformational power of gene and cell therapies to treat a wide range of diseases," Dr. Ned Sharpless, the FDA's acting commissioner, said in a statement Friday. "The potential for gene therapy products to change the lives of those patients who may have faced a terminal condition, or worse, death, provides hope for the future."
The list price, which was anticipated to be in the low millions, immediately reignited controversy around the rising costs of drugs and how to pay for them.
"It is emblematic of our broken system that effectively forces us to pay whatever price drug corporations demand for lifesaving new drugs," David Mitchell, founder of the advocacy group Patients For Affordable Drugs, said in a statement Friday.

Novartis leaders said Friday that the price met their targets of cost-effectiveness, with the newly approved treatment costing about half of what another treatment for the disorder, Spinraza, might cost over 10 years. They said that the company will have patient support and payment programs in place and that they do not expect out-of-pocket costs to be prohibitive for patients who need the treatment.
"We didn't pay for the polio vaccine based on the future cost savings for kids who didn't need to live in iron lungs," Mitchell said in criticizing the pricing decision.

The chief clinical officer of Cigna Corp. said in a statement that the health insurer anticipated "continuing the work we have started with AveXis to find unique solutions like installment payments and outcomes-based agreements for these life changing gene therapies."

Spinal muscular atrophy is an inherited disorder stemming from a defective gene that leads to the death of nerve cells responsible for moving muscles that allow us to walk, talk, breathe and swallow, according to the National Institute of Neurological Disorders and Stroke. Zolgensma replaces a working copy of that gene into those nerve cells before they die and symptoms develop.

As many as 1 in 8,000 babies is estimated to be affected by one of the genetic mutations that causes it. That includes about 450 to 500 infants in the United States per year, according to a Novartis statement.
Sharpless said Friday that the agency plans to help speed up the pace of reviewing products that address unmet medical needs and bringing them to the market.
In January, FDA leaders said they expect that the agency will be approving 10 to 20 cell and gene therapy products yearly by 2025.

In a CNBC op-ed last week, Novartis CEO Dr. Vas Narasimhan called for a new pricing and payment model for one-time treatments like Zolgensma, versus other treatments with costs that accumulate over time.
"Health-care systems, however, are accustomed to treating chronic diseases with a pay-as-you-go model, spreading costs over months and years," Narasimhan said. "They are currently unprepared to pay for a surge of new, single-treatment therapies with the potential to provide a lifetime of benefit."
But Mitchell, a cancer patient himself, said the company was abusing a broken system, "forcing families to answer one question: 'What are you willing to pay to save your child's life?' "

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