FDA OKs Vertex Drug For Cystic Fibrosis; $294K/Yr
17 CommentsBy Ed Silverman // January 31st, 2012 // 12:13 pm
In a surprise move, the FDA has approved a breakthrough drug from Vertex Pharmaceuticals for cystic fibrosis more than two months ahead of the scheduled PDUFA review deadline, a point that the agency emphasized in announcing the endorsement. The House Energy & Commerce Committee, by the way, holds a hearing tomorrow on the virtues of the Prescription Drug User Fee Act (see here).
The approval, itself, is not a surprise, but the added time to market the drug, which is called Kalydeco, is expect to be a boon for Vertex. The drugmaker, which last year gained notice after the FDA okayed its Hepatitis C treatment, is pricing the drug at $294,000 annually will announce pricing momentarily, but ISI Group biotech analyst Mark Schoenebaum suggests the drug could cost about $250,000 per patient annually. Shipments to pharmacies will begin this week, according to Vertex (read the statement).
The market, however, is actually small. Kalydeco is the first and only drug to fix an underlying genetic cause of cystic fibrosis in people with a specific protein mutation, known as G551D. But the treatment is only effective in about 4 percent of the estimated 30,000 cystic fibrosis patients with that mutation, or 1,200 people (here is the label). As a result, the FDA granted Kalydeco orphan status. Although, Schoenebaum believes up to 80 percent of this group will be treated with the drug and estimates peak global sales of $583 million.
“Kalydeco is an excellent example of the promise of personalized medicine – targeted drugs that treat patients with a specific genetic makeup,” FDA Commish Margaret Hamburg says in a statement. “The unique and mutually beneficial partnership that led to the approval of Kalydeco serves as a great model for what companies and patient groups can achieve if they collaborate on drug development.”
Going forward, Schoenebaum believes that Kalydeco will eventually win approval for patients with other, but related mutations, which would increase the eligible patient popuation to about 6 percent of the universe. “Of course, the super-upside scenario depends on the ‘combo’ trial that’s ongoing now, which could open up about 50 percent of the CF population,” he writes to investors.
John
Medicine is for the people, not for the profits…
Mike
Great job John … you must be a Merck alum to reference George Merck’s quote.
Medicine IS for the people … what you also fail to mention in your short blurb is bringing medicine to the people is a costly endeavor. The cost of clinical trials, pipeline development, failed drugs, promotion and education, etc is a tremendous cost and risk to those companies that bring medicine to the people. Considering the cost of development of this CF drug and the patient population it sserves, the cost, while exhorbitant, is justifable to the market needs and market conditions. Lastly, Vertex is a public company … and as such, it’s responsibilities are not only to the patients, but also the shareholders … and thus the profits must at all times be considered.
Kimberly
I would imagine there is a comparison that details the cost benefits of treating with Kalydeco. CF is an expensive disease to treat and if Kalydeco can prevent hospital stays that price may not seem so high.
original industry insider
Agree with Mike and Kimberly. This is the next best thing to gene therapy, which had its share of early failures, but has now shown success in Parkinson’s Disease and adrenoleukodystropy. For many reasons being able to give the proteins that are encoded by specific genes is safer than trying to give the genes themselves. Unfortunately the “one gene, one protein” theory can’t account for all genetic diseases, hence gene therapy maybe the only alternative in many genetic disorders.
For example, one of my pharma R&D projects was to investigate the potential for use of gene therapy for medullary carcinoma of the thyroid. If that ever reaches the stage of clinical testing, already tens of millions of dollars will have been spend to get it into the clinic. Like the patients with this particular CF mutation, MCT is uncommon, hence the therapy will need to be expensive, considering the enormous investment in R&D for these treatments. Examples are in the article below, and recall that to date not a single patient has been tested with this particular form of gene therapy.
http://www.thyroid.org/ann_mtg/2003_75th/documents/004_Spitweg.pdf
M Helm, MD
Well, I was interested and hopeful until I actually read the PI. This is nowhere close to the “next best thing to gene therapy.”
It is nothing more than a small molecule ion channel opener. It seems to interact with only one of the more rare CF transmembrane regulator protein mutations.
It will be interesting to see how many of the 1200 or so patients with this mutation will actually be able to recieve it due to it’s costs. Oh, BTW, don’t worry about Vertex, I don’t think they have nearly as much invested in it as the CF Foundation, and Vertex gets all kinds of tax advantages to offset the necessary investment in research and development. The compound looks simple to synthesize, so the price is going to be essentially all profit.
They won’t even need a sales force to sell the drug. CF patients benefit from a national registry program and treatment in certified CF centers.
The primary barrier for this drug is that know one knows if there is any benefit beyond an improvement in how much air volume can be exhaled in the first second of breathing. Some of the patients in the trials actually had normal lung functions at baseline. In a practical real world, the patients with normal lung function shouldn’t receive it (they are unlikely to benefit from the only thing it is really proven to do).
In other words, this may or may not improve CF symptoms in the long run, and it may or may not (probably it won’t) extend life. Unfortunately, because it is only approved for ages 6 and up, by the time a child may be able to use it, there may already be colonization with one of the bacteria that are associated with worse outcomes.
That’s a real shame. For that cost there I had hoped there would be more there. On the other hand, if the population is truly that small, Vertex can get away with whatever they want regarding pricing. I expect the only payors who will actually buy are are state or federal government funded. If a patient’s CF is a disabling conditino and they can qualify for SSI, after two years they are eligible for Medicare.
I can already envision the PA restrictions and patient copay/coinsurance requirements in the private markets…
Fortunately, life expectancy for CF patients has continually risen over the past two or three decades. Improved pulmonary treatments, learning how to better treat the bacterial colonization and growth issues, and (importantly) early diagnosis have been responsible for that. CF is now a part of routine infant screening in many states.
Overall outcomes are dramatically better with improved standard treatment. That’s a real credit to the families, medical professionals and researchers who deal with CF every day. I know the outcomes are still not where anyone would want them to be. I don’t really see this adding significantly to the total outcomes gains in CF treatment. I do see it using up a significant amount of the resources devoted to treatment. Maybe, I’ll be wrong…
keiner
“The cost of clinical trials, pipeline development, failed drugs, promotion and education, etc”
Hmmm, you forgot the costs of external “consults” like PwC, Deloite et al. and costs for mergers and acquisations, including bonuses to the involved investment bankers.
Big pharma is the most contaminated bussiness in the world when it comes to neolib nonsense. And changing the direction every months has become standard, improving the bussiness of PwC etc, but not of Pharma. Let alone patients or society in general…
It’s a shame.
original industry insider
Dr Helm, the molecule may be straightforward to synthesize, but with gene therapy you replace the missing gene and the patient synthesizes his or her own protein at no cost.
I agree that it’s a relatively straightforward organic synthesis, from looking at the molecular structure, perhaps no more than 10 steps. Remember, however, the cost for synthesis of all the failed compounds that didn’t work, as well of the cost of the gene library that identified the mutant gene in the first place.
Theoretically the downstram costs of replacing the mutant gene may be less than the $300,000 you have to shell out annually for the drug. It’s like replacing the motherboard on a computer. There is a large upfront cost, but in the end may be cheaper than having to fix individual downstram components.
dzieczko
@keiner - once any pig is at the trough, their lipstick wears off…
Mike Wokasch
Congrats to Vertex. And for those who feel the price is high, keep in mind that there are not many Pharma companies today that would persist in a 15 year development crap shoot for such a small patient population. Not only will a small subset of CF patients benefit from this novel new treatment but Vertex has demonstrated the viability of this innovative approach to treating disease.
And, for the Dr. Helms’ of the world, we’re all waiting for your discoveries of novel, innovative new treatments for rare diseases to be approved. I’m sure they are “more than just small molecules”, perhaps gene therapies, which you will no doubt market at small molecule generic drug prices. And how many do you have at the FDA awaiting approval? Patients are waiting. http://www.PharmaReform.com
dzieczko
@Wokasch - Dr. Helms noted, “Fortunately, life expectancy for CF patients has continually risen over the past two or three decades. Improved pulmonary treatments, learning how to better treat the bacterial colonization and growth issues, and (importantly) early diagnosis have been responsible for that. CF is now a part of routine infant screening in many states.”
If you listen to your customers (Ferengi’s 7th Law of Acquisition), you have the following potentials:
1. pulmonary treatments
2. bacterial colonization/growth
3. diagnosis (in this case, know if the patient is from the subset that will benefit)
original industry insider
I say thank God we live in the United States of America and we don’t have to do a cost benefit analysis before giving this novel treatment. In any other country that practices socialized medicine denying this drug would be a no brainer for the pinheads running the healthcare system. They would run the numbers and come back with the verdict that we should save the $300K/patient and let those 4% of CF patients die, better to use the money for the other 96%.
This is another reason why Obamacare needs to die a quick and painful death. One of its architects, Dr Ezekiel Emanuel was the considered to be the Rationing Czar behind the plan. According to Dr Zeke young children and old folks don’t deserve health care dollars, the old ones because they have outlived their usefulness and babies because they have yet to prove their usefulness to society. It’s called the Complete Lives System. Read below and be very scared.
http://www.thelancet.com/journals/lancet/article/PIIS0140-6736(09)60137-9/fulltext#article_upsell
original industry insider
Keiner, you should understand the cost scale for the platforms needed to run the high throughput gene sequencing analysis used to identify these types of mutations. For example, the cost of a IBM eX5 Enterprise Server with all the bells and whistles will run upwards of $1,000,000. You can’t just drive over to Best Buy, pick one off the shelf and pay by credit card. You need that big time M&A activity to save up the cash to buy one of these systems, albeit at a cost of a few thousand pink slips. The money we spend on consultants is a drop in the bucket by comparison.
dzieczko
@OII
There is nothing that stops people living in the 36 developed countries with BASIC universal health care (who are ahead of the USA in many metrics) from buying the Vertex drug for cystic fibrosis. Don’t tell me that non-USA patients weren’t counted upon as being potential customers for this drug.
A few thousand pink slips handed out just to buy a million dollar computer?! What on earth are you talking about?
original industry insider
Correction, dz you are right. Only needed a couple dozen pink slips to cover the cost of that mainframe. Needed more layoffs to entertain our high priced consultants at five star restaurants. For example, the cost of a basic dinner at the Tewksbury Inn, consisting of an appetizer of Steak Carpaccio and Tartare, a Boston Bibb Salad, and an entree of Filet Mignon au Poivre, plus a couple of glasses of a nice Cabernet will run about $100 per consultant. You do the math, and the pink slips will make more sense.
M Helm, MD
For those who might be interested to know more about the phenotype of patients with this particular mutation, here is a recent abstract: http://qjmed.oxfordjournals.org/content/102/11/793.abstract
The long and short of is that this particular mutation is associated with less severe disease. (If you look at some of the demographics and baseline data for the study populations in the PI you can get a sense for that - which made me look further.) Do not mistake me - there is NO “good” type of CF. It is just important to understand that this mutation may have a less rapid progression and less severe manifestations. So, again. this is a step in the right direction for treatment, but appears to be more of a blind alley than a hopeful step toward gene therapy.
In response to Mr. Wokasch, regarding my list of innovations: I do in fact have about a half dozen ideas which I have not (yet) pursued. In my own estimation, only one would likely result in significant improvement for an uncommon, but severe medical problem. That particular idea would also be the most difficult to commercialize and to study, but the patient population is sizeable and the potential improvement in care is significant. One idea occurred to me as a resident, while I was caring for several hospitalized CF patients. Except for one, they all do involve small molecules (actually all, except a component of one, are already FDA approved in various, less than ideal formulations). Even so, all would be eligible for a period of market exclusivity and some would likely qualify for new patents as well. Since the active ingredients are already approved, that means they could be more easily reformulated in more useful ways and/or studied for new applications. They could be profitably developed while still being marketed at an affordable price… In short, with one exception, my personal “product pipeline” could get through phase III very quickly. All would fulfill a specific un-met need in medical care. At least one is an absolute lock for approval. So that’s some general info on my “pipeline,” How about yours?
Unfortunately, you and I both know well the barriers to product development (or redevelopment/reformulation). If a compound or formulation can’t gross at least a half billion in revenue annually (I remember when it was $100 million) and have a 10+ year period of exclusivity, even an innovation very likely to be successful is not very interesting.
The CF Foundation (much more than Vertex or any other PhRMA company) will continue to fund work on the target protein and the genetic defect. In 2010, they had net assets of almost $190 million, up about $60 million from the prior year. Their largest source of revenue is their pharmacy services ($138 million), followed by public support ($118 million). CF Foundation does not give up easily, even if the population that can benefit is very small.
original industry insider
If the mutation results in less disease than at least hypothet5ically such person could live to reproductive age, marry a carrier with the same mutation and have a child. If it is allele-dominant there is a 50% chance of the offspring getting the diseaase, and then we are in a whole new ball game as fas are penetrance and severity goes.
This is where replacing a defective gene is preferable to replacing a protein since in the latter case the genetics discussed above still applies.
Also mild doesn’t necessarily stay mild for life as was the case with patient Jessie Gelsinger, who was born with ornithine transcarbamylase deficiency. Protein sparing diet worked for a while, but then gene therapy was required to correct the urea cycle problem. Unfortunately the gene therapy killed Gelsinger, but it was due to vector selection and not the gene itself.
M Helm, MD
OII, Most CF patients do now survive to reproductive age. However, 98% of males are infertile and a good portions of females have significant fertility issues. There are a good number of folks living with CF in their 40’s - virtually unheard of 20 years ago. Understanding the genetics of this (and other) condition does not make for easy decisions on having children I would suppose