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The Most Expensive US Medicine Now Has an Official Sticker Price

The Most Expensive US Medicine Now Has an Official Sticker Price

Maybe if Spark focused its attention on developing a gene-therapy treatment for a disease less rare than the blindness Luxturna is supposed to treat, the company wouldn't have to charge such an exuberant price.

Luxturna, the first gene therapy for an inherited disease in the USA to be injected into each eye, was originally going to be priced at $1 million, but Spark decided against this in the end due to comments from health insurers about their concerns over being able to cover that amount - not that $850,000 is much more manageable. It can improve the vision of those with a rare form of blindness that is estimated to affect just a few thousand people in the U.S. Developers in Europe found this out the hard way when they priced gene therapy treatments at upwards of $1 million, and were unable to market the drugs.

"Our work is not done, but we believe that the offerings we are announcing today will help ensure that eligible USA patients have the coverage and financial support they need to gain access to both Luxturna and the specialized medical care required to deliver the product at treatment centers".

In a phone interview with Bloomberg, Spark CEO Jeff Marrazzo said that "We believe that this price reflects not only the breakthrough, life-altering value of one-time Luxturna, but it will enable us to continue to invest and build on the revolutionary science that supports not only Luxturna but the rest of our pipeline". And knowing full well just how much today's closely-watched marketing plan will be reviewed by the healthcare system, Spark's pricing team has come up with a mix of rebates and proposed staggered payment models created to ease past barbed payer barriers that can cripple any drug launch.

Spark's approach has divided critics, with some who argue that the $850,000 price tag is still too high. Hemophilia treatments for example can now cost up to $300,000 per year, for the lifespan of a patient, so a single dose of a cure priced at $1 million dollars doesn't seem entirely unreasonable. For instance, Spark wants to offer discounts based on whether or not the drug initially works and remains effective; there are roughly 1,000 to 2,000 patients in the US who suffer from this kind of inherited retinal disease caused by a mutant gene.

Spark, in fact, says there will be three distinct "payer programs" to ensure that USA patients who need treatment can get it: "an outcomes-based rebate arrangement with a long-term durability measure, an innovative contracting model and a proposal to [Centers for Medicare and Medicaid Services] under which payments for Luxturna would be made over time". Additional rebate contracts with other commercial insurance companies are being negotiated, Spark said. It costs $425,000 per injection. As a result of current government drug price reporting rules, the company can not offer an installment plan without being forced to sell the drug to Medicaid at an unsustainably low price.




To further allay concerns over the cost of the drug, Philadelphia-based Spark will use unconventional pricing models and schemes with insurers.

The company also plans to arrange for a new type of contracting model with payers to help ease the potential burden of upfront costs on providers.

Spark said it is also discussing a proposal in which insurers would pay for the drug in installments over several years.

Luxturna is delivered to patients just once. "We're at the infancy of what I think could be a lot of innovations in how we pay for these really expensive drugs", Express Scripts' Chief Medical Officer Steve Miller told CNBC.

"It is the first gene therapy to come to market, so not only have they innovated with the science, but working with us, we've innovated in the payment models", Miller said, via The Washington Post.

After the FDA approval, speculation turned to its price.


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