Drug for Ultra Rare Disease Comes with Ultra High Price Tag

(Bloomberg) -- Alnylam Pharmaceuticals Inc.’s Givlaari became the first drug to win U.S. approval for patients with an ultra-rare and devastating metabolic disorder. Shares jumped on the news.

It will come with an annual wholesale price tag of $575,000. Patients will need to take it for life.

There are about 3,000 people in the U.S. and Europe diagnosed with acute hepatic porphyria, where a genetic mutation leaves patients unable to produce an enzyme essential for the function of hemoglobin, the red blood cells that carry oxygen throughout the body. The condition causes a buildup of toxins that can lead to chronic debilitating symptoms and bouts of stomach and muscle pain so severe patients require hospitalization.

Gilvaari is the first medicine patients can take regularly to help ward off attacks and ease the condition, which Alnylam said already costs more than $500,000 per patient to treat because of frequent hospitalizations and the need for supportive care.

Trading in New York was halted before the company’s announcement. When it resumed, Alnylam shares were up as much as 11.3%, the biggest intraday gain since August 2018. They are up almost 50% this year.

The U.S. Food and Drug Administration approved Givlaari, also known by the chemical name givosiran, based on the results of a study involving 94 patients with acute hepatic porphyria. Those getting the medicine were 70% less likely to experience porphyria attacks, including those that required hospitalization, health-care visits or intravenous infusions of a drug that limits the body’s production of toxic compounds caused by the disease.

Existing treatment provides only partial relief from the unremitting pain that comes with the attacks and stems from the buildup of toxic porphyrin molecules that are formed during the production of heme, said Richard Pazdur, director of the FDA’s Oncology Center of Excellence. The attacks can lead to paralysis, respiratory failure, seizures and mental confusion, he said.

“These attacks occur suddenly and can produce permanent neurological damage and death,” he said in a statement. “The drug approved today can treat this disease by helping to reduce the number of attacks that disrupt the lives of patients.”

Costly Therapies

The drug will be one of the most expensive in the world by list price. Its high cost reflects a growing phenomenon for rare-disease therapies where companies recoup their development expenses and fund future work with products that can be given to only a handful of patients.

For many patients, health insurance covers much of the cost of even high-priced pharmaceutical treatments. But cost-sharing requirements in drug coverage can still present a significant financial burden, sometimes leaving people with thousands of dollars in out-of-pocket expenses. In some cases, drugmakers’ financial-assistance programs can help.

Alnylam is planning several steps to try to keep costs under control, Chief Executive Officer John Maraganore said in a telephone interview.

The company is working with large health insurers like Cigna Corp. and state Medicaid programs to provide coverage. It will also help patients verify their insurance benefits and get financial assistance for those who qualify.

The net price will be about $442,000 a year after taking into account discounts for Medicare and programs designed to cut costs for poor patients, Maraganore said. He also pledged to limit the pace of price increases.

“We don’t believe in growing our business through price increases,” Maraganore said. “We will cap any price increases to the rate of inflation.”

The price is based in large part on the rarity of the condition, with just 1,000 patients suffering from the most severe disease, Maraganore said. As with many diseases, especially those that have hard-to-pinpoint symptoms, a significant number of people with it may be undiagnosed, he said. If the number of patients found to have the condition rises substantially after the treatment becomes available, the company will adjust Givlaari’s price, he said.

“In any given insurance plan, if the incidence and prevalence is what we expect it to be, then $575,000 per patient per year is the right price,” he said. “However, if over time, with improved awareness rates, there are more patients, then we are willing to decrease our price, in the form of a rebate.”

Value-Based

Alnylam will also provide rebates to insurers for patients who don’t respond to treatment.

“We are already talking to payers about value-based payments, so we will have some skin in the game,” he said. “If patients respond well, we will be fully paid. If they don’t have an acceptable response to the drug, we will give a rebate back to the payer.”

Givlaari had been given an array of designations from the FDA intended to speed the availability of new drugs for unmet medical needs, including breakthrough designation, priority review and orphan drug status. Its approval came two and a half months earlier than the FDA’s deadline of Feb. 4, 2020.

Patients’ liver function should be monitored before and during treatment, along with kidney function and observation for allergic reactions, the agency said.

To contact the reporter on this story: Michelle Fay Cortez in Minneapolis at mcortez@bloomberg.net

To contact the editors responsible for this story: Drew Armstrong at darmstrong17@bloomberg.net, Timothy Annett, Mark Schoifet

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