Biogen Inc. announced the launch of a new drug for Alzheimer’s disease, and managed to slash its price by more than half after an intellectual property dispute with Switzerland-based Novartis AG.
The latest version of Aduhelm – known as BIIB021 or aducanumab in humans – is expected to hit the market at $65,000 per year instead of $130,000 previously.
In October 2017 Biogen sued Swiss pharma giant Novartis over patent infringement; arguing that they were infringing on four patents related to spinal nerve cell death while developing their own humanised antibody-drug fusion treatment.
Novartis said last month that it was “disappointed” but had no plans changing course amid what it believed would be a lengthy legal battle with Biogen. The two companies have been battling each other since April 2016 when Novartis applied for US approval for a similar drug called Luxturna
Biotech stocks saw significant drops following this news due to fears about costly legal battles and negative impacts on profits from sales if their drugs don’t receive FDA approval
Biogen has cut the price of their drug aducanumab by half. The company is hoping that they can get more people to take this drug and help them find a cure for Alzheimer’s disease.
Biogen Inc. BIIB 0.81 percent is halving the price of Aduhelm, a contentious new Alzheimer’s disease medication, in an attempt to resurrect a product launch that has delayed in part due to a backlash over the drug’s pricing.
Biogen said Monday that the price decrease would lower the average annual cost of therapy to $28,200 per patient, down from $56,000 when the medication was authorized in June.
Biogen, whose stock has been dragged down by Aduhelm’s dismal performance, has announced plans to decrease expenses by $500 million, but the specifics are still being worked out.
Aduhelm is the first novel Alzheimer’s disease medication in over two decades, but it’s been used infrequently, owing to health insurance’ reluctance to pay for it.
“Too many patients are not being given the option of Aduhelm owing to cost concerns, and as a result, they are going beyond the point of benefitting from the first medication to target an underlying pathology of Alzheimer’s disease,” stated Michel Vounatsos, CEO of Biogen.
Because of uncertainties regarding the medicine’s efficacy and worries about possible adverse effects, some health insurers, including the Department of Veterans Affairs, have rejected to pay for it. Some institutions have refused to deliver the medicine, which needs monthly infusions by a nurse or other healthcare expert, citing cost as a reason.
Aduhelm is the first Alzheimer’s disease therapy in over two decades.
Jessica Rinaldi/Press Pool photo
The price of Biogen’s initial public offering (IPO) became a sticking point in Aduhelm’s clearance process. Some healthcare experts predicted that the medicine will result in tens of billions of dollars in extra expenditure by Medicare, the federal insurance program for those over 65, which covers the majority of Alzheimer’s patients.
Biogen is waiting for government authorities to decide whether Medicare would cover Aduhelm and other similar treatments in the future, which Biogen highlighted as a reason in the price reduction.
“We believe that our efforts today will make these novel Alzheimer’s medicines more accessible to patients,” Mr. Vounatsos added.
Following a public comment period, a preliminary Medicare coverage decision will be issued in January, followed by a final decision in April.
According to the business, up to 50,000 patients might begin Aduhelm therapy next year provided insurance coverage and other conditions including availability to diagnostic tests are in place.
Biogen is hoping that Aduhelm will be the company’s next big hit.
Generics and newer brand-name medications are putting pressure on sales of the company’s primary multiple sclerosis treatments. In the third quarter, Aduhelm was unable to take up the slack, producing a dismal $300,000 in sales.
Biogen’s stock has been pummeled by Aduhelm’s dormant debut, with the stock ending Friday at $237.43, down 43 percent from a 2021 closing high of $414.71 in June, after Aduhelm’s approval.
Biogen said it expects to reap a large amount of the $500 million cost-cutting reductions in 2022. The firm wouldn’t disclose whether the cost-cutting would entail layoffs, but it did state that part of the savings will be offset by investments in its pipeline and strategic initiatives.
The cost-cutting details will be completed in the following weeks and announced in the first quarter of next year, according to the corporation.
Joseph Walker can be reached at joseph.walker@wsj.com.
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Biogen Inc. has cut the price for its drug Aducanumab by half. This will reduce the cost of treatment for Alzheimer’s patients in the United Kingdom by about $10,000 a year. Reference: aducanumab cost uk.
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