Analysts Blindsided by Price of New Alzheimer's Drug

Monday brought the big news that the FDA had approved the first new Alzheimer’s drug in 20 years. Then came news of its price tag. That would be $56,000 for a year's worth of Aduhelm, also known as aducanumab (a user's out-of-pocket cost would depend on their insurance). CNBC reports that's shoulders above the $10,000 to $25,000 range it describes Wall Street analysts as anticipating. Maker Biogen fielded questions about the price on Tuesday, with one analyst citing a perceived "disconnect" between the price and words used in a press release about the drug—"responsibility, access, [and] health equity" among them. Biogen's explainer: Alzheimer's costs the US billions annually, making the price "responsible," according to Biogen execs. More:

• Those execs pledged to freeze that price for the next four years and said the revenues from Aduhelm will allow Biogen to continue to pursue other drugs. Fierce Pharma reports those revenues could be staggering thanks to the FDA's decision to approve the drug for all Alzheimer's patients, versus a subset of them, and to not place a limit on how long patients should take the drug for. That could result in sales approaching $10 billion annually before the decade is out.
• But that's just the price of the drug itself, which is administered monthly via IV. Bloomberg reports those who take it will also need pricey brain scans to verify there is no brain swelling, and there will be substantial costs related to facilitating those infusions.
• And then there's the question of whether the drug will work: With its approval, the FDA disregarded warnings from independent advisers that the drug hadn't been shown to help slow the brain-destroying disease. As Barron's and the Financial Times report, the $56,000 is many times the $2,500 to $8,300 per year the Institute for Clinical and Economic Review, "an influential voice on drug pricing," in May said would align with the clinical benefits offered by the drug. ICER said Biogen's price would only be appropriate if the drug actually managed to stop cognitive decline.
• Barron's notes the price could have an unpleasant side effect for pharmaceutical companies: Most of those who would take the drug are on Medicare, and the massive financial impact it could have on Medicare could force legislators to finally tackle the subject of drug price reform.
• The Financial Times suggests Biogen has thick skin when it comes to complaints about pricing, which it reports it has fielded previously over its pricey multiple sclerosis and spinal muscular atrophy drugs.

(More Alzheimer's disease stories.)