(Reuters) – An experimental gene therapy for spinal muscular atrophy (SMA) developed by Novartis AG would be worth up to $900,000, according to an independent U.S. nonprofit organization that reviews the value of drugs and medical treatments.
The Boston-based Institute for Clinical and Economic Review (ICER) made the determination using a commonly cited cost-effectiveness threshold that values each “quality-adjusted life year” (QALY) gained at $100,000 to $150,000.
If each QALY gained were assessed at $500,000, ICER found the gene therapy, Zolgensma, would be cost effective at just over $5 million.
Novartis has said the price will be determined in negotiations with health plans, but it believes the gene therapy would be cost effective at $4 million to $5 million as a one-time treatment.
The company said in an emailed statement on Friday that “both the rare disease community and various governmental bodies” suggest that $500,000 per QALY “is the appropriate standard to protect vulnerable populations and allow access to innovative, transformational therapies.”
SMA can lead to paralysis, breathing difficulty and death. It is the leading genetic cause of death in infants.
Gene therapies use engineered viruses to carry healthy genetic material into a person’s cells to replace faulty or mutated genes that cause a disease or condition.
ICER also found that Spinraza, Biogen Inc’s SMA treatment would require a substantial price decrease to be considered cost effective. Spinraza’s current list price is $750,000 for the initial year and $375,000 per year thereafter.
Biogen noted that Zolgensma is experimental and has reported data for only 15 patients, compared with Spinraza’s track record of use by more than 6,600 patients. Spinraza is considered by Wall Street to be one of Biogen’s most important growth drivers.
“The promise of gene therapy in general is that it would be once and done … but that is uncertain at this point,” Biogen Chief Medical Officer Alfred Sandrock told Reuters.
“Spinraza is still a very viable option for babies with SMA. For children, teenagers and adults it may be the only option open to them,” Sandrock said.
Spinraza was approved in 2016 to treat SMA in children and adults.
The U.S. Food and Drug Administration is expected to decide sometime in May whether to approve Zolgensma, which has been studied in infants with SMA.
ICER’s assessments have become increasingly influential in U.S. drug price negotiations and are taken into consideration by insurers making decisions about patient access to treatments.
Using an alternate measure known as “life years gained” (LYG), ICER found the Novartis gene therapy cost effective at a price as high as $1.5 million.
ICER found that Spinraza, when used for patients who do not yet show symptoms, would have value at up to $130,000 for the first year and $65,000 for each successive year. Based on the LYG measurement, the price could be as high as $82,000 during the initial year and $41,000 per year thereafter, according to the ICER report.
At the QALY value of $500,000, Spinraza was seen by ICER as cost-effective at $264,000 per year.
Reporting By Deena Beasley; Editing by Bill Berkrot