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Medicine United States

FDA Approves First Cell-Based Gene Therapy, Becomes Most Expensive Drug In US (reuters.com) 91

Posted by BeauHD from the innovative-therapies-that-come-at-a-cost dept.
An anonymous reader quotes a report from Reuters: The U.S. Food and Drug Administration on Wednesday approved bluebird bio's gene therapy for patients with a rare disorder requiring regular blood transfusions, and the drugmaker priced it at a record $2.8 million. The approval sent the company's shares 8% higher and is for the treatment of beta-thalassemia, which causes an oxygen shortage in the body and often leads to liver and heart issues. The sickest patients, estimated to be up to 1,500 in the United States, need blood transfusions every two to five weeks. The therapy, to be branded as Zynteglo, is expected to face some resistance from insurers due to its steep price, analysts say.

Bluebird has pitched Zynteglo as a potential one-time treatment that could do away with the need for transfusions, resulting in savings for patients over the long term. The average cost of transfusions over the lifetime can be $6.4 million, Chief Operating Officer Tom Klima told Reuters before the approval. "We feel the prices we are considering still bring a significant value to patients." Bluebird has been in talks with insurers about a one-time payment option. "Potentially, up to 80% of that payment will be reimbursed if a patient does not achieve transfusion independence, they (insurers) are very excited about that," Klima said. The FDA warned of a potential risk of blood cancer with the treatment but noted studies had no such cases. "Bluebird expects to start the treatment process for patients in the fourth quarter," reports Reuters. "No revenue is, however, expected from the therapy in 2022 as the treatment cycle would take an average of 70 to 90 days from initial cell collection to final transfusion."
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FDA Approves First Cell-Based Gene Therapy, Becomes Most Expensive Drug In US More

FDA Approves First Cell-Based Gene Therapy, Becomes Most Expensive Drug In US

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  • You know what the insurances will ponder (Score:3)

    by Opportunist ( 166417 ) on Wednesday August 17, 2022 @11:48PM (#62799195)

    "Can we drag out the case long enough so the patient croaks before we have to pay?"

    • Re: You know what the insurances will ponder (Score:4, Informative)

      by Synonymous Cowered ( 6159202 ) on Thursday August 18, 2022 @06:34AM (#62799609)

      That wouldn't be wise of insurers. Dragging it out "until the patient croaks" means the patient just gets blood transfusions instead "until [they] croak". And as the summary says, the cost of those transfusions will add up to more than double the price. So every transfusion while they delay is potentially just wasted money.

      • Re: (Score:2)

        by dfghjk ( 711126 )

        Says the drug company. Paying absurd prices for a drug is not inevitable.

        • Re: You know what the insurances will ponder (Score:4, Insightful)

          by HiThere ( 15173 ) <charleshixsn@@@earthlink...net> on Thursday August 18, 2022 @09:24AM (#62799907)

          In this particular case it's not clear that the price is unwarranted. IIUC this requires custom genetically modified live cells. I'm sure it also has other complicating factors. It's not a simple "take/inject this chemical". So it's talking about a procedure that has never been standard.

        • Unfortunately, people with rare diseases often get stuck with high prices for their health care because it costs the same to create a drug for 1,000 people as it does to create a drug for 10,000,000 people, but those development costs are only split 1,000 ways vs. 10,000,000 ways.

          It's not fair to stick it to people financially who are also dealing with a poorly understood rare disease. But the drug companies have to recoup their costs (and make a profit), so the burden ends up on the insurance companies w
      • During the delay, the patient might switch insurers. I'm sure somebody at the insurance company can run the numbers on this probability compared to the cost of a few more transfusions.

      • > And as the summary says, the cost of those transfusions will add up to more than double the price. So every transfusion while they delay is potentially just wasted money.

        Since the 1970's the revenue model of all the insurance companies is to collect premiums, invest them in the stock market, and then pay out expenses from profit. That's why AIG got $800B from the Federal Reserve during the 2008 market crash.

        So "double" may not be meaningful if the RoI of the market is less than 100% during the patient

    • It's funny where people lay blame.

      Health care costs high - > blame health insurance companies over doctors, hospitals, drug companies.

      Student loan debt out of control - > blame the loans not the education instutions raising their prices year after year.

      • Both of these are solved by the same type of solution: universal health care and universal (free) college.

        People shouldn't go bankrupt because they get sick.

        People shouldn't be held in indentured servitude for their whole lives because they tried to become a doctor (or accountant, or whatever) but couldn't hack it when they were 19 years old and stupid.

        • Free (as in, paid for by your taxes after you graduate and make the big bucks) college has a side effect: Everyone and their dog wants to get a degree. Because they now can afford it. So colleges, who are not dependent on carrying your sorry ass around, test you. Mercilessly. Every dropout is one fewer idiot they have to haul about and care for.

          Our colleges have dropout rates ranging in the 80-90%. With some of the more popular ones hitting even higher dropout rates, especially during the first few semester

          • Found the college teaching assistant.... There are worse things to shill for, I guess. I will say this, though. I'd much rather hire a kid who got through 1 semester of college algebra or passed Opsys 101 than a frat-boy Business, English, or Polysci "graduate". So, your idea about college being a good mechanism to weed out "idiots" is pretty questionable. Higher ed is definitely churning out idiots with regularity. They are also often far-left indoctrination and reeducation centers, too. Some aren't cool w

            • I sure as all fuck wouldn't want to teach at our colleges. Why do you think they weed them out like crazy? Because they don't get anything extra for them. The less students they have to put up with, the better.

              And yes, for-pay degrees are basically worthless. If my pay depends on having as many dunces in my class as possible, guess what, everyone gets a degree who keeps paying year after year for it. What's my incentive to kick the duds out? If I do so, they stop paying!

              • Ah, I see. Maybe that explains why my first-year CS class in C++ was trying to teach people about templates and vectors in the first week of class. I had already been a C++ programmer for years. I was one of about 4 people who passed this class out of about 45 who initially enrolled and 25 who stuck it out after weed-out. I went to the prof and asked him why he didn't discuss variables or loops first. He told me that he structured the class to fail out everyone who "couldn't hack it in CS". I was also surpr
        • College was a lot more affordable [gradesfixer.com] before the government got involved. So was healthcare [heartlanddailynews.com] which got more expensive after government fondling [fee.org]. I'll take "reasonable" over "free" if it means less coercion and taxes and history is clearly demonstrating that government involvement drives the cost up.

  • Absolutely stupid (Score:4, Insightful)

    by Turkinolith ( 7180598 ) on Wednesday August 17, 2022 @11:53PM (#62799205)
    Their rational in that the average cost of transfusions over a lifetime can be $6.4M that they charge $2.8M for the treatment. I'm sorry, how many of those 1,500 people who have this issue can afford ANY of that?

    • Re:Absolutely stupid (Score:5, Insightful)

      by dvice ( 6309704 ) on Thursday August 18, 2022 @12:18AM (#62799245)

      If they invest the 2.8 million now, in 40 years they have 126 million. It is a different story if they take only 2.8 million, but allow to pay it 70000 per year for the duration of 40 years.

      There is a simple solution to it.
      1. Get rid of drug patents world-wide
      2. Make WHO more powerfull by giving 90% of current money that goes into drugs to it to be distributed for drug etc. development.
      3. Universities around the world start doing the final step of drug research in addition to the ground breaking work they currently do with they money from WHO.
      4. Everyone gets free medicine (it is so cheap that everyone can get it free), we get medicine for deceases we didn't even have medicine for and all illnesses from the world are removed. Governments save trillions of dollars due to having healthier people. Drug companies lose their money.

      • Agree that healthcare is an investment in society & economy rather than a profit centre, i.e. keeping everyone healthy results in greater physical financial security, a happier population, & greater economic productivity. In that sense, prevention is better than cure so encouraging everyone to have healthy lifestyles, i.e. diet & exercise, thereby extending active lives & reducing the need for medical interventions, pays dividends. That's why a lot of developed countries have municipal gyms

        • Re: (Score:2)

          by HiThere ( 15173 )

          FWIW, I think that either extreme position is bad. Yes, the current system in the US is full of perverse incentives that need to be removed. And the "free market" doesn't work when someone needs urgent care. But there are also many procedures that really ARE elective. And some that are so rare, that insurance is a good model for how to handle it.

          Drug patents are a really bad aspect of current law. In my opinion if someone stops making a drug, the patents on that drug should be invalidated. I'm really

      • Re: (Score:2)

        by dfghjk ( 711126 )

        Or empower the patients through single payer as opposed to the current divide-and-conquer drug financing system. The reason this exists is because the patients who need it have no champion.

        No one gets "free medicine" EVER and all you are suggesting is a shell game, one where the government is entirely responsible for all drug development. You're offering no solution here, just a belief that only the drug companies are corrupt.

      • 1. Get rid of drug patents world-wide
        2. Make WHO more powerfull by giving 90% of current money that goes into drugs to it to be distributed for drug etc. development.
        3. Universities around the world start doing the final step of drug research in addition to the ground breaking work they currently do with they money from WHO.
        4. Everyone gets free medicine (it is so cheap that everyone can get it free), we get medicine for deceases we didn't even have medicine for and all illnesses from the world are removed. Governments save trillions of dollars due to having healthier people. Drug companies lose their money.

        Wow. This really makes sense to you?

        • Doing it through the WHO might be a mistake for larger nations with well-established research systems, like major universities.

          There's literally no need for medicine to be for-profit to function. It can literally be handled by public research institutions.

      • 2. Make WHO more powerfull by giving 90% of current money that goes into drugs to it to be distributed for drug etc. development.

        Empower further an organisation led by China sucking Marxist who refises to say "Taiwan"?

        Thanks, but no thanks.

    • I'm sorry, how many of those 1,500 people who have this issue can afford ANY of that?

      Any of them that have health care insurance that has to pay for the $6.4M. The big insurance companies -- that's just petty cash to them.

      Not outlandish really. Those kind of numbers are pretty easy to reach for cancer care payments, where one chemo treatment can run into six figures.

      • Re: (Score:1)

        by Anonymous Coward

        How about, "good for them, putting forth the effort to develop a treatment for 0.00042% of the population". Being that the insurance companies are going to be paying it...and it's probably going to be saving them money...there's really no issue here. The system worked. It's generally considered foolish if an ordinary company would develop a product for a limited pool of customers...it's pretty amazing that this company would choose to do so. Now they can use that money to develop treatments for other sm

        • Exactly Even more, transfusions are so so painful and horrendous procedures, so this improves quality of life immensely as well

        • How about, "good for them, putting forth the effort to develop a treatment for 0.00042% of the population".

          Agreed. The person who sugested elimating drug companies and have WHO be in charge of this really needs to understand that no resources would go into something that effects that small portion of the population/

          Being that the insurance companies are going to be paying it...and it's probably going to be saving them money...there's really no issue here.

          I am not for a single payer system - I have family on Medicare and it is much worse than my private insurance. That said, this is were single payor has advatages. An insurance company might not look at the cost savings throughout a patient's lifetime as there is no guarentee that the patient will even

          • I am not for a single payer system - I have family on Medicare and it is much worse than my private insurance. That said, this is were single payor has advatages. An insurance company might not look at the cost savings throughout a patient's lifetime as there is no guarentee that the patient will even have the same insurance for most of their lifetime.

            And you think politicians will? Anything beyond their term is someone else's problem anyway, and there's money to be spent now on getting reelected.

    • Didn't the federal government just pass a law that lets them set prices on drugs and treatments - not forcing them to be sold at that price, but taxing 95% of the amount they charge above that bureaucrat-set limit?

      If so, they probably figure the government would set a silly low number and they'd have to price it at 20 times the amount they'd have set it at in order to actually collect that amount after taxes.

      Thanks, Joe Biden and the Democratic Party.

      • Re: (Score:2)

        by DRJlaw ( 946416 )

        Didn't the federal government just pass a law that lets them set prices on drugs and treatments - not forcing them to be sold at that price, but taxing 95% of the amount they charge above that bureaucrat-set limit?

        If so, they probably figure the government would set a silly low number and they'd have to price it at 20 times the amount they'd have set it at in order to actually collect that amount after taxes.

        No, none of that [cnbc.com]. The Federal government did just pass a law that allows Medicare to negotiate pric

    • I would guess this is just the first volley of pricing, and the company is trying to establish value in anticipation of their potential for sales versus their R&D efforts. In practice the pricing is not likely to be this much, especially with insurance teams bargaining with them. Besides, if nobody will pay for the treatment they get zero, which certainly doesn't divide well with shareholders.

      It's useful for everyone that this kind of targeted gene therapy is validated as both available and practical, a

    • $2.8 million is actually a really good price for a live-changing treatment.

    • The people aren't paying the insurance is paying for it. And at that price it makes sense whether your insurance is public or private. The current treatment costs $6.4M because they needs transfusions every two to five weeks for the rest of their life. So this will not only give people a better quality of live. But it will save their insurance company / government money as well.

  • So they based it on the already inflated costs in the most expensive, overpriced system in the world? "Look at the list price of these already hyper-inflated costs? You only have to pay a portion of that cost, with no actual relationship to the actual costs!" Drug companies are simultaneously great companies and terrible.

  • Would like to know the real R&D costs of this? (Score:3)

    by King_TJ ( 85913 ) on Thursday August 18, 2022 @12:33AM (#62799269) Journal

    I have no doubt it was extremely expensive to produce, as the first cell-based gene therapy and all. But yeah, pricing it this astronomically high really feels like a money-grab, especially in light of the fact they're saying they estimate there are only 1,500 or so potential patients sick enough to be good candidates for this right now.

    This is yet another situation where I think the best answer is to rethink our current legislation as it pertains to big pharma. Instead of this Federal govt. protection they enjoy now where they're guaranteed exclusive sales of a new drug at any price they want to charge? We need to go to a system where whoever creates a new drug is allowed to make royalties selling the formula to any other interested parties. If there really is nobody else interested in making it? Well, then they get to keep selling it exclusively. But the current system where no matter how great/useful/needed a new drug is, people have to wait years before anyone is allowed to sell a generic version? It stinks.

    • Compulsory licensing is an interesting idea, although the sorts of treatments this article is about are complex enough sorts of things that there may not be the expertise available to spin it up like you might be able to with simple pharmaceuticals. Kind of like how during the pandemic, they lifted the patents on the mRNA vaccines but since everyone that was capable of making mRNA vaccines was already doing so it didn't really affect availability a great deal. Still, you're probably onto a good idea and I
    • R&D costs are generally not the bulk of the basic price. The trouble in R&D is usually the time investment. You have to find a basic molecule or similar that does something. Then you have to find which one does it best. The expensive part comes from the testing, called Trials. The most expensive Trial (Phase 3) can run anywhere between 40 mio USD up to several billion.

      • Re: (Score:2)

        by HiThere ( 15173 )

        Tests are part of R&D. In this particular case, the really limited number of potential users means that that small number of users has to pay for all the R&D.

        FWIW, I don't think that's really fair. Much of the early R&D (by the drug company) will probably have additional uses further on. But they can't be sure of that.

      • Exactly. People seem to think that every all R&D leads to successful expensive drugs. They don't realize all the faluires to get there.

        Worse stiil, people look at the cost to produce a drug and think that is what the drug should cost. They ignore all the money spent to get to that stage.

    • I have no doubt it was extremely expensive to produce, as the first cell-based gene therapy and all. But yeah, pricing it this astronomically high really feels like a money-grab, especially in light of the fact they're saying they estimate there are only 1,500 or so potential patients sick enough to be good candidates for this right now.

      It might not have cost that much to produce this treatment, but they have to recoup the costs of all the treatments they tried that did not work. If you don't allow that, then you ensure companies do not try new methods without a large guarentee of success.

      Also, they typically have only 7 years to recoup the costs before generics are allows. We can discuss shorting that, but then the cost will go up for that shorter timeframe.

    • Re: (Score:2)

      by ceoyoyo ( 59147 )

      But yeah, pricing it this astronomically high really feels like a money-grab, especially in light of the fact they're saying they estimate there are only 1,500 or so potential patients sick enough to be good candidates for this right now.

      That's why it's expensive. If you develop somehting you can sell to lots of people, you have to charge each of those people less to pay less to recoup the development cost.

      Treating rare things is expensive. The point of insurance, of any kind, is to spread the enormous expe

    • The real R&D cost has been quite substantial. This biotech company has been sucking down investors' money for decades, and this drug is their first shot to get into the black.

      From their most recent 10-K [bluebirdbio.com]:

      Since our inception in 1992, we have devoted substantially all of our resources to our development efforts relating to our product candidates, including activities to manufacture product candidates in compliance with good manufacturing practices ("GMP") to conduct clinical studies of our product candidat

  • Switching Insurances (Score:3)

    by PseudoAnon ( 5437498 ) on Thursday August 18, 2022 @01:52AM (#62799335)
    I wonder what percentage of people with that condition end up switching to a different insurance during their lifetime. Insurance changes seem common enough for that to be a factor in their decisions to approve or deny treatment. I would think that many profit-focused companies would choose the existing treatment for now and hope the patient becomes someone else's problem later. Someone could have a parent's insurance until their mid 20s, one or more insurances through employers during career years, and then be treated by Medicare if they make it to retirement age. The new treatment doesn't seem like a good bet for insurers at this price.

  • Can anyone explain why the FDA would claim a risk of cancer with no evidence in the studies? Is this technique based on previous efforts that did cause cancer? Is this just the FDA poopooing a new type of treatment?

    • Re: (Score:3)

      by HiThere ( 15173 )

      This is a technique that involves genetic changes to live cells. The positioning of that change is only statistically controllable. There have been cases in the past where such changes have resulted in cells that became cancerous.

      So they're being cautions. They're issuing a warning based in similar cases in the past so they won't be caught in a backlash is such a case should show up here.

    • Re: (Score:2)

      by Rhipf ( 525263 )

      The FDA is just following the California model. Mark everything as potentially causing cancer and then when something does cause cancer you can point out that people were forewarned of the possibility. 8^)

  • Gene therapy works on the basis of modifying the DNA of cells... but not all cells, just the ones it comes in contact with. However, this means that when the modified cells die and are replaced, they may be replaced with unmodified cells or vice versa. Therefore the DNA in the minority effectively has a half-life in which it impacts fewer cells with each generation. Ultimately, if they don't pump you with enough of the gene therapy to modify the majority of the cells in each organ then your organs will s

    • Re: (Score:2)

      by HiThere ( 15173 )

      I believe the cells affected by this treatment are bone marrow cells. If they need to, they could kill them all off, and then replace them by the altered cells. So your argument isn't clearly valid.

      I doubt, however, that that's what they're planning on doing. I haven't checked.

      • Without bone marrow you would die... badly.

        • Re: (Score:2)

          by HiThere ( 15173 )

          That's why you replace it with altered cells. Bone marrow grafts have already been done. It's extreme, but doable.

          • That proposition is extreme. Hell, injecting the gene therapy directly into your bones would be less extreme than what you're talking about.

  • We have a specific government body NICE which makes this determination. We also have the advantage of being a 'single buyer', like Medicare, meaning we can, and do(!) negotiate down what we pay for new drugs.

    NICE's decision making is discussed here: https://www.rnib.org.uk/servic... [rnib.org.uk]

    It's one of the better ways to play this game...

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