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France clears way for wide use of Vertex’s Orkambi

The French government authorized full reimbursement for Vertex Pharmaceuticals’ cystic fibrosis drug Orkambi, a decision that will open up its use to an estimated 2,500 to 3,000 patients. France’s decision follows that of the United Kingdom, which last month authorized reimbursement for all of Vertex’s cystic fibrosis drugs.Orkambi had been available through a compassionate use program since December 2015 for patients aged 12 years and older. Today’s announcement clears its use to patients as young as two, and moves those already receiving Orkambi into the new program.Vertex and the French government did not disclose a reimbursement rate because of a confidentiality agreement. Orkambi’s list price is $272,000 a year in the U.S.

Orkambi (lumacaftor/ivacaftor) treats a subset of cystic fibrosis patients, those homozygous for the F508del mutation in the CFTR gene, which represents about 2,500 to 3,000 of the 7,000 patients in France, according to Stifel analyst Paul Matteis. France is the 21st country that has OK’d paying for Vertex’s cystic fibrosis drugs.

Still, the high price of Orkambi and the other Vertex cystic fibrosis drugs Kalydeco (ivacaftor) and Symdeko (tezacafto/ivacaftor) has troubled payers around the world. The European Commission’s licensure of Orkambi in late 2015 triggered a long-running negotiation between the U.K. and Vertex that only wrapped up in October, and now France has done the same.

Because of a confidentiality agreement, neither party will disclose a price. In 2018, the U.S. independent review commission Institute for Clinical and Economic Review determined that a value-based price would be around $80,000 a year if the cost-effectiveness limit were set at $150,000 for every “quality adjusted life year” (QALY) gained by using Orkambi over best supportive care.

European payers tend to have lower thresholds, with the U.K.’s National Institute for Health and Care Excellence tending to set a limit of no more than 30,000 pounds ($38,000) per QALY as a limit.

France does not have an explicit limit. An analysis of 12 decisions found that its payment watchdogs have authorized reimbursement at cost-effectiveness thresholds as high as 192,000 ($212,000) euros per QALY, although half of them were below 50,000 euros per QALY.

Stifel’s Matteis said Vertex had been recording some of the revenue from the compassionate use program reimbursement as sales but had also recognized potential expenses in the event that the French government set a lower final Orkambi price and demanded Vertex pay it back. Depending on the final price, those potential repayment expenses could be reported as earnings as soon as the current quarter, Matteis said.

Last month, Vertex won Food and Drug Administration approval for a cystic fibrosis triple drug called Trikafta (ivacaftor/tezacaftor/elexacaftor), which will face similar payer scrutiny around the world.