• One-time treatment with an experimental gene therapy for spinal muscular atrophy could be more cost effective than Biogen’s marketed drug Spinraza, even at a price of $2 million per treatment, according to preliminary evidence compiled by the Institute for Clinical and Economic Review and released Thursday.
• Yet both Spinraza and the gene therapy, called Zolgensma and now owned by Novartis, would exceed the commonly used cost effectiveness thresholds used by ICER, an influential U.S.-based watchdog group.
• Novartis hasn’t yet set a price for Zolgensma, which is currently under review by the Food and Drug Administration. The Swiss pharma, though, has argued the gene therapy would offer good clinical value at a price of $4 million to $5 million, given its potential to dramatically alter the course of the often fatal genetic neuromuscular disease.

ICER’s calculations, while preliminary, illustrate the tension between gene therapy’s clinical promise and its expected cost.

People born with spinal muscular atrophy (SMA) lack a crucial protein, causing progressive muscle weakness that makes sitting, swallowing and even breathing difficult. Past natural history studies have shown many patients with the severe, Type 1 form of the disease die before age two.

Zolgensma (onasemnogene abeparvovec), which Novartis acquired in its $8.7 billion buy-out of AveXis earlier this year, offers a substantial net health benefit in babies with SMA, ICER concluded in its draft report.

All 15 infants treated with Zolgensma in a study known as START were alive and off permanent ventilation at two years — milestones usually unattainable with best supportive care. Interim data on 12 patients, aged one month to eight months at the start of the trial, showed treatment with Zolgensma helped almost all sit for more than 30 seconds, eat by mouth and, in four, stand with assistance.

Zolgensma works by replacing the defective or missing primary SMN gene in SMA patients with a functional one, leading to normal production of the needed SMN protein. Novartis intends for it to be a one-time treatment, essentially positioning the therapy as a cure.

The FDA is expected to approve Zolgensma next spring, likely by May. If the regulator gives Novartis a green light, the treatment’s cost will become a flash point in how such therapies should be priced.

ICER’s findings offer some support for a high price tag. Treatment with Zolgensma yielded 11.33 incremental quality-adjusted life years (QALY) gained over best supportive care, below but in roughly the same ballpark as Novartis’ own estimate of 13.3 QALYs.

At an assumed cost of $2 million, the group calculated Zolgensma would cost $247,000 per QALY — above the common threshold of $150,000 per QALY.

That ratio, however, was well below the $728,000 per QALY gained for Biogen’s Spinraza (nusinersen) in presymptomatic SMA patients, the population in which that drug is typically used. Spinraza costs $750,000 for the first year of treatment, and then $375,000 per year thereafter.

At higher QALY ratios, which Novartis argues are best used for ultra-rare conditions like SMA, Zolgensma would be cost-effective at a price above $2 million.

“We are encouraged that the Institute for Clinical and Economic Review (ICER) draft evidence report affirms our initial assessments of the value of our investigational product [Zolgensma] for the treatment of spinal muscular atrophy (SMA) Type 1 at $2 million, and up to $4–$5 million at the appropriate ultra-rare disease threshold,” wrote Novartis in an emailed statement.

Longer-term questions

There are notable limitations to ICER’s findings that could alter how cost-effective the therapies are in real-world use.

“In particular, for both interventions, the narrow eligibility criteria of trials and the limited sample size (especially for Zolgensma) raises concerns about generalizability of results to the wider population of patients with SMA,” ICER wrote in its draft evidence report.

How long Zolgensma’s benefit lasts is another key unknown. Gene therapy is intended as a one-time treatment, but without long-term data, it’s not clear whether efficacy will wane.

ICER did present an analysis in which use of Zolgensma could offset the costs of Spinraza, but advised against its use as Spinraza is new and not considered cost-effective by the group.

That didn’t stop Leerink analyst Geoffrey Porges from suggesting ICER’s numbers, if confirmed in a final report due in March, could prove helpful for Novartis.

“While ICER undercut both of Novartis’ estimates, the high cost/QALY of Spinraza in Type I SMA patients offers Novartis bargaining power with payers if the company can argue Spinraza use could be reduced or eliminated to offset total costs,” noted Leerink analyst Geoffrey Porges in a Dec. 21 report.

Novartis has made a major bet on complex but costly therapies like Zolgensma and its cancer cell therapy Kymriah (tisagenlecleucel). Such treatments hold out the promise of real benefit over current options, but the prices — cost-effective or not — could force a broader re-evaluation of how medicines are paid for.