Spark Therapeutics ( ONCE ) and GlaxoSmithKline ( GSK ) are pricing the world's first approved gene therapies at figures approaching $1 million apiece, but some expected even higher charges, reports said Wednesday.
[ibd-display-video id=3060740 width=50 float=left autostart=true] Spark's Luxturna treats a rare eye disease that causes blindness . Its $425,000 price tag per eye puts it at a total cost of $850,000 for both eyes - yet that was still below many analysts' views that Spark could price its gene therapy above $1 million.
Glaxo's drug, Strimvelis, is approved in Europe to treat an immunodeficiency disease often referred to as "bubble-boy disease" in children. It costs about $714,000. On Wednesday, a U.K. institute recommended Strimvelis as cost effective, Bloomberg said .
Gene therapies are meant to be one-time treatments, which makes the question of pricing tricky. Both therapies from Spark and Glaxo treat small patient populations.
Spark outlined its thinking on Luxturna pricing in an email to Investor's Business Daily.
"The price reflects the stakeholder considerations we have learned about these past months, including access concerns of patients, families, health care providers and treatment centers; budgetary concerns of public and private payers; and our need to build a sustainable company that addresses the unmet needs of patients with genetic diseases," Spark said.
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In addition to unveiling the price for Luxturna, Spark also detailed a series of payer models and programs to help patients access the drug including an outcomes-based rebate arrangement with Harvard Pilgrim and a contracting model with Express Scripts ( ESRX ).
The contracting model aims to reduce costs to payers. Commercial payers or their pharmacies purchase Luxturna - rather than the treatment centers - and agree to cover treatment for their members, expedite benefits processing and cap out-of-pocket amounts at in-network limits.
Under the arrangement, Spark assumes all drug in-transit, storage and handling risks.
Spark is also in discussions with the Centers for Medicare and Medicaid Services on a proposal that would enable the company to offer payers the option to spread payment for Luxturna out over multiple years, which provides flexibility for greater outcomes-based rebates.
Spark also created a support system to help patients navigate the insurance process, provide travel and accommodation help, and assist with other out-of-pocket costs related to treatment.
By the closing bell on the stock market today , Spark jumped 4.6% to close at 55.76. Glaxo slipped fractionally to 36.79.