Bluebird’s $2.8M Gene Therapy Becomes Most Expensive Drug After U.S. Approval

Signage is on display outside the Food and Drug Administration (FDA) headquarters in White Oak, Maryland, US, Aug. 29, 2020. REUTERS/Andrew Kelly/File Photo

Aug 17 (Reuters) – The U.S. Food and Drug Administration on Wednesday approved bluebird bios (BLUE.O) gene therapy for patients with a rare condition who required regular blood transfusions, costing the drugmaker a record $2.8 million.

The approval sent the company’s shares up 8% and is intended to treat beta thalassemia, which causes a lack of oxygen in the body and often leads to liver and heart problems.

The sickest patients, estimated to be up to 1,500 in the United States, require a blood transfusion every two to five weeks.

The therapy, which will be branded as Zynteglo, is expected to face some resistance from insurers due to its steep price, analysts say.

Gene therapies usually carry a high price tag, as they are often curative and have faced hurdles in obtaining insurance coverage.

For example, Novartis (NOVN.S) was forced to offer discounts and work out “result-based” installment payments for its $2.1 million Zolgensma therapy in 2019 after insurers rejected the drug’s price.

Bluebird has proposed Zynteglo as a potential one-time treatment that could eliminate the need for transfusions, leading to long-term savings for patients.

The average cost of transfusions over the lifetime could be $6.4 million, Chief Operating Officer Tom Klima told Reuters before the approval. “We believe that the prices we are considering are still of great value to patients.”

Bluebird is in talks with insurers about a one-time payment option.

“Possibly up to 80% of that reimbursement will be reimbursed if a patient does not achieve transfusion independence, which they (insurers) are very excited about,” Klima said.

The FDA warned of a potential risk of blood cancer with the treatment, but noted that there were no such cases in studies.

Bluebird expects to start the treatment process for patients in the fourth quarter. However, no revenues are expected from the therapy in 2022, as the treatment cycle would average 70 to 90 days from initial cell collection to final transfusion.

Reporting by Mrinalika Roy in Bengaluru; Editing by Aditya Soni

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