Gene therapy for blindness to cost $850,000

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Image: A doctor checks the eyes of a patient who received a blindess gene therapy treatment

Dr. Albert Maguire, right, checks the eyes of Misa Kaabali, 8, at the Children’s Hospital of Philadelphia on Oct. 4, 2017. Misa was 4-years-old when he received his gene therapy treatment. Bill West / AP file

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Luxturna was just approved by the Food and Drug Administration last month after

a dramatic hearing where teenagers spoke of seeing the stars in the night sky for the first time in years and at which eye doctors with no links to the company or the drug pleaded for its approval.

It’s the first true gene therapy approved in the U.S. for an inherited genetic disease — vision loss caused by mutations in a gene called RPE65. It’s very rare, affecting only a few thousand people in the U.S.

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The mutation causes the gradual disruption of the cells located in the back of the eye that form the retina. Patients gradually lose their vision and go blind. There’s no cure now.

The treatment involves injecting a modified cold virus — one called an adeno-associated virus — directly into the eye to deliver corrected genes to the retina.

Surprisingly, a single treatment helped most of the 21 volunteers who got it, reversing vision loss almost immediately.

Drug companies usually make money by selling drugs over and over again to the same patients and to new patients. For instance, cholesterol-lowering drugs must be taken daily for life and they are taken by millions of people.

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But how does a company make money on a one-time drug that costs so much to prepare?

Spark Therapeutics, which makes Luxturna, says it has a plan.

“We have been working with stakeholders across the health care sector to help ensure that appropriate patients have access to a product that challenges all of the current conventions of how patients are treated, how products are delivered and how payments are handled,” said Jeffrey Marrazzo, chief executive officer of Spark Therapeutics.

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“Over these past few months, we have been working with health insurers to create innovative pathways for access to Luxturna that may serve as models for other one-time administered gene therapies in the future,” Marrazzo said in a statement.

“Our work is not done, but we believe that the offerings we are announcing today will help ensure that eligible U.S. patients have the coverage and financial support they need to gain access to both Luxturna and the specialized medical care required to deliver the product at treatment centers.”

For instance, it’s negotiated an agreement to refund money to Harvard Pilgrim, a not-for-profit health services company, if patients don’t get better vision long-term.

And it’s in negotiations with the Centers for Medicare and Medicaid Services, the federal government health insurance agency, to come up with ways to let insurers pay by installments.

“We are also eager to work with CMS to enable more meaningful rebates as part of the pay-for-performance model,” Marrazzo said.

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“It’s wildly expensive but, to be very frank, I think they’ve priced it what I’ll call responsibly,” Dr. Steve Miller, chief medical officer of pharmacy benefits manager Express Scripts,

told CNBC.

“The product is just phenomenally innovative, and we’ve been talking about gene therapy for over 20 years; we’re now at the threshold of having gene therapy reaching patients.”

Express Scripts has a deal with Spark to distribute Luxturna.

“We’ve got to figure this out, because — let’s be frank — there are going to be more of these drugs coming to the marketplace for even bigger populations,” Miller said.

Another company making pricey treatments has a plan to offer rebates if patients don’t get better. Novartis announced in August that it had made a deal with CMS, that it

would not charge for patients who did not respond within the first month to its cancer therapy Kymriah, which costs $475,000 per treatment.

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