The Institute for Clinical and Economic Review (ICER) had a busy day Thursday, issuing final cost assessments on two highly anticipated neurology drugs: Spravato, the inhalable depression treatment from Johnson & Johnson’s Janssen, and Novartis’ Mayzent to treat secondary progressive multiple sclerosis (SPMS).
The bottom line? Neither treatment is cost effective, ICER said.
The agency weighed in first on Mayzent, which was approved by the FDA in March and priced at $88,500 per year. When ICER applied its usual analysis method to the drug—cost per life years gained—it determined that Mayzent exceeds its maximum threshold of $150,000. In fact, the drug would cost $1.57 million per life year gained, the final report said (PDF).
The Novartis product “contributes substantial costs without providing a meaningful extension of life relative to best supportive care,” ICER said in a summary of its assessment (PDF).
A spokesperson for Novartis told FiercePharma that the company provided feedback and recommendations to ICER during the review process but that those “are not fully reflected in the final report.” He noted that ICER established cost effectiveness by comparing it to no treatment, when in fact most SPMS patients are treated with some form of therapy.
The spokesperson added that the phase 3 trial for Mayzent “demonstrated a significant effect in delaying disability progression in a representative SPMS population.”
ICER’s conclusion could complicate what was already a massive marketing challenge for Novartis. An estimated 80% of patients with relapsing-remitting MS develop SPMS, but physicians often fail to diagnose it, or if they do, they ignore it because of a lack of effective treatments.
But what bothered ICER even more was that Mayzent seemed to be not all that different than Gilenya, Novartis’ blockbuster MS treatment, which has faced multiple patent challenges in recent years. “Evidence and clinical testimony suggested that [Mayzent] does not have a unique role in therapy for any phenotype of MS, including active SPMS,” ICER said in a statement. It went on to recommend that when Gilenya does eventually go generic, payers should grant preferred formulary status to it and not to the pricey Novartis newcomer.
Moments later, ICER took a swat at Janssen, saying at the top of a news release that it thinks the company needs to shave 25% to 52% off the price of depression spray Spravato to make it cost effective. At its current list price of $32,400 per year, its cost-effectiveness ratio exceeds $175,000 per quality-adjusted life year gained, making it too expensive, ICER said.
A spokesperson for Janssen told FiercePharma in an email that the company disagrees with ICER’s assessment, which “underestimates the proven short- and long-term benefits” of the product, she said. “Furthermore, the inaccurate assumptions in the report on the established positive benefit-risk profile of Spravato are misguided.”
Spravato is a reformulation of “party drug” ketamine that nabbed FDA approval for treatment-resistant depression in March. Even though the FDA required a controlled launch due to safety risks, analysts had high hopes for the drug. Jefferies analysts, for example, predicted it could reach $3 billion in peak sales.
But J&J didn’t perform clinical trials that directly compared the drug to existing products, and that irked the reviewers at ICER. The agency’s chief medical officer, David Rind, M.D., said in the statement that effective solutions to treatment-resistant depression “are badly needed,” but that he does not understand “how a price exceeding usual cost-effectiveness thresholds is appropriate for a treatment that could be very widely used, particularly when that price is an order of magnitude higher than that of intravenous generic ketamine, a closely related therapy.”
ICER determined that the total cost of Spravato in the first year would be $36,500 versus just $3,600 for ketamine. Even if only 16% of eligible patients were to receive the J&J drug, it would have an impact on the healthcare budget of more than $819 million—ICER’s threshold for new medicines.
That was enough for ICER to issue an “access and affordability” alert on Spravato. It suggested in a summary document (PDF) that trials comparing the drug to other treatment options be conducted and that payers restrict access to the product with prior-authorization requirements, in light of “the considerable uncertainty that remains regarding the longer-term benefits and risks of esketamine,” ICER said.
Editor’s note: This story has been updated to incorporate comments from Novartis.