A Food and Drug Administration advisory panel Tuesday recommended approving a new treatment for cystic fibrosis. Experts say the drug will reap billions for its manufacturer. The price of the medication will easily eclipse that of Gilead's $80,000 hepatitis C breakthrough drug, Sovaldi.
The FDA's Pulmonary-Allergy Drugs Advisory Committee voted 12-1 to recommend approval of Vertex Pharmaceutical's drug Orkambi, a therapy that combines the already approved medication for cystic fibrosis, Kalydeco, with a newly developed medication called lumacaftor to treat the most common genetic mutation that causes cystic fibrosis.
“Today's positive recommendation brings the cystic fibrosis community one step closer to potential approval of the first medicine to treat the underlying cause of this disease for many more people," said Vertex's executive vice president and chief medical officer, Dr. Jeffrey Chodakewitz, in a released statement.
The drug would treat an estimated 8,500 of the 30,000 patients with CF in the U.S., according to documents released prior to the meeting (PDF). Estimated to affect 70,000 patients worldwide, cystic fibrosis is a life-threatening genetic condition that causes cells to secrete bodily fluids that become thick, blocking passageways in the lungs and pancreas.
Kalydeco currently treats an estimated 2,000 patients who have a rarer form of the disease than the one Orkambi would treat.
Conclusions from the committee's report on Orkambi suggest there are questions regarding one of the medication's benefits toward improving lung function. A clinical trial involving more than 1,000 patients showed the two-drug combination therapy resulted in modest improvement of lung function, with investigators stating, “The contribution of lumacaftor to the efficacy of the proposed combination products has not been shown.”
Approval of Orkambi is vital for Cambridge, Mass.-based Vertex, which has posted a net loss of more than $198 million for the first quarter of 2015. Sales of Kalydeco, currently its only drug on the market, reached $130 million during the first quarter, ended March 31.
“With this launch, they'll get to profitability almost instantaneously,” said Katherine Xu, a partner with the equity research firm William Blair & Co. who analyzes Vertex. “It's a tremendous opportunity for them.”
Analysts have estimated sales of Orkambi could reach as high as $8 billion worldwide, though questions remain as to what price the company will place on the drug if it gets approved. Many feel the cost of the treatment will match the price of Kalydeco, which costs around $300,000 for a year's worth of treatment.
Xu says the price Vertex ultimately sets for Orkambi will be determined by a number of factors that set it apart from its other medication, Kalydeco, an orphan drug whose price is high, in part, due to the small population the medication treats. Xu has estimated the initial price for Orkambi to be in the range of $200,000 to $300,000 per patient annually. A larger pool of potential patients usually helps bring down the cost of a drug, but the fact that the drug is a combination of two compounds, one of which is already being sold, may cause the initial price to be higher.
“You're adding a drug to the existing drug in this case,” Xu said. “So, are you going to add a drug and then set a lower price? We just haven't seen that kind of precedent before.”
The FDA is scheduled to issue its decision on Orkambi's approval on July 5. In such cases, the agency tends to follow the panel's recommendation, but it has been known to occasionally deviate from the position of its advisory body.
