Will Vertex finally become profitable after FDA approval for CF drug Orkambi?
- Vertex's Orkambi combines Kalydeco (ivacaftor), which is is intended to treat several cystic fibrosis (CF) transmembrane conductase inhibitor (CF-TR) mutations, with ivacaftor, which treats the F508del genetic mutation.
- The FDA approved the drug over the weekend, and the cost of the new therapy is $259,000 per patient per year.
- While Orkambi is not a cure, it counteracts CF-related lung damage, resulting in fewer infections and less build-up of mucus. This drug is intended to treat 8,500 people with CF. (Note: Roughly 30,000 people in the U.S. have CF.)
At $259,000 per year, Orkambi is still less expensive than Kalydeco, which costs $300,000 per year and can only treat roughly 2,000 of the people with CF in the U.S. While the approval is being hailed as a positive development in the CF community and at Vertex, the pressure is on.
The company needs to show a profit to justify the $53 million in retention bonuses that it gave out to top execs in June—a move that elicited a protest vote from shareholders considering that the firm has not been profitable in years. And of course, there continues to be contention around pricing, not unlike the controversy surrounding specialty drugs in general.
Vertex will start shipping Orkambi to specialty pharmacies within the next several days.