- Earlier this week, the National Institute for Health and Care Excellence (NICE) in the U.K. decided that AstraZeneca's ovarian cancer drug, Lynparza (olparib), is too expensive, and would therefore not be funded.
- Citing the need to reward innovation, AZ CEO Pascal Soriot is expressing some displeasure over NICE's move, saying that the U.K. is stifling innovation and "falling behind" when it comes to cancer care through its aggressive payer moves.
- Lynparza is a first-in-class drug for the treatment of ovarian cancer. It is part of a new class of drugs called PARP inhibitors, which are designed to target cancer cells while not affecting surrounding cells.
A closer look at the numbers tells an important story. Last year, UK-based AZ rejected Pfizer's $100 billion-plus acquisition overtures. At that point, Soriot reaffirmed AZ's independence and predicted that by 2023, AZ would be generating $45 billion per year in revenies.
At the same time, the National Health Service (NHS) and NICE in the U.K. are facing tremendous financial pressure in a system that is already overstressed and underfunded. Therefore, the $6,450 monthly cost of Lynparza, which extended life expectancy by 11 months in ovarian cancer patients in clinical trials with fewer side effects, seems too high for NICE to approve.
At this point, AZ has conceded that it will try to put together a pricing program for Lynparza, but Soriot has vowed that he and AZ will not be bullied.