Dive Brief:
- The nonprofit healthcare research firm Institute for Clinical and Economic Review (ICER) says that Novartis' Entresto, an expected blockbuster heart failure medication that was approved in July, should cost about 17% less than it does in order to prevent excess strain on the U.S. healthcare system.
- Entresto is priced at $12.50 per day, or just under $4,600 per year.
- ICER recommends a price of $3,780 per year—but the group also admitted that such a cost reduction could easily be achieved after negotiations with government and private payers.
Dive Insight:
Back when Entresto nabbed an early FDA approval in July, BioPharma Dive reported that the drug would likely be one of Novartis' biggest launches ever. The firm believes that more than 2 million of the 5.1 million Americans living with heart failure could qualify for treatment with the therapy, and analysts have predicted that Entresto could eventually bring in anywhere from $6 billion to a staggering $8 billion in annual sales (at the upper end of the spectrum).
The question was whether or not the drug, at $12.50 per day, would prove too pricey. And although the ICER report does recommend a 17% haircut on Entresto's cost due to concerns over costs to the overall healthcare system, that's not anywhere near what the firm has recommended for ultra-pricey meds, such as Amgen's and Sanofi/Regeneron's PCSK9 inhibitor cholesterol-lowering drugs. ICER concluded that those medications should actually cost somewhere from 65% less to more than 70% less than their list prices.
All told, after the process of negotiating discounts and rebates with insurers concludes, Entresto could easily fall in line with ICER's recommendations. And the reason is that the drug's demonstrated benefit in trials is significant enough, and Entresto was priced reasonably enough by Novartis, that the group concluded that Entresto presented a benefit over older medications and could be considered "cost-effective."