Biogen halves the price of its Alzheimer’s drug

(AP)

Biogen is dramatically slashing the price of its Alzheimer’s treatment in a month and a half after debuting to widespread criticism at an initial cost that could reach $56,000 a year.

The drugmaker said on Monday it would cut the wholesale acquisition cost of the drug by about 50% next month. This means that the annual cost for an average weight person will be $28,200.

The actual amount that person would pay will depend on factors such as insurance coverage.

Biogen CEO Michel Vounatsos said in a prepared statement that too many patients were not being offered the drug due to “financial considerations” and that their disease had progressed beyond the point where Aduhelm could help them.

Aduhelm is the first in a line of new drugs that promise to do what no other Alzheimer’s disease treatment has done: slow the progression of the deadly disease that destroys the brain, rather than just managing its symptoms.

The drug received FDA approval in June, and the agency later said it was appropriate for patients with mild symptoms or an early stage of Alzheimer’s disease.

But Aduhelm’s debut was slowed by price concerns. Some insurers have been reluctant to pay for the drug, while medical centers across the country have been slow to decide whether to use the drug or said they have no plans to prescribe it at this time.

Doctors said concerns about the price were compounded by the costs patients would also face for the regular tests and scans needed to monitor their progress on Aduhelm.

The initial price has also been cited as a key factor behind planned premium increases for Medicare, the federal government’s coverage program for people aged 65 and older and for people with disabilities.

Last month, Medicare announced one of the biggest increases ever to its monthly “Part B” premium for outpatient care. He said he would increase the premium by almost $22, from $148.50 currently to $170.10 from January.

The agency said about half of that rise was due to the need for a contingency fund to cover Aduhelm. Medicare is expected to be one of the main payers of the drug.

Biogen said in October that Aduhelm only made $300,000 in sales in its first full quarter on the market. The company attributed the figure in part to drug wholesalers who reduced inventory they purchased in the prior quarter.

Aduhelm clears brain plaque thought to play a role in Alzheimer’s disease, and regulators made their appeal based on study results showing the drug appeared likely to benefit patients. But they asked for more research.

Biogen, which developed Aduhelm with Japan’s Eisai Co., said last week that the company plans to screen the first patients for the study in May. It will aim to recruit around 1,300 people with early-stage Alzheimer’s disease and expects to complete the research around four years after the study begins.

Biogen also said on Monday it would launch cost-cutting measures that are expected to generate about $500 million in annual savings, most of which will be realized next year. The company said it was cutting costs in part because Aduhem’s slow start was affecting its revenue.

Shares of Cambridge, Mass.-based Biogen Inc. fell in early trading along with broader markets.

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Eleanor C. William