By Denise Roland
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (November 30, 2019).
Novartis AG Chief Executive Vas Narasimhan has spent the past
two years buying up cutting-edge science. His latest deal is a
high-stakes bet that the Swiss health-care giant will succeed where
many have struggled: launching a new heart drug.
Cardiovascular diseases are the number-one cause of death in the
U.S., but new drugs for conditions like high cholesterol and heart
failure have proven tough to sell. They compete with a bevy of
older, cheaper drugs, and cardiologists typically want to see
evidence that patients benefit in the long run before fully
embracing them.
Novartis's own Entresto, for heart failure, has taken several
years to gain widespread acceptance among cardiologists. At $1.2
billion in the nine months to September, sales still fall well
short of the $5 billion a year that analysts predicted before the
drug's launch.
Dr. Narasimhan is wagering that the cholesterol drug at the
heart of the planned $9.7 billion acquisition of Medicines Co. will
do better, predicting that it could become what he calls a
"mega-blockbuster."
Investors cautiously welcomed the deal, sending shares up 1.2%
Monday, the day after the companies announced the deal. Graham
Parry, an analyst at Bank of America Merrill Lynch, said in a note
to clients that the drug would need to hit $3 billion to $4 billion
in peak annual sales to justify the price tag, which is a
challenging goal: Two similar drugs are forecast to peak at around
$2 billion a year.
The drug, inclisiran, uses an innovative approach to target a
protein implicated in the buildup of cholesterol. The two similar
drugs, Repatha and Praluent, that target the same protein have
failed to meet analysts' expectations as insurers balked at their
high price tags and threw up barriers to patients who wanted
them.
Two 2017 studies sponsored by Repatha-maker Amgen Inc. found
that around 80% of U.S. prescriptions for the two drugs were
initially rejected by insurers, and more than 50% were rejected
after appeals.
Dr. Narasimhan told analysts in a call that inclisiran can avoid
those pitfalls partly thanks to differences in how pharmacy and
hospital drugs are paid for in the U.S.
Inclisiran is given to patients by injection in hospitals,
whereas its two rivals, taken by self-injection, are dispensed at
pharmacies.
It is an important difference. Insurers can steer patients away
from pricier drugs at pharmacies by imposing higher copays or
heavier paperwork. They have fewer tools for controlling the use of
drugs given by doctors in hospitals.
At the same time, insurers can place restrictions on the use of
hospital drugs, too. One tactic, known as prior authorization,
requires patients to show that cheaper therapies don't work for
them before insurers grant access to newer, pricier drugs.
Insurers "can, if they want to, put some limitations in use,"
said Ed Schoonveld, managing partner for pharmaceutical value and
access at ZS Associates, a consulting firm.
That means the success of inclisiran -- expected to go on sale
in early 2021 -- will likely hinge on price.
Repatha and Praluent both went on sale at around $14,000 a year
but were later reduced to $5,850 to win acceptance from
insurers.
Dr. Narasimhan has said that Novartis would price inclisiran
within a range deemed fair for the two similar drugs. That range,
issued by the Institute for Clinical and Economic Review, a
nonprofit that reviews drug prices, was $4,500 to $8,000 a year for
patients at high risk of heart attacks or strokes.
The Novartis boss is also betting that physicians and patients
will prefer inclisiran because it only needs to be administered
twice a year, whereas Repatha and Praluent are taken once or twice
a month.
Doctors hope that means fewer doses will be missed, making the
drug more effective. "Even the most astute, aware patient struggles
with issues of adherence or compliance," said Clyde Yancy, chief of
cardiology at Northwestern University Feinberg School of Medicine
in Chicago.
Cardiologists also believe inclisiran could cause fewer side
effects. That is because it uses a precise technology that turns
off the undesirable protein at its source, by targeting the
molecular instructions for making it. Repatha and Praluent instead
disable the protein once it is made. A recently published trial
supported the notion of fewer side effects, but cardiologists would
like to see longer-term data to be sure, according to Dr.
Yancy.
Despite cardiologists' enthusiasm, some may hold off from
prescribing inclisiran until longer-term data shows whether its
ability to lower cholesterol also reduces the risk of a heart
attack or stroke. Cardiologists, who can manage patients for many
years, are typically more cautious than, say, cancer doctors who --
in dealing with what can be more immediate life-or-death situations
-- are sometimes more willing to try new drugs. That in turn has
pushed drugmakers to focus more on oncology.
In a survey of 50 cardiologists by investment bank Jefferies,
60% said they would wait until Medicines published the results from
a long-term trial, due in 2024, before prescribing inclisiran.
Dr. Narasimhan is braced for the challenges. "We do see a few
years of slow ramp and then we see significant uptake," he said.
"Our Entresto ramp took a few years. We hope to do better than
that."
Write to Denise Roland at Denise.Roland@wsj.com
(END) Dow Jones Newswires
November 30, 2019 02:47 ET (07:47 GMT)
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