Pharma cos leaning on $850,000 therapy to justify super-expensive drugs

Global drugmakers are looking to a tiny biotech's $850,000 therapy for a rare type of blindness as a model for getting paid for highly expensive - and effective - new medicines.

Spark Therapeutics Inc plans to launch its recently approved Luxturna treatment for an inherited genetic mutation that causes blindness in March. The drug is to be administered only once, by injection, and Spark plans to charge $425,000 per eye, an unprecedented price.

But what is grabbing the attention of other drugmakers is not just what might be called an eye-popping price to treat a condition that Spark estimates affects 1,000 to 2,000 people in the United States, but the ways Spark is looking to help payers ranging from the federal government to private insurers absorb the drug's high cost, including spreading out payments over several years.

"We're laying the groundwork for the future of our pipeline and the future of one-time curative gene therapy treatments," Spark's chief executive officer, Jeffrey Marrazzo, said in an interview at the JPMorgan Healthcare Conference in San Francisco this week.

The high cost of prescription drugs has become an increasingly critical and contentious issue.

The independent Institute for Clinical and Economic Review (ICER) issued a report on Friday saying the proposed Luxturna price was far too high in most cases.

Healthcare spending accounts for 18 percent of the U. S. economy and has been rising faster than the rate of inflation as drugs and medical services costs increase. An influx of very expensive drugs that offer a one-time cure - such as a hepatitis C treatment from Gilead Sciences Inc - has already stretched state and federal budgets.
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