Novartis AG Sees Price War With Amgen, Eli Lilly for Blockbuster Psoriasis Market

Novartis AG Sees Price War With Amgen, Eli Lilly for Blockuster Psoriasis Market
January 28, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor

In order to head off a price war with payers similar to the one being fought over hepatitis C drugs, Novartis AG told Bloomberg this week that it will price its promising new psoriasis treatment, Cosentyx, at a price similar to Johnson & Johnson ’s Stelara, its main competitor, said David Epstein, head of Novartis’s pharmaceuticals division.

Lowering its prices is not a new concept for Novartis, Epstein said.

“The idea of price increases in most of the world is over anyway,” Epstein said. “In Europe I seldom if ever get a price increase. Even in the U.S. market, once there’s direct competitors it will certainly become more challenging to take price increases.”

Epstein said Novartis is keeping a close eye on new psoriasis products from Eli Lilly and Company and Amgen , which could push prices for drugs that treat the disease down even further. Stelara currently costs around $7,661 per injection, with around six doses recommend in the first year, which adds up to a whopping $45,966 annually.

“When Amgen launches and Lilly launches, assuming they do, that will give payers more leverage to negotiate price discounts, and I think that’s exactly what’s going to happen,” Epstein told the news service.

Analysts have projected that Cosentyx (secukinumab) could rake in as much as $1.06 billion by 2019, while Lilly’s ixekizumab could pull in $558 million, and Amgen’s and AstraZeneca PLC ’s brodalumab $432 million.

“Hopefully in the time between now and then we will have established a physician community and a patient community that likes our product. We will then fight with them for market share, even if there’s pricing pressure,” he said

Amgen spokeswoman Eva Groves said the company “can’t speculate on future pricing” for its psoriasis drug, brodalumab, while Lilly declined to comment.

Epstein told Bloomberg that even with more competition, the markets for psoriasis and two other diseases for which Novartis is seeking approval for Cosentyx could add up to $10 billion, with a growth rate of 22 percent annually. Cosentyx belongs to a new type of drugs known as interleukin inhibitors, which interfere with the inflammatory IL-17A receptor, thus reducing the severity of psoriasis, according to the U.S. Food and Drug Administration. Around 7.5 million American live with the autoimmune disease.


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