The Swiss pharmaceutical company Novartis will sell its new prostate cancer drug Pluvicto only privately if healthcare systems continue to refuse to pay the high price. This highlights the challenge of expanding access to innovative but expensive new treatments.
Pluvicto is part of a new generation of so-called 'radiopharmaceuticals,' which can enable cancer patients to live longer but are expensive to manufacture due to complex supply chains. The list price of the drug in the USA is approximately USD 42,500 per dose, with a treatment cycle encompassing up to six doses. However, the drug is not offered in some European healthcare systems.
Harry Kirsch, CFO of Novartis, told the Financial Times that the complexity of the product does not allow the Swiss pharmaceutical company to significantly lower the price. "We have to stick to the minimum price: This [medication] is not easy to manufacture and deliver," he said. "If the respective country and healthcare system cannot [pay] the price we need, we offer it on the private market where it is well received.
Our goal, of course, is to get reimbursed so that this product is available to every eligible patient, but we also need to protect the value of our investment," he added.
Here is the translation of the heading to English:
"Sales of the drug increased by 45 percent to 655 million USD in the six months up to the end of June, reported Novartis on Thursday, with 522 million USD in the USA. However, the sales in the second quarter – a 44 percent increase – were below analysts' expectations. Kirsch said that Novartis needs to educate medical professionals about the benefits of the treatment to increase referrals.
The stocks fell by 3.6 percent in early afternoon trading on Thursday.
Pluvicto is a highly specific form of radiation therapy for advanced prostate cancer. It contains a targeted compound that seeks out and binds to cancer cells, and a radioactive component that kills them. Clinical studies show that patients taking the medication live longer without their condition worsening, compared to current treatments.
Pluvicto uses Lutetium-177, a radioactive isotope with a short half-life, which means it must be used within days after production at Novartis locations in the USA, Italy, and Spain. Consequently, the drug faced supply shortages and was placed on a US shortage list last year. Kirsch stated that the company now has an "unrestricted" supply after opening a new facility in Indiana.
The medication was approved by the British Medicines and Healthcare products Regulatory Agency (MHRA) and the European Commission. But not all European countries offer the treatment. Germany announced this month that the medication would be reimbursed by statutory health insurance at a price of more than 150,000 euros per year. However, the British health authority recommended in November not to offer the medication in the NHS. They were uncertain about the cost-effectiveness compared to current treatments.
Kirsch said the company has led recent developments in precise radiation therapy. However, it faces competition from other pharmaceutical giants that have recently entered this sector. AstraZeneca recently acquired the radiation therapy company Fusion Pharmaceuticals for USD 2.4 billion, while Bristol Myers Squibb and Eli Lilly also acquired biotech companies in this sector last year.
On Thursday, Novartis raised its annual forecast after sales of its heart failure, psoriasis, and cancer drugs exceeded expectations in the first half of the year. Sales rose 11 percent in constant currency to $12.5 billion, and net profit increased by 45 percent to $3.2 billion, both exceeding expectations.
The company now expects an operating core profit in the mid to high ten percent range, compared to the previous estimate of around 10 to 13 percent.
