BioPharma, Pharma

Biogen slashes price of Alzheimer’s drug by half as CMS coverage decision looms

The price of Biogen Alzheimer’s disease drug Aduhelm will be cut in half at the start of 2022, a move that comes as a Medicare recommendation on coverage is expected early next year. Meanwhile, Biogen is preparing corporate measures projected to save $500 million annually, cost-cutting made necessary in part due to slow market uptake of Aduhelm.


Prescriptions and insurance coverage of Alzheimer’s disease drug Aduhelm have been slow, and drugmaker Biogen is slashing the therapy’s price in half in an effort to move the needle on sales. The price cut comes as a Center for Medicare and Medicaid Services decision on coverage of the drug looms in 2022.

When Aduhelm received accelerated approval in June, Biogen set a wholesale price of about $56,000 a year. The drug’s dose is determined by patient weight. For the average weight of 74 kg (about 163 pounds), Aduhelm’s new wholesale price will be $28,200. The price change will take effect on Jan. 1.

Aduhelm is an antibody designed to clear away amyloid plaques from the brain. The drug’s approval covers its use in patients with mild Alzheimer’s or mild dementia—before the disease has advanced. Of the approximately 5.8 million Americans who have Alzheimer’s, an estimated 1 million to 2 million people have the mild cognitive impairment or mild dementia that would qualify for treatment with the Biogen drug. But sales have been slow. Financial reports show that third quarter sales of the drug totaled just $300,000 in the third quarter.

Biogen took heat for Aduhelm’s price tag. The Institute for Clinical and Economic Review (ICER), a drug pricing watchdog group, said in an August report that there is inadequate evidence of Aduhelm’s benefit and it recommended a lower price to avoid the strain that financial burden the drug would place on the Center for Medicare and Medicaid Services and the budgets of patients. Given the uncertainty of the drug’s benefit, ICER proposed an annual price in the range of $3,000 to $8,000.

Aduhelm’s new price in the U.S. is still well above ICER’s preferred cost. But Biogen framed the price cut as a way to improve access to its new drug. With insurance coverage and access to the diagnostics and specialized centers that can administer the therapy, Biogen said it estimates that 50,000 patients may start treatment with Aduhelm in 2022. In the Monday announcement, Biogen CEO Michel Vounatsos said that too many patients are not being offered Aduhelm due to financial considerations, and the disease in these patients is progressing beyond the point where they can benefit from treatment. He added that the challenge of providing patients access to the new drug “must be addressed in a way that is perceived to be sustainable for the U.S. healthcare system.”

CMS is currently evaluating coverage of Aduhelm. A proposed decision memo from the agency is due on Jan. 12; the final decision is expected three months later. But Biogen’s price cut comes after CMS already baked the drug’s costs into premiums for next year. Aduhelm falls under Medicare part B, which covers physician services, outpatient services, durable equipment, and prescription drugs. By law, Medicare premiums must cover 25% of the estimated Part B costs of enrollees 65 and older.

Last month, CMS said the minimum premiums next year would increase by 14.5%, a hike the agency attributed in part to the rising cost of covering prescription drugs, citing in particular the uncertainty about coverage of Aduhelm. CMS is required to set aside a contingency reserve to cover spending increases, including drug costs.

Clinical evidence of Aduhelm’s benefit is on the way, but it won’t be available anytime soon. Last week, Biogen revealed plans for the post-marketing clinical trial that is requirement of the drug’s accelerated approval. That global study is projected to take about four years. But uncertainty surrounding the drug is already weighing on its prospects in other markets. Last week, the European Medicines Agency recommended refusal of Biogen’s application for marketing authorization, citing the lack of a link between amyloid reduction and patient improvement, as well as safety risks from brain swelling and bleeding. Biogen said it would appeal the agency’s opinion.

In the meantime, Biogen is preparing to cut costs throughout the company. It said these measures are needed because of generic multiple sclerosis therapies entering the market that will erode sales of the MS drugs that are currently the firm’s top-selling products, as well as the slow market uptake of Aduhelm. Biogen projects the moves will save about $500 million annually. The company said details are being finalized and will be disclosed in the first quarter of 2022.

Photo: IvelinRadkov, Getty Images