Biogen cuts the price tag on its Alzheimer’s drug in half

Biogen is slashing the price of its Alzheimer’s treatment in half months after it debuted to widespread criticism for an initial cost that could reach $56,000 annually.

The drugmaker said today that it will cut the wholesale acquisition cost of the drug by about 50% next month. That means the annual cost for a person of average weight will amount to $28,200.

The actual amount that person would pay will depend on factors like insurance coverage.

Biogen CEO Michel Vounatsos said in a prepared statement that too many patients were not being offered the drug due to “financial considerations,” and their disease had progressed beyond the point where Aduhelm could help.

Aduhelm is the first in a line of new drugs that promise to do what no other Alzheimer’s treatment has managed: slow the progress of the fatal brain-destroying disease, rather than just managing its symptoms.

The drug received FDA approval in June, and the agency later said it was appropriate for patients with mild symptoms or early-stage Alzheimer’s.

But Aduhelm’s debut has been slowed by concerns over the price. Some insurers have balked at paying for the drug, while medical centers across the country have been either slow to decide on using the drug or said they weren’t planning to prescribe it for now.

Doctors have said concerns over the price were compounded by costs patients also would face for regular testing and scans needed to monitor their progress on Aduhelm.

The initial price also has been cited as a key factor behind planned premium hikes for Medicare, the federal government’s coverage program for people ages 65 and older and for the disabled.

Last month, Medicare announced one of the largest increases ever in its “Part B” monthly premium for outpatient care. It said it would raise the premium nearly $22, from $148.50 currently to $170.10 starting in January.

The agency said about half of that hike was due to the need for a contingency fund to cover Aduhelm. Medicare is expected to be one main payers for the drug.

Biogen said in October that Aduhelm had brought in only $300,000 in sales during its first full quarter on the market. The company attributed that figure partly to drug wholesalers drawing down inventory they had purchased the previous quarter.

Aduhelm clears brain plaque thought to play a role in Alzheimer’s disease, and regulators made their call based on study results showing the drug seemed likely to benefit patients. But they’ve asked for more research.

Biogen, which developed Aduhelm with Japan’s Eisai Co., said last week the company expects to screen the first patients for that study in May. It will aim to enroll about 1,300 people with early-stage Alzheimer’s and expects to complete the research about four years after the study begins.

Biogen also said today that it will start some cost-cutting measures that are expected to yield about $500 million in annual savings, most of which will be realized next year. The company said it was cutting costs in part because the slow debut of Aduhem was affecting its revenue.

Shares of Biogen Inc., based in Cambridge, Mass., slipped in early trading along with broader markets.