Wednesday, April 25, 2007

Pricing of Pfizer's Maraviroc

The FDA advisory committee approval of Pfizer's CCR5 pathway-based HIV drug Maraviroc was widely covered in the media. While analysts and doctors seem to agree that this is a novel class of therapy, there is a wide range of estimates in terms of the product's commercial potential. According to CNN, analyst Les Funtleyder of Miller Tabak estimates 2011 sales at $200 million while analyst Barbara Ryan of Deutsche Bank estimates the same at $500 million.

Pharmalyst was curious regarding the huge variability in estimates and decided to take explore the numbers in this post. The wide range is not surprising given that Pfizer has not released any pricing information about the product. Further, as Pharmalyst read more about the product, the number of patients too could change as further trials and safety information emerge.

According to WSJ (subscription):

"Pfizer has proposed using maraviroc in patients with advanced HIV infection or AIDS who have failed treatment with other drugs, which is estimated at about 40,000 patients in the U.S."

This use of the product as a drug of last resort would suggest to Pharmalyst that Pfizer would probably look at pricing this like some of the oncology drugs (Avastin $47,000 per year, Nexavar & Sutent at $45,000 per year according to WSJ (subscription)). However this kind of pricing would definitely prevent this product from being considered for the first-line cocktail of HIV drugs. It appears to Pharmalyst that Pfizer probably would like to maximize total revenue by expanding Maraviroc's patient population. According to a background article in NYT (registration):

"About 85 percent of newly infected patients have a virus that uses CCR5 while only about half of highly drug-resistant viruses use that portal. "

To get the product adopted in early-stage patients , Pfizer will perhaps opt for much lower pricing (given that there are several alternatives for early-stage patients). From the recent Abbott v Thailand saga, we know that a years supply of Kaletra in the US costs around $7000. So Pharmalyst would like to speculate that Pfizer's initial pricing for this drug would be somewhere between $7,000 and $40,000. Despite the potential PR hit, Roche priced its HIV drug Fuzeon at $20,000.

Given that there are still safety concerns over Maraviroc and it has not been reported to be a product with manufacturing difficulties (unlike Fuzeon), Pharmalyst guesses that Pfizer will price this somewhere around $13,000 to 15,000 initially. This price is higher than the price of current therapies but will gladly represent value to patients for whom existing therapies are not working. Over time, if there are no liver/other safety issues with this drug, it could be a standard part of the early-stage cocktails for patients with the CCR5 strain. In that case, Pfizer would probably drop the price further in line with the price of existing therapies.

Pharmalyst welcomes readers opinions regarding the pricing of this drug.


Anonymous said...

miraviroc will probably be about 10,000.00 per year similar to Roche's T20 injectable drug. This is in addition to 2 or 3 other HIV drugs with a total cost of about 30,000.00 per yr not including other products and tests. Speaking of tests each patient will be required to have a trofile assay from Monogram to see if they can safely take miraviroc. The cost of this test not including clinic visits will be about 1000.00 and has a 3 week turn around time. In trials about half of those who needed miraviroc were unable to take it safely due to having the x4 which shows up in advanced HIV patients. It is unclear how Pfizer intends to market this product given its close ties to Monogram and the cost of testing...who will pay for the test? will it be bundled as one product? Since the trofile test is not FDA approved or regulated it seems it should be a seperate test much like other testing that happens regularly for HIV patients. It is also unclear how often you must have the trofile test and it only works when a patient stops reponding to therapy. There is also an issue surrounding what will happen if during therapy they develop the x4 which is contraindicated for the start of therapy. I can only hope the FDA will examine these issues closely. The drug to watch in a new class of HIV therapy will be Merck's integrase inhibitor less toxicities no testing and great clinical data.

Pharmalyst said...

Thank you for your comment. I do agree that the monogram testing part is unclear. The Merck integrase inhibitor will be the one to watch for sure. I believe some analysts are already predicting sales of 1B.

Anonymous said...

In response to the previous comment, t-20 is priced at around $20,000, NOT $10,000 are you suggest. So are you saying you think maraviroc will cost the same ($20,000) or half of T-20 ($10,000)?

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