Skip to main content

For the first time in nearly 20 years, the U.S. Food and Drug Administration (FDA) approved a drug that aims to treat Alzheimer’s disease. The drug made by Cambridge, Massachusetts-based Biogen will is named Aduhelm (Aducanumab) and includes a monthly intravenous infusion that aims to slow the decline in cognitive skills for people with Alzheimer’s.  

It’s the first treatment directed at the “underlying pathophysiology of Alzheimer’s disease, the presence of amyloid beta plaques in the brain,” says the FDA. The drug was developed in collaboration with the American arm of Japanese pharmaceutical company, Eisai 

Because scientists are divided on whether Aduhelm has been proven effective enough to warrant FDA approval, the decision is seen as one of the more controversial the FDA has made. The drug went through two Phase 3 trials that yielded differing results. As such, the drug was thoroughly rejected by an independent FDA panel in November and other scientists have spoken out against it.  

“Everyone wants a treatment that works for their patients, but it doesn’t mean you skimp on the evidence. This is pushing us in the wrong direction. If it is approved, it will slow down finding something that does work,” said Michael Greicius, MD, associate professor of neurology at Stanford University, according to an article in Neurology TodayGreicius is one among eight (of 11) panelists who voted against the drug back in November.  

The FDA was not under obligation to follow the panel’s guidance and decided to go ahead with approval despite the pushback. The regulatory agency acknowledged in a letter that Biogen’s submission included highly complex data and left residual uncertainties regarding clinical benefit. However, it said they decided to use the agency’s “Accelerated Approval pathway,” which intends to provide earlier access to potentially valuable therapies for patients with serious diseases where there is an unmet need.  

Patrizia Cavazzoni, MD, director of the FDA’s Center for Drug Evaluation and Research said on the agency’s website: “Currently available therapies only treat symptoms of the disease; this treatment option is the first therapy to target and affect the underlying disease process of Alzheimer’s. As we have learned from the fight against cancer, the accelerated approval pathway can bring therapies to patients faster while spurring more research and innovation.” 

Here are five things for health care CEOs to know about this drug approval.  

  1. It has a high price tag 

The price tag for Aduhelm? $56,000 per year—or $4,312 per infusion for a patient of 163 lbs.–the average weight of a U.S. patient with mild cognitive impairment (MCI) or mild dementia. In an interview with CNBC, Biogen CEO Michel Vounatsos said that the price tag was “fair” and promised to not have any hikes over the next four years. Wall Street analysts expected a price tag between $10,000 and $25,000, according to STAT 

The price of the drug and associated costs is expected to provide a financial windfall for Biogen, which has seen its multiple sclerosis drug, Tecfidera, get undercut by generic versions of the medication. If a quarter of eligible patients receive Aduhelm that would be $20 billion in revenue, according to an analysis in Reuters. The company saw a 43 percent boost in its stock on NASDAQ after the announcement. Biogen has said 1.5 million Americans are eligible for the treatment.  

The high price tag comes as at a time when Americans are clamoring for the government to intervene in lowering prescription drug prices. According to a survey from West Health, 8 in 10 Americans prefer major government action to control prices over concerns about it hurting innovation and competition from the pharmaceutical industry. 

Tim Lash, Chief Strategy Officer for West Health, said in a statement: “The time has come to finally enable Medicare negotiation. Americans are becoming increasing restless for it to happen even if the pharmaceutical companies are not.”  

  1. Uncertainty on how it will be covered

While the price tag for the drug is known, the way it will be covered by insurers has not been disclosed. Since most patients with Alzheimer’s are over the age of 65, the population most impacted by this new drug will be covered under Medicare. One expert from Cigna estimates that up to 90 percent of eligible patients will be covered by Medicare. 

Medicare has not yet indicated how it will cover the drug and associated costs. In a blog post on Health Affairs, Sean Dickson, JD, MPH, director of health policy at the West Health Policy Center; Amy Killelea, owner of Killelea Consulting; and Richard G. Frank, Professor of Health Economics at Harvard Medical School wrote an op-ed that said CMS needs to limit coverage and usage to only the most appropriate cases. 

In its press releasing announcing the price, Biogen said, “Patients who are covered by Medicare through a Medicare Advantage plan have a maximum annual out-of-pocket cap. Most traditional fee-for-service Medicare enrollees also have secondary coverage (e.g., Medicaid or a supplemental Medigap plan) that limits out-of-pocket expenses. Medicaid patients have nominal co-pays.” However, some insurers have said that it could cost up to $10,000 in annual out-of-pocket costs for the drug, according to The Wall Street Journal.  

Biogen said it entered into a value-based contract with Cigna and CVS Health to ensure access to the drug for patients. Steve Miller, MD Executive Vice President and Chief Clinical Officer at Cigna, said in a statement: “Given the known infrastructure challenges in the U.S., we are working to ensure that the patients who will benefit most from this new treatment have a clear path to access it.” Biogen also announced a collaboration with CVS on the same front.  

  1. It’s not out of the woods yet

The accelerated approval pathway from the FDA requires that Biogen conduct a post-approval confirmatory trial. If that trial does not verify the drug’s anticipated clinical benefit, FDA has regulatory procedures in place that could lead to removing the drug from the market. However, that process could take years to complete, and Biogen can sell Aduhelm in the meantime. Furthermore, FDA is not required to rescind its approval even if the trial shows the drug is not effective.  

Amy Abernethy, former Principal Deputy Commissioner at the FDA and currently the President of Verily’s Clinical Research Platforms, says that the accelerated pathway holds a lot of promise. “I’m an oncologist … so let me just say that out loud because to me the accelerated approved pathway has been critical to some of the spectacular progress we’ve made in cancer. So I see it as an interesting development here that signals part of where the future is headed,” says Abernethy.

Read more: Clinical research 2.0: An interview with Verily Life Sciences’ Amy Abernethy

  1. More controversy surrounds Aduhelm

In 2019, Biogen announced that it was halting two trials for the Aduhelm drug because it didn’t appear to benefit patients. This came after an independent review of the drug. At the time, it was called a “transformative failure” for Biogen by industry observers. However, in 2019, Biogen and Eisai said a “more detailed analysis showed patients in the earlier stages of the disease showed some benefit from the drug.” The companies pushed it for FDA approval after coming to that conclusion.  

Some advocacy groups have accused the FDA of working closely with Biogen and having that relationship influence the results. In December, non-profit government watchdog Public Citizen called for an investigation of the unprecedented and inappropriately close collaboration between Biogen and the FDA. The group put out a statement blasting the decision yesterday. 

“The close collaboration between the FDA and Biogen before and after the submission of the company’s marketing application for aducanumab dangerously compromised the integrity of the agency’s review and culminated in a biased agency assessment of the drug that discounted the results of the negative trial. The circumstances of this collaboration must be investigated by the U.S. Department of Health and Human Services Office of Inspector General,” said Michael Carome, MD, director of Public Citizen’s Health Research Group, in a statement.  

  1. This could be the beginning of a new era inAlzheimer’s drug development 

Advocacy groups associated with Alzheimer’s disease are more positive about the approval. The Alzheimer’s Association said that it was a new day in the battle to treat Alzheimer’s. Some, including the Alzheimer’s Drug Discovery Foundation, believe that this will be just the beginning of how the disease is treated. 

“Aducanumab is just the first of several Alzheimer’s drugs that will become available in the next five to 10 years,” Howard FillitMD, Founding Executive Director and Chief Science Officer at the Alzheimer’s Drug Discovery Foundation (ADDF), said in a statement. “The robust Alzheimer’s research pipeline, complemented by a growing number of biomarkers and other important research tools, means that the clinical trials underway today are more rigorous and more promising than ever.” 

Another pharma company, Eli Lilly, has an Alzheimer’s drug in development as well. The company won’t seek an accelerated U.S. review of this drug based on Phase 2 data after receiving advisement from the FDA. Eli Lilly saw a stock boost of 10 percent yesterday amid news of the approval of Aduhelm.