Goldman Sachs initiated coverage on GW Pharmaceuticals PLC- ADR (NASDAQ:GWPH) with a “Buy” rating and price target of $189. Four other groups lately updated their coverage. The target range as noted from the released reports is from $135 to $208. The firm’s lead product candidate is ‘Epidiolex’ for the cure of epilepsy. It anticipates to submit its U.S. marketing application in the upcoming period.
An emerging stringent payer line on new medications for rare diseases should pose questions about the strategy of firms that have put their investment cases on robust pricing power. Anthem Inc (NYSE:ANTM) choice this month to restrict coverage of Spinraza is as per its earlier decision to not to pay for Exondys 51. Both are therapies for rare degenerative disorders in kids.
This ought to increase some worries about market entree for late-stage orphan drug contenders being advanced by firms like GW Pharmaceuticals, bluebird bio Inc (NASDAQ:BLUE), BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) and Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY), 11 agents with total anticipated sales of $6 billion will reach Phase 3 or regulatory achievements this year.
The FDA’s broad nod for Spinraza in spinal muscular atrophy kicked the question of subject eligibility to payers. Anthem has determined to restrict its use to subjects confirmed to have definite SMN mutations and who showed SMA indications before they were 6 months old, mainly meeting the findings of clinical studies conducted by Biogen.
With a price tag of $125,000 per injection, Spinraza was sure to draw scrutiny. In earlier years, the relative scarcity of SMA, EU prevalence is expected at 20,000 people, might have convinced payers to be easy on it after evaluation. But heightened sensitivity related to drug costs has encouraged payers to test the price of even rare disease medications.
This is led in no small part by the particular sector’s movement to rare disease agents as in the past they have provided a healthier return on investment.