Novartis is Making its Cancer Cure Affordable. It's Not Just Being Nice.

Convershaken Staff
September 1, 2017

Novartis has won regulatory approval for Kymriah, a revolutionary therapy for leukaemia patients. The drug giant plans to provide financial assistance to uninsured and underinsured patients, and only charge them if they respond to Kymriah in the first month of treatment. Those policies are undeniably generous, but also self-serving: they show Novartis' confidence in its offering and encourage usage, cowing rivals and cementing its first-mover advantage.

Kymriah is the first treatment approved by the Food and Drug Administration (FDA) that genetically alters a patient's cells to combat cancer. T-cells - white blood cells that seek and destroy cancer cells - are extracted from the patient and shipped to Novartis' facility in New Jersey. Next, they're genetically modified to produce chimeric antigen receptors (CARs) that can identify unique proteins on cancer cells and trigger T-cells to destroy them, grown in large numbers, shipped back and infused back into the patient. The process typically takes around 22 days. The modified cells multiply by themselves, effectively immunising the patient against the particular cancer they're designed to wipe out.

The FDA has only approved Kymriah for use in children and adults aged 25 and under with a particular form of leukaemia, which has resisted treatment or has relapsed at least twice. Even with chemotherapy, radiation and stem cell transplants, less than 10% of the target population survive five years. The FDA gave the green light after 52 out of 63 patients - 83% - in a clinical trial experienced complete remission within three months of infusion. However, several patients suffered severe side effects such as fever, low blood pressure and neurological damage. Given these risks, the FDA has initially restricted use of Kymriah to certified medical centres - Novartis anticipates there will be 32 before the new year - where doctors have been specially trained to administer it and have a certain drug on hand to mitigate the bad reactions.

Novartis' offer of financial assistance and twist on the money-back guarantee - only charging patients an estimated $475,000 if they respond to the treatment within the first month - seem surprisingly kind and generous in an industry where vital drugs are often exorbitantly priced. But the drugmaker isn't being altruistic: the policies should raise demand and expand its candidate pool, hopefully leading to more positive outcomes and glowing press coverage, driving demand even higher and generating bigger sales and greater market share. Like any company launching an innovative product, Novartis wants to explore whether it works for a broader audience, rapidly gather feedback to inform improvements, cash in on its monopoly and win physicians over before rivals enter the market. It's a rare case where the company's business goals align with societal goals - raising awareness of a potential cure, improving it, and treating as many of the 600-odd people in the US eligible for the therapy each year as quickly as possible.

Rather than squeezing patients and insurers for every penny they have, Novartis is focused on field-testing Kymriah and maximising access. It plans to seek regulatory approval in the US and EU for Kymriah to be used on another form of lymphoma later this year. Meanwhile, doctors are enrolling patients with all kinds of cancers in hundreds of trials to find out whether the treatment can work for them too. And other companies are rushing to develop universal T-cells that can be infused into anyone's bloodstream to pinpoint and destroy cancer. It's a classic case of a firm introducing a new technology to the market, customers clamouring for it, and competitors iterating on it and racing to release rival offerings. In a notoriously dysfunctional healthcare market, it's worth celebrating a rare moment when everything seems to be working like clockwork.