Eli Lilly and Co. said it plans to push ahead for federal approval for its highly-anticipated drug for Alzheimer’s disease despite an unfavorable ruling last week from Medicare that sharply restricts reimbursements for a drug in the same class.
The Indianapolis-based drugmaker said Monday it intends for complete its application this year to the Food and Drug Administration for review of the drug, called donanemab.
The move underscores Lilly’s confidence that the experimental medicine will perform well enough in an ongoing clinical trial to convince Medicare to pay for the broad use of the drug.
Lilly’s drug is viewed as one of the brightest spots in its pipeline, and has been closely watched by investors each step of the way to see if it will help patients with memory loss and cognitive decline.
On Thursday, Medicare officials issued an unusually restrictive decision on a controversial Alzheimer’s disease drug made by Biogen Inc., saying it would pick up the tab only for patients enrolled in trials.
The move slammed the door for many elderly patients who might have wanted to take the drug, but couldn’t afford its price tag, which was originally more than $50,000 a year, but has since come down to about $28,000 a year.
The FDA had approved the drug, called Aduhelm, for people with mild Alzheimer’s-related cognitive decline, but the clinical trial evidence was mixed. Some patients on the drug showed slight slowing of cognitive decline. But patients in another Biogen trial didn’t appear to benefit at all.
In January, Medicare issued a preliminary decision that it would cover FDA-approved Alzheimer’s disease drugs in the class of monoclonal antibodies that target amyloid only for patients enrolled in qualifying clinical trials.
Aduhelm is the only drug on the market that meets that description. But several other Alzheimer’s disease drugs in development, including Lilly’s donanemab, are also in the class of monoclonal antibodies.
On Thursday, Medicare backed off from that position, and said only if the FDA finds clear evidence that a drug can help patients—which it didn’t find in the Biogen case—that Medicare would cover it for all eligible patients.
Lilly said Monday it was proud of its published data in the New England Journal of Medicine in an earlier trial for donanemab, and was “excited for the Phase 3 data for donanemab that are expected in mid-2023. We will continue to advocate for broad patient access to donanemab based on the clinical evidence.”
Analysts predicted that Lilly’s drug could become a blockbuster seller in two or three years and become one of the company’s top-selling products within a decade. Evan Seigerman, an analyst with BMO Capital Markets, hailed the Medicare decision in a note to clients on Thursday.
“This could be a significant advantage for Lilly, with pivotal data next year,” he wrote. “…We remain bullish on donanemab.”
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The government has no business approving a drug with this cost for Medicare coverage.