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CEO of CVS says Biogen Alzheimer’s drug won’t break the bank right away

Henry Magendantz, a patient in the Biogen aducanumab trial, after an infusion in Providence.
Henry Magendantz, a patient in the Biogen aducanumab trial, after an infusion in Providence.KAYANY SZYMCZAK/NYT

(Bloomberg) -- Biogen Inc.’s new treatment for Alzheimer’s disease won’t significantly affect medical costs this year or next, said Karen Lynch, the chief executive of CVS Health Corp., on Wednesday.

Aduhelm, which won US approval on Monday, has a list price of $56,000 a year, much higher than many Wall Street analysts had expected. Millions of patients might be eligible to receive it, raising the possibility of a weighty new burden on the wider health-care system.

CVS, which operates one of the largest US health-insurance businesses, is evaluating Aduhelm while it awaits word from the Centers for Medicare and Medicaid Services on how the government agency plans to pay for it, Lynch said at the Goldman Sachs Annual Global Health-Care Conference.

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Biogen has said it expects 80 percent of patients on Aduhelm to be on Medicare, and that the number getting it will rise gradually.

Lynch said she doesn’t anticipate a large financial impact from covering the treatment right away given the demographics of CVS’s members. She also said Aduhelm is administered intravenously, a possible opportunity for the company’s infusion business.

There is a tremendous amount of money being spent on Alzheimer’s care, and Biogen’s treatment could be life-changing for patients, Lynch said.

The US Food and Drug Administration granted Aduhelm an accelerated approval over the objection of outside scientific advisers and despite uncertainty over whether the drug meaningfully changes the course of Alzheimer’s disease. Biogen will have to conduct another trial to confirm the drug’s effectiveness.

Insurers are in discussions over how to link payments for the drug to outcomes, Tim Wentworth, CEO of Cigna Corp.’s Evernorth unit, said at the same conference.

Wentworth said he met with Biogen’s board years ago to discuss pricing of an Alzheimer’s therapy. The drugmaker is interested in both “access and affordabilty,” he said. That might mean giving health-care payers a chance to claw back payments if the drug doesn’t work.

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“I’d like to believe that they’re willing to stand behind this drug -- that if it’s given to the patient for whom its indicated, that if it doesn’t work, that there’d be a mechanism to potentially get a payer back some or all of their investment in trying this drug with that patient,” he said.

Cigna is in talks with Biogen on developing a value-based contract for Aduhelm, the companies said after the drug was approved.

“Their list price is not where this conversation should end,” Wentworth said. “We think there’s a lot of opportunity to create meaningful value and access below that number.”

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