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Biogen says Alzheimer’s drug to cost less than $10,000 a month

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(Bloomberg) — Biogen Inc. (Nasdaq:BIIB) will charge less than $10,000 a month for a drug to treat Alzheimer’s disease, Chief Executive Officer George Scangos said, seeking to avoid the attention rival drugmaker Gilead Sciences Inc. (Nasdaq:GILD) received for the price of its hepatitis C treatment Sovaldi.

Biogen is already in preliminary talks with providers of drug insurance benefits over the price of the medication, BIIB037, which is still in clinical trials, Scangos said Tuesday at the World Medical Innovation Forum in Boston.

Gilead and AbbVie Inc. have faced criticism from lawmakers, consumer advocates and insurers over the cost of their hepatitis C drugs, which sell for more than $1,000 a day. The drugmakers say the medication, which cure the liver disease, are a cheaper option than a lifetime of treatment, and they have argued that insurers should do more to cover the costs.

“If we are not thoughtful about it, it will make Sovaldi look like a blip,” Scangos said of BIIB037’s price, referring to the controversy over how much Sovaldi costs.

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Gilead didn’t immediately respond to a request for comment.

Unlike Gilead’s drug, BIIB037 isn’t a cure. At $10,000 a month, the medication would cost $120,000 a year, in line with cancer drugs that have also been criticized as expensive. Sovaldi only requires 12-week course of treatment to eliminate hepatitis C in many patients.

Biogen probably needs to invest $2.5 billion in BIIB037 before knowing whether it’s even effective, Scangos said at the same event Monday. The figure includes the costs of running trials and building a manufacturing plant for the drug.

The drugmaker’s shares soared when the company said in December that its drug, BIIB037, had worked so well in an early-stage trial that it would skip directly to large-scale trials intended to get the drug approved.

In its trial of about 200 patients, BIIB037 reversed build-up of beta amyloid in the brain and also reduced cognitive decline, according to Biogen.

Since the results showed the drug was more effective with higher doses and longer periods of use, and the data were statistically significant even in a small population, the drug’s benefit has to be substantial, Scangos said.

—With assistance from Zachary Tracer in New York.

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