Novartis offers insurer discount, with strings, for pricey drug

In an unusual move, Novartis began offering price discounts in negotiations with insurers for its pricey gene therapy for spinal muscular atrophy — but there's a catch, according to Reuters.

In exchange for the pricing discount, the Swiss drugmaker wants insurers to commit to covering treatment for any patients identified to have the rare and often fatal neuromuscular disease. In addition, Novartis is asking insurers to ensure quick authorization and more widespread screening to identify newborns with the disease.

It is unusual for drugmakers to offer discounts on novel treatments, but getting insurers to cover the drug is key for its success.

The FDA is set to decide on approval of the drug, Zolgensma, which may cure spinal muscular atrophy, according to Novartis. Company officials said the price would range from  $1.5 million to $5 million.

"We are very much interested in making sure that payers [support] newborn screening, that they establish fast turnaround on coverage decisions, and that they have specific policies that cover gene therapy for SMA," Dave Lennon, head of Novartis' AveXis unit, told Reuters.  "As we negotiate discounts, et cetera, with payers, and the contracts with those payers, we’re trying to make sure they put those elements in place."

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