Sanofi needs Dupixent to meet lofty expectations

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If ever a single product’s launch weighed heavily on a big pharma’s future, it is that of Sanofi’s Dupixent. US approval today gives the French group an opportunity to replace revenue lost to the fierce competition against its long-acting insulin Lantus, but only if the atopic dermatitis drug can perform as well as optimistic forecasts.

Setting a list price of $37,000 a year gives Sanofi a decent chance of passing muster with payers and establishing Dupixent in a favourable position on formularies. With the disappointment of Praluent fresh in investors’ minds, a positive launch for Dupixent might do much to restore confidence.

Surprise! An affordable price

That the price might be acceptable to payers is implied by a draft evidence report on Dupixent and Eucrisa published last week by the Institute for Clinical and Economic Research (ICER).

This stated that at $30,632 a year the Regeneron invented antibody would yield a cost per quality adjusted life year (QALY) of $100,000, and at $43,895 it would be $150,000 per QALY. ICER estimates what the price of new drugs would be at cost thresholds of $50,000, $100,000 and $150,000 per QALY.

In that analysis, ICER estimated that around 10% of eligible patients would take Dupixent in five years at the list price. Bernstein analyst Ronny Gal estimates that the actual price paid would be around $24,000-$26,000 a year, which in the ICER analysis would get uptake to around 20%.

“We don’t anticipate payer restrictions to be too onerous,” Mr Gal wrote in a note today.

The FDA approved Dupixent for moderate to severe atopic dermatitis that is not well controlled with prescription topical medications.

Dermatitis and more

EvaluatePharma's consensus of sellside forecasts puts revenues at $4.3bn in 2022, with atopic dermatitis accounting for $3.2bn and asthma the remainder. Mr Gal forecasts a lower total for dermatitis, where he believes sales will peak at $1.5bn.

Dupixent is Sanofi’s big growth driver, making it key to reversing a revenue slide that is expected to have bottomed out last year at $37.4bn (Upcoming events – FDA decision for Dupixent as Novartis drives its CAR-T, March 24, 2017).

This will depend, in part, on Dupixent hitting its first-year benchmark of $169m, Toujeo making up for Lantus losses, and the cholesterol treatment Praluent achieving $288m – the last would be no mean feat, with ongoing patent worries and concerns that the PCSK-9 drug class delivers only a modest benefit.

Indeed, those patent concerns extend to Dupixent, which like Praluent clashes with intellectual property owned by Amgen.

As usual, initial prescription trends will be closely watched. If the pressure was already high for Sanofi's chief executive, Olivier Brandicourt, to make a major M&A move, then a disappointing launch for Dupixent would make it nearly impossible to ignore.

To contact the writer of this story email Jonathan Gardner in Virginia at jonathang-us@epvantage.com or follow @ByJonGardner on Twitter

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