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Expand chart
Reproduced from KFF and Bernstein; Chart: Axios Visuals

Biogen's new Alzheimer's treatment could be experts' nightmare drug spending scenario: An extremely expensive product that millions of desperate patients could be eligible for — and it may not even work.

Why it matters: Alzheimer's is a devastatingly common disease with no cure. But the FDA's decision this week paved the way for a free-for-all in which taxpayers foot most of the enormous bill for a drug that hasn't been proven effective.

Driving the news: The FDA approved Aduhelm for all Alzheimer's patients, rather than the narrower subset it was tested against.

  • It's estimated that around 6 million Americans currently have the disease, most of whom are covered by Medicare.

By the numbers: Around 500,000 Americans are diagnosed with Alzheimer's each year, and the company announced that the drug costs $56,000 annually.

  • Patients would receive monthly infusions of the drug, which they'd likely need long-term. An Alzheimer's patient lives, on average, an additional three to 11 years after their diagnosis, per the Mayo Clinic.
  • If half of the newly eligible Americans in a year began treatment with Aduhelm, the cost would be $14 billion — roughly equivalent to Medicare Part B spending in 2019 on the next 8 products combined, per a Bernstein analysis. Total Part B spending in 2019 was $37 billion.
  • But that's a conservative estimate of annual spending on Aduhelm, as it only applies to half of one year's worth of newly diagnosed Alzheimer's patients.

Yes, but: It will likely take a while for the health system to build up enough capacity to handle the influx of eligible patients.

  • And some private insurers may limit eligibility. Steve Miller, chief clinical officer at Cigna, said yesterday that he expected Cigna and most other insurers will pay for the drug only for patients meeting certain criteria, per the NYT.

Between the lines: The numbers alone could give new ammunition to advocates who argue that drug prices are too high and should be limited.

  • "It's unconscionable to ask seniors and taxpayers to pay $56,000 a year for a drug that has yet to be proven effective. Medicare must be able to negotiate a fair price for prescription drugs," tweeted Senate Finance Committee Chairman Ron Wyden.
  • But politicians may find it hard to take on the narrative that the treatment is anything but a long-sought beacon of hope for Alzheimer's patients.

What they're saying: “It’s always been the worry that if you get a super expensive drug that is targeted toward a huge population, that that is going to be a turning point in how we deal with health care spending," said Walid Gellad, a health policy professor at the University of Pittsburgh. "And that’s what this drug is.”

Go deeper: Aduhelm's price to squeeze Medicare and patients

Go deeper

Jun 8, 2021 - Health

Aduhelm's price to squeeze Medicare and patients

Aduhelm has a list price of $4,300 per infusion. Photo: Biogen

More than 90% of people with Alzheimer's disease are 65 and older, which means Medicare (i.e., taxpayers) will shoulder the load for Aduhelm's $56,000 annual list price.

Why it matters: Aduhelm could create massive strains on Medicare spending and could create financially ruinous prospects for patients and their families.

Jun 8, 2021 - Health

Experts question FDA standards with Aduhelm approval

Illustration: Annelise Capossela/Axios

Following the FDA's approval of Biogen's Alzheimer's treatment Aduhelm, experts fear the approval — based on weak scientific data — is a sign the agency is putting speed over rigor.

The big picture: "A general signal being sent to the rest of the drug industry is: If you can get uncertain, maybe suggestive data and a post-hoc analysis — get that threshold to us — we may approve your drug," said Peter Bach, a drug researcher at Memorial Sloan Kettering Cancer Center.

Jun 7, 2021 - Health

FDA approves Biogen's Alzheimer's drug despite lack of evidence

Photo: Sarah Silbiger/Getty Images

The FDA has approved Biogen's Alzheimer's drug, aducanumab, which will be marketed as Aduhelm. Biogen is charging $56,000 per year for the drug.

Why it matters: Aduhelm is the first federally approved Alzheimer's treatment in roughly 18 years, but there is no conclusive evidence the drug slows the decline of memory and brain function.