Entresto, the new heart failure drug from Novartis that is widely expected to be a blockbuster, is off to an exceptionally slow start.
Approved last July, the drug, formerly known as LCZ 696, had sales of only $21 million in 2015, only $5 million of which came in the fourth quarter. Despite low expectations in the early days a company official acknowledged that the Entresto launch was disappointing:
It’s very clear that Entresto started slowly in the US, and in fact, we cautioned that uptick would be slow. But even with that caution, I would say that the brand performed more modestly than even we had anticipated.
During a quarterly conference call yesterday Novartis officials offered a number of explanations for the drug’s slow start.
The poor performance was driven in large part by limited formulary access to the drug last year. Most Medicare formularies, which have 6 months to make a formulary decision, did not place Entresto in the formulary until recently. The company said that two-thirds of the drug’s potential population are on Medicare.
Novartis anticipates that about 60% of Medicare patients will shortly have access to the drug, though in many cases this will require prior authorization. The company acknowledged that nearly half of these patients will have expensive c0-pays of $100 or higher because the drug will be placed on the lowest reimbursement tier. The company said 78% of commercial insurance plans would reimburse for Entresto by the end of January.
For the first half of 2016 Novartis expects sales to “remain modest,” but it expects “a significant pick up in the second half of the year.” Future sales of the drug will likely be tied to new heart failure guidelines in the US and Europe which are expected to come out later this year. Bernstein analyst Tim Anderson pointed out that if the guidelines take a conservative approach and do not state that Entresto is superior to current therapies with ACE inhibitors or ARBs, “then payers will have cover to be less generous in covering the drug.” However, given the highly positive results of the PARADIGM-HF trial it seems likely that the guidelines will provide some support for a superiority claim.
Entresto has only recently been approved in Europe, but the company said that early signals are that it is doing much better in Europe than in the US. The drug costs $12.50 per day in the US, but in most cases there are discounts. The price in Europe is considerably lower, roughly €5-5.5.
An article last year in Medical Marketing & Media pointed out that Entresto (and other new cardiovascular drugs like the PCSK9 inhibitors) may face an additional hurdle in getting to patients, since “cardiologists are less likely to advocate for insurance coverage for drugs to treat their patients compared to oncologists, dermatologists and rheumatologists, who have more experience doing so.”