(Reuters) – Spark Therapeutics Inc said on Wednesday it will charge $850,000 per patient for its breakthrough gene therapy to treat a rare form of blindness, a lower than expected price that the company said reflects patient and insurer concerns about access and cost.
Investors had expected the company to charge closer to $1 million for the treatment, Luxturna, which is designed to be given just once. The product, approved in December by the Food and Drug Administration, is the first U.S.-approved gene therapy for an inherited disease.
Spark said it has created a number of payment models to help reduce costs for insurers by allowing installment payments over a number of years and to ensure financial concerns do not hinder access for patients.
“The price reflects the stakeholder considerations we have learned about these past months,” the company said in a statement, “and our need to build a sustainable company that addresses the unmet needs of patients with genetic diseases.”
Luxturna has the highest list price of any drug, although the ultimate cost for patients and insurers may be less than for other expensive drugs that must be given every year for life.
“We believe these pricing initiatives for a one-time treatment may widen the availability of the drug for patients,” Justin Kim, an analyst at Cantor Fitzgerald, said in a research note.
Spark’s shares rose 0.6 percent to $53.65 in midmorning trading.
Luxturna treats inherited retinal disease caused by defects in a gene known as RPE65, which tells cells to produce an enzyme critical for normal vision. The condition affects between 1,000 and 2,000 people in the United States.
The product works by delivering by an eye injection some 150 billion viral vector particles containing a correct copy of the RPE65 gene to retinal cells, restoring their ability to make the needed enzyme.
Clinical trials of Luxturna showed that 93 percent of participants experienced some improvement in their functional vision as measured by their ability to navigate obstacles in poor light after one year. It is unclear how long the benefit of the treatment will ultimately last.
Additional reporting by Akankshita Mukhopadhyay in Bengaluru; Editing by Arun Koyyur and Bill Trott