J&J’s Zytiga for Prostate Cancer Too Expensive, U.K. Cost Agency Says

A Johnson & Johnson prostate-cancer medicine discovered in England and developed with funds from U.K. charities is too expensive for the country’s National Health Service.

The NHS shouldn’t pay for Zytiga because the drug’s benefits don’t justify the cost even after the manufacturer agreed to cut the price, the National Institute for Health and Clinical Excellence said in a statement today. The agency, known as NICE, advises the state-run medical system on which treatments it should pay for. J&J and the public have a chance to comment on the decision, which is preliminary, NICE said.

Advocates for cancer patients criticized the ruling, saying the drug helps keep men alive after chemotherapy has failed to stop their cancer. Zytiga, which costs 2,930 pounds ($4,640) for a 30-day supply, may extend life by more than three months compared with a placebo, and can be taken orally at home, London-based NICE said. The agency isn’t disclosing the discount that New Brunswick, New Jersey-based J&J agreed to provide.

“We’re hugely frustrated that NICE felt the drug wasn’t good value for money,” Harpal Kumar, the chief executive officer of the charity Cancer Research UK, said in a separate statement. “Generous public donations to Cancer Research UK and other organizations paid for the initial development of the drug and we feel extremely let down that the drug’s manufacturer couldn’t offer NICE a price they could agree on.”

Zytiga Sales

Zytiga’s U.S. sales may reach $1.28 billion in 2015, according to Larry Biegelsen of Wells Fargo (WFC) Securities LLC. The drug, also known as abiraterone, won approval in the European Union last year for use in combination with prednisone or prednisolone for men whose prostate cancer didn’t respond to chemotherapy. U.S. regulators approved the treatment in April.

“It is an expensive drug and the independent advisory committee that made this decision did not feel the drug provided enough benefit to patients to justify the price the NHS is being asked to pay, even with the discount that the manufacturer has offered,” said Andrew Dillon, NICE’s chief executive, in the statement.

J&J can consider cutting the price further, NICE said. The agency declined to comment beyond the statement.

The decision “is the first step in the appraisal process and we will be actively participating in this consultation as we strive for a positive outcome for patients,” J&J said in an e- mail. The company said its proposed discount meets NICE’s requirements for cost-effectiveness for late-stage cancer medicines.

Drug Discovery

The drug was discovered at the London-based Institute of Cancer Research in work that was funded by grants from Cancer Research UK, the Medical Research Council and BTG Plc (BGC), according to Cancer Research UK. Those and other groups helped fund subsequent clinical trials, the charity said.

Cancer Research UK is entitled to royalties on the drug, which will be reinvested in research, the group said in today’s statement. BTG, a London-based drugmaker, licensed the drug to Cougar Biotechnology Inc., which was acquired by J&J in 2009.

NICE’s decisions apply to the NHS in England and Wales. The Scottish Medicines Consortium advises the NHS in Scotland on the cost-effectiveness of drugs. Northern Ireland considers NICE’s advice and distributes it to doctors and hospitals after a review by local officials.

If the standard chemotherapy, docetaxel, doesn’t work against prostate cancer, the other treatment options are mitoxantrone, a generic drug, and re-treatment with docetaxel, NICE said. Re-treatment isn’t recommended by NICE, and the agency hasn’t produced guidance on mitoxantrone.

NICE this month reiterated a decision to reject Jevtana, a prostate-cancer drug made by Paris-based Sanofi. (SAN)

About 10,000 men are diagnosed with advanced prostate cancer each year in the U.K., according to Cancer Research UK.

To contact the reporters on this story: Phil Serafino in Paris at pserafino@bloomberg.net

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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