Biomarin Pharmaceutical Inc. is on the receiving end of a complete response letter (CRL) for its BLA for valoctocogene roxaparvovec gene therapy for severe hemophilia A ahead of its Aug. 21 PDUFA date.

According to Biomarin, of San Rafael, Calif., it all comes as a surprise. The company said it had an agreement with the FDA on the extent of the data needed to support the BLA but said the FDA added a new recommendation for two years of data from the company's ongoing phase III study of 270-301 to provide “substantial evidence of a durable effect” using an annualized bleeding rate as the primary endpoint. 

The FDA first informed the company about the recommendation in the CRL, “having not raised this at any time during development or review,” according to Biomarin. The CRL recommended completing the phase III and then submitting a two-year follow-up safety and efficacy data report on all participants. 

Biomarin stock (NASDAQ:BMRN) took the brunt of the news as 33% of its value had slipped away by midday Aug. 19.

In February, the FDA accepted for priority review the BLA for the AAV5 gene therapy for adults with hemophilia A and set an Aug. 21 PDUFA date. Simultaneously, the agency told the company it was not planning on an advisory committee meeting to discuss the application.

“The adcomm comes as an upside surprise,” noted J.P. Morgan analyst Cory Kasimov. “In our view, this bodes well for the company as it suggests that there are no outstanding questions at this time from FDA that they are looking to get expert feedback on.”

Biomarin’s application was based on a phase III interim analysis of patients treated with Valrox, along with three-year phase I/II data that found the high-dose cohort showed 100% resolution of target joints, a 96% reduction in mean annualized FVIII usage, and all patients remained off FVIII prophylaxis therapy.

In June, Biomarin reported additional data from the four-year update of its phase I/II study of valoctocogene roxaparvovec showing 93% reduction from baseline in annualized bleed rate (ABR) in 6e13-vg/kg cohort, with mean ABR of 1.3 and median of 0 in year 4 and 96% reduction in mean factor VIII usage to 5.4 infusions per year cumulatively. Among seven participants in the 6e13-vg/kg cohort, six (86%) were bleed-free in fourth year. In the 4e13-vg/kg cohort, cumulative mean ABR was reduced by 93% to 0.9 with continued absence of target joint bleeds in five of six subjects during three years of observation, representing a 93% reduction from baseline.

Valrox could be the first potentially curative (one and done) approach to hemophilia A, eliminating the need for blood transfusions and factor VIII (FVIII) replacement therapy after a single infusion. People suffering from the most severe form of hemophilia A often experience painful, spontaneous bleeds into their muscles or joints and that group composes about 43% of the hemophilia A population. The standard of care is a prophylactic regimen of replacement FVIII infusions administered intravenously up to two to three times weekly or 100 to 150 infusions annually. Despite treatment, many continue to experience bleeds, resulting in progressive and debilitating joint damage, which can have a major impact on their quality of life.

Valrox is a biologic, part of a fast-growing and increasingly expensive segment of prescription medicine whose cost regulators and payers alike have tried to rein in recently.

Valrox was one of 11 potential blockbuster drugs included in Clarivate’s 2020 Cortellis Drugs to Watch list. Valrox is expected to have a big price tag: $2 million to $3 million. Since it’s a one-time cure, Biomarin may not have as big of a sell with payers as would a company seeking premium pricing for a drug to treat a chronic condition. Provided the cure valrox offers proves to be durable over the long term, a U.S. payer could recoup a one-time expense of $3 million within five years, as current replacement therapies for hemophilia A add up to annual costs of $600,000 to $800,000.

However, payers might balk at a high-priced cure due to the fluidity of the insurance market. There’s no guarantee that the insurer who pays for the cure will be the one to realize the savings. So, depending on a patient’s age and other factors, a payer could attach a lot of conditions to its coverage of the gene therapy. To overcome payer hesitancy, Biomarin may have to get creative in its negotiations, perhaps offering an installment plan or an outcomes-based arrangement.

Regardless of payment hurdles, valrox could hit blockbuster sales with fewer than 500 patients per year. But then there’s the question of the patient copay. While drug companies point to the value a cure brings in terms of “health savings” to justify seven-figure price tags to payers, patients are bound by what they can afford.

Large-cap Biomarin continues to expect to be profitable on a GAAP basis for the first time in its full-year 2020 guidance, despite impact from COVID-19. In August, the company reported second-quarter revenue of $429.5 million, including $386.8 million in net product revenue.

Biomarin has constructed, commissioned and validated a gene therapy manufacturing facility located in Novato, Calif., that will produce the therapy. In March, Biomarin said it will develop a companion diagnostic for valoctocogene roxaparvovec in hemophilia A patients with ARUP Laboratories Inc., of Salt Lake City. No payment was specified.