Biogen Slashes Price of Its $56,000 Alzheimer's Drug Aduhelm After Widespread Criticism

Biogen announced Monday that it will reduce the cost of its new Alzheimer drug by half after facing extensive criticism when it said the treatment would cost an estimated $56,000 per year.

Adulhem was revolutionary in the Alzheimer's field because the drug cleared plaque in the brain believed to contribute to the disease. So the drug slowed progression of the disease, not just managing the symptoms, Biogen said.

The new drug came at a steep price as patients were expected to pay an average of $56,000 annually for treatment. Biogen announced that starting next month, Aduhelm will cost $28,200 per person for a person of average weight.

The company's announcement for a reduction in price was partly because physicians weren't offering the drug to their patients due to "financial considerations," Biogen CEO Michel Vounatsos said in a statement.

Doctors said they were concerned with their patients paying for the drug because the protocol requires frequent testing and scans to monitor their development while taking the medication.

Medicare said the initial steep price of Aduhelm was a key factor for the planned increase of its monthly premium for Part B outpatient care from $148.50 to $170.10 a month starting in January.

The FDA approved Aduhelm in June to treat patients with early-stage Alzheimer's or mild symptoms.

The actual amount a person would pay for Aduhelm will depend on factors like insurance coverage.

But Aduhelm's debut has been slowed by concerns over the price and research behind the drug. Some insurers have balked at paying for the drug, while medical centers across the country have been either slow to decide on using the drug or said they weren't planning to prescribe it for now.

Vounatsos said too many patients' diseases had progressed beyond the point where Aduhelm could help and that's partly why doctors weren't prescribing the treatment.

Biogen said in June that it would not raise its price on the drug for four years, and the company often touted its financial assistance programs for patients.

RBC Capital Markets analyst Brian Abrahams said he was not surprised by Biogen's price cut. He said in a research note that the move was probably necessary and should "give Aduhelm its best opportunity for success."

Medicare, the federal government's coverage program for people ages 65 and older and for the disabled, The agency said about half of that hike was due to the need for a contingency fund to cover Aduhelm. Medicare is expected to be one of the main payers for the drug.

U.S. regulators gave their approval based on study results showing the drug seemed likely to benefit patients. But they've asked for more research.

Biogen, which developed Aduhelm with Japan's Eisai Co., said last week the company expects to screen the first patients for their next study in May. Researchers will aim to enroll about 1,300 people with early-stage Alzheimer's and expects to complete the research about four years after the study begins.

Concerns about the research behind the drug were a main reason the European Medicines Agency cited in refusing Aduhelm's marketing authorization last week.

Biogen said in October that Aduhelm had brought in only $300,000 in sales during its first full quarter on the market. The company attributed that figure partly to drug wholesalers drawing down inventory they had purchased the previous quarter.

Biogen also said Monday that it will start some cost-cutting measures that are expected to yield about $500 million in annual savings, most of which will be realized next year. The company said it was cutting costs in part because the slow debut of Aduhelm was affecting its revenue.

Shares of Biogen Inc., based in Cambridge, Massachusetts, slipped $1.07 to $236.36 Monday morning while broader indexes fell.

The stock price had soared past $425 in June after the FDA approval, but shares have since shed nearly half their value.

The Associated Press contributed to this report.