Cell Therapeutics Gets a Win on Capitol Hill, Zevalin Reimbursement To Remain Same

7/9/08Follow @xconomy

Cell Therapeutics got its way in Washington DC today. The Senate voted 69-30 in favor of a Medicare bill that includes a provision extending the current reimbursement rate for doctors who prescribe Zevalin, a drug for non-Hodgkin’s lymphoma, which happens to be the Seattle biotech company’s sole marketed product. Medicare had proposed a new reimbursement system that would have paid prescribers less for the drug, said company spokesman Dan Eramian.

Zevalin is the first of two drugs approved in the U.S. that combine an antibody that can seek out tumors with a dose of radiation to give it extra tumor-killing kick. The drug has shown striking results in clinical trials, yet has never taken off commercially, partly because of wrangling between payers and doctors over its cost.

Researchers at the American Society of Hematology presented data from a clinical trial in December that showed a single shot of Zevalin caused tumors to completely disappear for 76 percent of patients. Yet it only generated $16.4 million in sales in 2006, its fifth year on the market. One reason: Medicare typically pays less for the drug than it costs hospitals to administer it, researchers told me last December while I was at Bloomberg News.

The proposed changes would have only exacerbated the problem.

The vote by the Senate means the Medicare bill now goes to the desk of President Bush, Eramian said. It basically allows for an 18-month extension of 2007 reimbursement rates, which pay $21,000 a patient for the drug. If Congress had agreed with Medicare, the new rate would have been about $15,000 a patient. Now it will be up to Cell Therapeutics to see if it can actually get doctors to start using it.

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