FDA approves first new lupus drug in 50 years

Pills on money symbolizes costs of U.S. health care

TEXT OF STORY

JEREMY HOBSON: The Food and Drug Administration has cleared a new drug to treat Lupus. And it's already being called a potential blockbuster for the pharmaceutical industry. The drug -- which is made by GlaxoSmithKline and the biotech firm Human Genome -- is the the first new treatment for Lupus in 50 years.

Marketplace's health care reporter Gregory Warner is live with us this morning to talk about it. Good morning Gregory.

GREGORY WARNER: Good morning Jeremy.

HOBSON: When we use a term like Blockbuster drug -- tell us what that means for these companies.

WARNER: Well, analysts are talking about potential sales of $2 billion a year -- I've even read $3 billion in world wide sales. But this is a different kind of blockbuster. If you think about Viagra or Lipitor -- those work by treating lots of people, getting lots of customers. Lupus affects about 300,000 Americans -- mostly young women -- its a disease of the immune system. But this drug doesn't even treat all of them. The FDA estimates that about 11 patients have to take this drug for 1 patient to see a benefit.

I called Dan Carpenter. He's a professor at Harvard. He studies the FDA. He says this is part of a new trend in personalized medicine -- drugs that target a specific group of patients.

DAN CARPENTER: It may indeed be a different kind of market model. The carving out of a population with a certain form of the disease.

HOBSON: So we're talking about a much smaller number of potential customers here, Gregory. How can these companies make blockbuster money in that case?

WARNER: Well, by charging more. There are no other good treatments out there for this disease. The last drug approved for this disease was 50 years ago as you said. So GlaxoSmithKline and Human Genome can really set the price. They're talking about $35,000 per treatment per year.

HOBSON: $35,000. Marketplace's health care reporter Gregory Warner, thanks.

WARNER: Thanks.

About the author

Jeremy Hobson is host of Marketplace Morning Report, where he looks at business news from a global perspective to prepare listeners for the day ahead.

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