UPDATED: Vertex wins a crucial FDA nod for its cystic fibrosis combo, prices at $259,000

Vertex CEO Jeffrey Leiden

Vertex Pharmaceuticals ($VRTX) won the FDA's blessing to market a new combination therapy for cystic fibrosis, clearing the way for a drug key to the company's future as it moves away from antiviral treatments.

The agency signed off on Vertex's Orkambi, which combines the investigational lumacaftor with ivacaftor, already marketed as Kalydeco. Orkambi is designed for the roughly 8,500 patients whose CF is caused by the so-called F508del mutation in their CFTR genes, making up the disease's largest population. Kalydeco, first approved in 2012, is cleared to treat CF patients with different CFTR mutations, a group totaling roughly 2,000, according to Vertex.

In its pivotal trial, Orkambi demonstrated a statistically significant improvement in lung function compared with placebo, a surrogate endpoint for improving symptoms of CF. Due to Vertex's study design, the company never authoritatively proved that adding lumacaftor led to a significant improvement over Kalydeco alone, FDA advisers said at a meeting in May, but that concern wasn't enough to derail the drug's path to approval.

The FDA's decision, which has been expected for nearly a year, expands Vertex's dominance in CF, giving the company a chance to bolster the roughly $460 million a year it brings in from Kalydeco.

The old drug costs about $311,000 on its own and Vertex is pricing its combo at $259,000 in anticipation of a much larger patient population--above the $230,000 to $250,000 range forecast by several analysts. For a drugmaker recently forced to pull the plug on its once-profitable hepatitis C business, though, a pricey new cornerstone therapy in CF is an attractive proposition.

"More than 15 years ago, our scientists set out to discover and develop medicines to treat the underlying cause of cystic fibrosis," Vertex CEO Jeffrey Leiden said in a statement. "Today, the approval of Orkambi represents a fundamental change in the treatment of the most common form of CF, marking significant progress for us and for the entire CF community."

Vertex's shares were halted before the news on Thursday. The biotech's value has roughly doubled since it first disclosed positive Phase III results for Orkambi last summer.

- here's Vertex's statement (PDF)

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