Dendreon says Medicare reviews whether to cover costs of prostate cancer therapy Provenge

Dendreon: Medicare reviews Provenge costs

NEW YORK — Medicare administrators say they will take a full year to review Dendreon Corp.’s prostate cancer therapy Provenge and decide whether to cover the costly treatment.

Provenge, which costs $93,000 for a course of treatment, has been widely expected to bring Dendreon billions in revenue in the coming years. But sales will be slashed if Medicare decides not to cover the cost or offers only limited coverage. Medicare’s Coverage and Analysis Group will propose a decision in about nine months and make a final ruling about a year from now. That decision will apply to all Medicare contractors.

In morning trading, shares of Seattle-based Dendreon lost $3.53, or 11 percent, to $28.75.

The Food and Drug Administration approved Provenge in late April, and some Medicare insurance contractors already are paying for the therapy, but there is no national policy. Contractors can continue to cover Provenge during the agency’s review, but must adhere to any final decision.

Medicare is evaluating whether or not it is reasonable and necessary to cover Provenge. Clinical studies have shown that patients treated with Provenge live about a month longer than those received traditional chemotherapy treatment.

The FDA has approved Provenge for patients who have prostate cancer that has spread and that has not responded to hormone-based treatment. Medicare will consider whether it makes sense to cover a costly drug that has a relatively narrow approval. But if it decides to cover Provenge treatment for patients with less advanced cancer, that could help sales.

Medicare will also deal with a deceptively simple question: what is Provenge? Is it a traditional drug, a biologic drug, or something else? The answer could affect how much of the cost Medicare will cover because different types of drugs are covered at different rates.

Provenge is designed to train a patient’s immune system to attack tumors. It is different from traditional drugs and even biotech drugs because it is made by mixing blood cells from the individual patient with a protein found on cancer cells and an immune system-boosting substance.

Wednesday marked the beginning of a 30-day public comment period on coverage. After the comment period ends, the agency will take about nine months to create a proposal. The public will then have 30 days to comment on the proposal, and Medicare will publish a final decision within 60 days of the end of that comment period. The decision goes into effect as soon as it is published.