Marathon Pharmaceuticals sold its recently approved Emflaza (deflazacort) to PTC Therapeutics in an agreement that includes an upfront payment of $140 million plus a potential milestone payment of $50 million and royalties.
As we reported, Marathon came under fire last month—just after the Food and Drug Administration approved the decades-old generic corticosteroid for the treatment of Duchenne muscular dystrophy (DMD)—when the company announced that it was pricing Emflaza at $89,000 per year. U.S. patients have been importing the drug from other countries for approximately $1,200 per year. Payers typically haven’t covered deflazacort because it wasn’t FDA-approved.
PTC is developing its own drug for DMD, Translarna (ataluren). That drug was granted conditional approval by the European Medicines Agency in 2014, but the FDA refused to file PTC’s New Drug Application for Translarna in 2016. PTC said it plans to use cash flow from Emflaza sales to help fund the company’s research and development activities and to establish the groundwork for launching Translarna.
Meanwhile, Sen. Bernie Sanders, I-Ver., and Rep. Elijah Cummings, D-Md., have questioned the FDA about its review and approval of Emflaza. Marathon was granted approval of Emflaza as an orphan drug based largely on 20-year-old data from a trial conducted by another drug company. Marathon also received a priority review voucher from the FDA—which Marathon did not sell to PTC but could sell to another drugmaker for hundreds of millions of dollars. Emflaza’s status as an orphan drug gives it seven years of market exclusivity. The FDA says it is just following the laws set by Congress, but the agency itself writes the regulations for implementing those laws and has autonomy over its approval decisions.