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NEW YORK, Dec 20 (Reuters Breakingviews) – Biogen (BIIB.O) said on Monday it will cut the price of a newish drug for Alzheimer’s from Jan. 1. Wall Street had already mostly given up on the therapy, amid questions over whether it even works and glacial uptake – sales were well below $1 million last quarter. Biogen’s market value, at $35 billion, is below where it was prior to U.S. approval of the therapy in June.

It’s rare for pharma firms to cut prices. Prices are hiked on hundreds of drugs every January. That said, the initial price of $56,000 per year for Biogen’s drug was too high. The Institute for Clinical and Economic Review, whose estimates are followed closely by insurers, said it was cost effective at no more than $8,400 per year.

A lower price might persuade some insurers and government programs like Medicare to cover the cost of the drug based on the hope read more it does something. Investors previously assumed the drug was dead when Biogen stopped a clinical trial in 2019 and when a Food and Drug Administration panel voted against approval in 2020. With failure again baked in, there’s potential upside if Biogen can squeeze something out of it. (By Robert Cyran)

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