Repurposing biosimilars, rethinking costs: a framework for sustainable drug pricing for repurposed bevacizumab for intravitreal injections

Abstract

Bevacizumab, originally developed by Genentech under the brand name Avastin® as an anti-cancer drug, has gained widespread off-label use in ophthalmology due to its similar mechanism of action to other anti-VEGF treatments and its significantly lower cost compared to available on label alternatives for ophthalmological indications. While off-label bevacizumab has been standard in clinical practice for over a decade, recently, a repurposed formulation (brand name: Lytenava®, Outlook Therapeutics Ltd), developed specifically for vascular retinal conditions, received marketing approval from the European Medicines Agency. This raises questions about what the price for a repurposed formulation should reasonably be, reflecting the efforts to obtain regulatory approval. This paper examines potential cost-based-plus pricing for such a repurposed formulation of bevacizumab using a novel pricing framework across four scenarios. By evaluating the pricing structure through an analysis of critical cost components, including, among others, research and development expenditures, manufacturing costs, and cost-of-capital, the study proposes a price range of €73 to €177 per injection. The explicit breakdown of these cost components provides valuable insights into the economic structure of repurposed biosimilars like bevacizumab, emphasizing how a cost-based-plus pricing model can support more transparent and informed negotiations between pharmaceutical companies and healthcare payers. Ultimately, this approach contributes to the development of pricing strategies that balance affordability for healthcare systems with sustainable returns for manufacturers while fostering the broader development of repurposed treatments. The findings of this paper aim to advance the dialogue on equitable pricing for repurposed therapies.