Hello, everyone. Now we'd like to start Eisai's conference for media and investors. Thank you very much for joining today out of your very busy schedule at the beginning of the new year, in spite of the short notice. On January 6th, U.S. time, our treatment for AD, lecanemab, or LEQEMBI as its U.S. brand name, was granted accelerated approval by U.S. FDA. This morning at 4:30 A.M. JST, we issued a press release related to the accelerated approval and a statement on our U.S. pricing and the rationale behind, and LEQEMBI, a safety statement from the Global Safety Officer. At 1:30 P.M., we filed a partial change application from the accelerated approval to full traditional approval. In this conference today, we'd like to explain our thinking behind the pricing for LEQEMBI. Today's conference is organized both on-site and online in a hybrid fashion.
We thank on-site participants for wearing a face mask to prevent COVID-19 infections. Those joining on-site can find in your handout, four types of documents, including a release and statements, and the supplementary materials for the presentation today. Please check the handout. Those joining on Zoom can refer to our website to see the supplementary materials posted on our website for your reference. Today, simultaneous interpreting is available between Japanese and English. Let me introduce the presenter today, Director, Representative Corporate Officer, and CEO, Haruo Naito. We will start the presentation, but we are keeping sufficient social distancing. Please allow him to take off his mask during his presentation. CEO Naito, the floor is yours.
Thank you very much. I'm Naito. As was just introduced, now with regard to the product, LEQEMBI, that we have been able to receive the accelerated approval by U.S. FDA. Based upon that, in the week of January 23rd, we are planning to launch the product in U.S. On the day of the accelerated approval, again, we have been able to achieve the submission aiming at the full traditional approval in the United States. Based upon this context, we have decided on the price of the product in the U.S. market. On this occasion, I would like to explain the rationale behind this. Please refer to the headline of the release.
The Eisai's approach to U.S. pricing for LEQEMBI, U.S. brand name for lecanemab, a treatment for early Alzheimer's disease, sets forth our concept of societal value of medicine in relation to price of medicine. As I will state later on, as the societal value of medicine, $37,600 is being set. However, we set our price at $26,500. Another important statement is that as indicated in the subtitle, we are trying to pursue the maximization of the value for all stakeholders. At the same time, we want to give back this societal value back to the society. These are the fundamental basic concept behind our pricing policies, and that is indicated in this title of this press release.
I would like to read out this news release. Furthermore, I'd like to give some additional remarks. Based upon our corporate philosophy of HHC concept, Eisai is committed to improve patients' health outcomes and quality of life and to simplify the care delivery and to increase the health system efficiency and spur future investment in Alzheimer's disease. This time, in the United States, we have received accelerated approval for LEQEMBI as an early AD treatment, and for which, with regard to the value evaluations and pricing, and we wanted to maximize the values for all stakeholders, including patients, families, caregivers, healthcare providers, payers, employees, and shareholders. These are all the stakeholders that we have. To all of these stakeholders, we want to find a way to try to maximize the value.
To this end, we are applying the very holistic approach. There are three values to this. Clinical, the values, as well as the societal, the values. That is the benefit that we deliver to patients and families and caregivers. Also the economic values that we offer to the society through the reduction of the healthcare services needs, and also the global burden of disease to be reduced. Also, we want to make sure is that we can contribute to further enhancing the innovations in AD. These are the values that we are pursuing here. Social impact of AD in the United States. Third-party group, according to the Alzheimer's Association, came up with the statistics, and I would like to refer to that here.
In 2022, estimated 6.5 million Americans age 65 and older are living with dementia due to AD, including mild, moderate, and severe dementia stages of AD in year 2022. AD was listed as the sixth leading cause of death in U.S. in 2019. Right now it is the 7th leading cause of death because of COVID-19 pandemic. It is a chronic and progressive, and this is actually disabling and fatal disease.
According to another report from the Alzheimer's Association, should there be no treatment that exists to delay the AD's disease, then the total cost of care in the United States from all payers, including Medicare, Medicaid, out-of-pocket, and other payers, would increase from $267 billion in 2020 to $451 billion in 2030. According to this 2020 study, as many as 10-14 million Americans living with MCI. I talked about 6.5, that is the AD populations, but now I'm talking about mild cognitive impairment populations. Out of this populations, 55% of them have AD, that is MCI due to AD, the patients.
In this study, it is estimated that if a treatment that can slow the progressions from MCI to mild or mild to moderate dementia by as much as 30%, it should result in the lifetime the value of $134,418 per person in the United States. This is the kind of context I would like to bear in mind. Based upon that, I would like to go on to discuss the value of LEQEMBI adoption in the U.S. society. LEQEMBI is the treatment of AD, and as seen in the clinical trial, the treatment with LEQEMBI should be initiated in patients with MCI or the mild dementia stage of AD after confirmation of amyloid beta pathology, that is, early AD patients.
In the United States, we estimate that such diagnosed and eligible early AD population indicated for AD-DMT, disease-modifying therapy, should be reaching in three years' time, approximately 100,000 individuals. This is the current estimate. That is eligible patients for AD-DMT in three years' time would grow to approximately 100,000 in the United States. If minimally invasive new screening and diagnostic technologies such as blood-based biomarkers could further advance going forward. Therefore, this the population, eligible population is expected to increase gradually over mid to long term. I would like to give some supplemental explanations by referring to this slide. This the largest circle graph indicates the prevalence of early AD, including the potential early AD patients.
From here, again, the patients would need to seek for the medical attentions and have to be diagnosed with early AD. Therefore, in this process, the potential patients in the circle one would need to be motivated to seek for the medical attentions and also would have to be diagnosed. When they go to the medical institutions and should be diagnosed with early AD, and then comes the amyloid beta testing. The amyloid beta positivity needs to be confirmed in the patients. When you go to the number three on the right-hand side of the slide, currently amyloid beta testing is done either by PET or CSF. Both in the United States as well as in Japan, I think that the situation is quite similar.
That is to say that, when it comes to, this, indications approved for these testing or whether these testings are reimbursable by the insurance or not. Currently, we are faced with rather inadequate situations. Therefore, now that we have new treatment available, and based upon that, this, insurance coverage and reimbursement situations for the amyloid beta testing is something that should be further, improved, and that is something that we are expecting for. Of course, you can do the testing by CSF, but this requires the lumbar puncture. You need the needle, the shot, on the spine, and this would require some technical, training. So amyloid beta testing certainly is accompanied by many different challenges, but I'm expecting the rapid, the improvement all of these fronts.
At the same time, as indicated at the bottom, the cheap and convenient blood-based biomarkers are currently under development. The Japanese manufacturers indeed have a very high level of technologies in this field. It needs to be inexpensive. It needs to be very convenient for this kind of the testing. Should this be made available in the clinical practice by around 2025, we are hopeful that those biomarkers would be rendered available for the clinicians. From the amyloid beta testing, there will be a significant increase in the number of patients who could be indicated for the AD-DMT kind of treatment. When the amyloid beta positivity is confirmed in the stage four and goes into this treatment phase in number five.
There again, between the physicians in charge and family members and patients together, there needs to be the close communications and then finally move into the treatment. Quite often, what happens is that this population in the prevalent population in number one is multiplied by proposed price and the enormous amount of the sales revenue projection would be discussed. However, this is quite misleading. When it comes to the revenue projection for the AD-DMT, including lecanemab, would have to be based upon the population in number five, which is much smaller than the population you can see in number one, which should be multiplied by the proposed price. That's something that I hope that people would better understand.
Based upon the population in number five and then sales projection, potential sales projection for AD-DMT would not be the kind of enormous burden for the healthcare treasury or healthcare funding of different countries. That's what we think. Going back to the text. Published findings in the peer review journal from the confirmatory phase III Clarity AD in early AD demonstrate. This is, I'm talking about The New England Journal of Medicine, which is, of course, the very top-notch world-renowned journal. That demonstrate that LEQEMBI treatment resulted in less decline on measures of cognition and function than placebo at 18 months. That is to say the primary endpoint. At 18 months of CDR-SB, we saw the 27% of the slowing of decline. When it comes to adverse events profile was pretty much within our expectations.
This, the result of the study were quite consistent with the late phase II trial, that is Study 201, which was the basis for the FDA's accelerated approval. Now we are making the advancement in the traditional approval submission for FDA. Now, LEQEMBI's clinical data show that it can help patients remain cognitive functions and preserve activities of daily living and maintain function abilities much longer, and therefore, could potentially translate into impactful benefit for the patients and their families. Based upon the patient background and findings from the clinical studies, in order to project the trajectory of cognitive decline of individual AD patients, the disease model, AD Archimedes Condition Event Simulation, AD -ACE model, was used in the simulation study.
With this, we assess the lifelong care value and potential economic effect for early AD patients brought about by the LEQEMBI treatment. With regard to AD is the model. This may not be quite widely known, the model, but the outcome of this study has already been carried in a peer review journal. Also we saw the very consistent result with the update of the data from the Clarity AD data. Traditionally, the Markov model would quite often be used for this kind of modeling. Compared to that, for this model, the patient individual background, that would be entered into this model so that the patient trajectory for the individual patient can be projected. Data entry is indeed the enormous work.
However, when you think about the patient heterogeneity, and this is the model that can more accurately reflect the patient, the background to come up with more accurate, the projections. This, I think is a great advantage of this model of AD-ACE. Based upon that, in the United States, the societal value of LEQEMBI in the United States is now estimated at the $37,600 per year. LEQEMBI treatment is predicted to delay the disease progression, resulting in an increase in the patient's expected time in early AD, while reducing the time in more advanced severities. The slowing of clinical decline on treatment is estimated to delay the disease progression by nearly three years on average compared to the standard of care.
Delay of the progression mainly from MCI to mild AD, or in the case of the mild AD patients, the progression to moderate AD. This kind of progression, the phases can be delayed by as many as three years compared to SOC. LEQEMBI's impact on the disease trajectory is then modeled into annual per patient value. The current value to U.S. society based upon the following components. Actually, there are four components. A is quality adjusted life years. QALY gains. This is the index used in the HDA, the Health Technology Assessment. Quality adjusted life years gains is evaluated compared to SOC. Another factor is willing to pay. The willingness to pay threshold. WTP threshold, which I would like to dwell upon later on. C is the cost offsets compared to SOC. D is time on treatment.
These four factors would be used to derive this annual per patient value, and they all are discounted into the present value term. This, the formula. Annual per patient value, you have to look at the QALY gained times the WTP threshold plus cost offset and then divide it by time on treatment. This would give the annual per patient value. Again, this is I know this is kind of complicated, but I would like to use some actual numbers to explain this further. QALY. This is a health outcome value index. Health is the function of length of life that you can enjoy and the quality of life. This measure combines both attributes into one single index, with one QALY gain represents one additional year of a person's life at perfect health.
Based upon the AD-ACE model analysis, with LEQEMBI's treatment, it is as predicted to offer an additional 0.64 QALYs compared to SOC for an early AD patients over lifetime, by improving outcomes for both patient and caregivers. From the start of the treatment, throughout the life, the total QALY should be about four, generally. However, with the lecanemab treatment, we expect the increase by 0.64 QALY. Actually, this is quite a significant health outcome improvement. At least that's how we look at this. B is willing to pay threshold. This is more or less a simplistic concept. When you achieve this full one year of perfect health, how much are you willing to pay? This is the amount that is being indicated here.
Usually, and conventionally, the WTP threshold is based upon one to three times of the country's GDP. In the United States, WTP's threshold of $50,000 to $100,000 to $150,000 would be referenced as the cost effectiveness threshold.
For the gravity of conditions with greater burden and interventions that exhibit wider societal benefits such as AD, then much higher WTP of $200,000 of WTP threshold per quality gain is used in the United States. Now, cost offset, total cost offset. We have to really look at both direct and indirect cost and make the comparison between SOC and LEQEMBI. Direct cost include the medical cost as well as the indirect cost that would be the cost incurred for the family members. The direct cost contain the cost of medications, the medical visits, hospitalization, living accommodations, and community service for the patients. Indirect costs of caregivers consider the monetary value for hours spent on caregiving activities. You make the comparison between LEQEMBI and the standard of care.
With LEQEMBI, you can save as much as $7,415 with the treatment of LEQEMBI. The fourth factor. The time on treatment. LEQEMBI was modeled to be stopped upon transition to moderate AD or worse. With the current discounted values, it amounts to 3.6 years. Going back to the formula. A is 0.64 QALYs gained and the threshold is $200,000 per QALY gain. Cost offset, $7,415. They all show the current values. Yearly per patient value of LEQEMBI from a societal perspective was quantified at $37,600. $37,600 of yearly values. Now, we have to also look at the lifetime value. This numerator, 0.64 times the $200,000 plus the $7,415, that is $135,400 would be lifetime values.
Alzheimer's Association also came up with the projection. Actually, it just so happened that they came up with the almost the same number as the lifelong value. LEQEMBI's treatment amongst the early AD patients is now expected to continue for about 10 years, and we expect the number of the indicated patients to further increase over 10 years. This clinical value in delaying the disease progression and projected social value that help improve patients' and caregivers' quality of life and productivity, plus simulated economic value that help reduce the demand for health services. When we take them all together, we believe that LEQEMBI would generate the positive impact to U.S. society worth several tens of billions of dollars. At least it should have that much of potential. That's what we believe.
I'm talking about the yearly value. comes the business pricing, the launch price for LEQEMBI, which is now set at $26,500. While we estimate the per patient, per year value of LEQEMBI treatment to the U.S. society to be $37,600, Eisai decided to price LEQEMBI below qualified societal value at wholesaler acquisition cost, the so-called WAC, of $26,500 per year. Based on Study 201 and Clarity AD, estimated annual price is based on 10 mg/kg IV bi-weekly for average U.S. patient weight of 75 kg, aiming to promote broader patient access, reduce overall financial burden, and support health system sustainability. As such, the WAC for 200 milligram vial is $254.81, and the WAC for 500 milligram vial is $637.02. Actual annualized pricing may vary by patient because of different body type.
In addition, Eisai continues to pursue less frequent maintenance dosing regimen for LEQEMBI, such as monthly instead of current bi-weekly regimen, upon significant amyloid beta clearance to prevent a reaccumulation of amyloid beta biomarkers while maintaining clinical efficacy. This could further lower the yearly cost of LEQEMBI during the maintenance dose phase.
If it's a monthly maintenance regimen, the cost would be reduced by around half. This could further lower the yearly cost from $26,500 to potentially about half of this figure given less amount of drugs. I'd like to talk about patient affordability. When the price is set at $26,500, what is going to be a patient affordability? Eisai believes patient affordability must be a key consideration to promote patient access and intended use and benefits of LEQEMBI. Innovation and access is the role of the modern pharmaceutical companies. We have to achieve innovations. We have to ensure access. That is a major important role to be played by us.
Among the eligible early AD patient population in the United States, once the patient's insurer covers LEQEMBI, we estimate that approximately 91% of individual will be covered by Medicare with Medigap supplementary insurance, Medicare Advantage, Medicare-approved plans from private companies with potential supplemental coverage, or Medicaid are managed by states and commercial private insurance. For these patients, their out-of-pocket costs for LEQEMBI treatment could range from zero to a few dollars per day. Remaining 9% of the individuals will fall into the category of Medicare beneficiaries without supplemental insurance, and hence, will be responsible for 20% of the LEQEMBI cost as co-insurance under Medicare Part B. For these patients, the estimated out-of-pocket costs for LEQEMBI will translate into about $14.5 per day.
Across the entire eligible early AD patient population, we estimate the weighted co- average out-of-pocket costs for LEQEMBI to be about $2 per day. We will implement initiatives to enhance patient access. Eisai is committed to ensuring these, that certain financially disadvantaged patients have access to LEQEMBI. Firstly, Eisai is establishing a patient assistance program which will provide LEQEMBI at no cost for eligible uninsured and under-insured patients, including Medicare beneficiaries who meet financial need and other program criteria. Among the 9% of the patients I mentioned earlier, I believe there will be some who will be eligible for this program. Secondly, Eisai will offer patient support for improving access through LEQEMBI patient navigators who will provide information about accessing LEQEMBI, helping patients and their families understand their insurance coverage and options, and identifying financial support programs for eligible patients.
We provide meticulous support to enhance their access. I'd like to use material two to give you a supplementary explanation. This is the Eisai patient support with this logo. We will provide a meticulous support for the patients under this program. On the left, you see the patient assistance program. We will provide LEQEMBI for eligible uninsured and under-insured patients, including Medicare beneficiaries who meet financial need and other programs criteria at no cost. 9% of the patients will pay a 20% of the cost. Some of them will be eligible for this program. We can provide LEQEMBI at no cost for them. The average out-of-pocket cost by patients could possibly be reduced further. On the right, LEQEMBI patient navigator is explained. Each patient will have a patient navigator as a point of contact geographically assigned to them.
We provide a variety of information and extend swift support. We provide information on insurance coverage, identify financial support programs for eligible patients, and provide information on new insurance options through the LEQEMBI patient navigator to enhance a patient's access further. I'd like to go back to the statement once again. Next, about health system sustainability. We believe our pricing approach for LEQEMBI would also help improve health system sustainability, which is projected based on appropriate use of LEQEMBI in eligible patients with early AD to improve patient's health outcomes and quality of life, reduce demand for health services. Global burden of disease through changing disease trajectory, because we can expect the slowing of the disease progression. We can curtail the spending for the health system to enhance its sustainability.
Furthermore, we believe our pricing approach for LEQEMBI, coupled with the size of the targeted patient population, will be sustainable under historical growth and spending assumptions for Medicare Part B. ADMT, including LEQEMBI, sales forecast will not apply a big pressure onto the country's health finances. Last but not the least, giving back more than half of LEQEMBI value to U.S. society. As I mentioned, the price of LEQEMBI at a yearly cost of $26,500 compared to the projected society value of $37,600, is going to be $11,100 lower. A less frequent maintenance dosing regimen will further lower the yearly cost of LEQEMBI well below the projected societal value over time.
With a time span of 10 years from now, taking these savings as well as discounts and rebates within the U.S. healthcare system into consideration over 10 years' time span, cumulatively, the gradual adoption of LEQEMBI treatment at this pricing approach could give back about 60% of the potential positive social impact of several tens of billion dollars to the U.S. society. About 60% of the potential positive societal impact of several tens of billion dollars will be given back to the U.S. society. These resources could help realizing new innovation that enhance the health and quality of life for individuals at risk of developing AD or those living with AD, as well as their families and caregivers.
Less than half or about 40% of potential positive societal impact of several tens of billion dollars will be accrued by employees and shareholders in the form of product sales. From which we are committed to reinvest in future research and development to create new AD therapies and new innovations, such as establishing ecosystems toward inclusive AD communities. We deeply believe that our pricing approach to maximize value for all stakeholders will help Eisai achieve social goods in the form of relieving anxiety over health and reducing health disparity according to our corporate philosophy. I'd like to use material three to talk about the social impact, giving back 60% to society and 40% to be accrued by employees and shareholders. Today, I gave you a variety of numbers.
Where each number is applied is going to be briefly explained for your better understanding. Please look at the pink box. Social impact, several tens of billion dollars. How did we calculate this figure? This is very simple. On the upper left, you see annual societal value per patient, $37,600, multiplied by the number of patients treated with LEQEMBI. I cannot say the actual figure for the number of patients treated with LEQEMBI. This calculation would lead to several tens of billion dollars. 60% will be given back to the U.S. society, and 40% will be accrued in the form of product sales, not profits, by employees and shareholders with a 60/40 ratio, percent ratio. We'd like to allocate this amount to these stakeholders. We have calculated the annual net price per patient.
As I explained earlier, there's going to be the initiation or the introduction of the maintenance dosing, so the amount of dosings, the annual net price will decrease over time. The WAC is the launch price. That's before rebate deductions. We give rebate amounts to the government, so the net price is after rebate deductions. We have $26,500, and then the annual net price. The annual net price is going to be lower over years. We have the lifetime value of $135,000 divided by time on treatment of 3.6 years, divided by the annual net price per patient, and multiplied by the number of patients treated with LEQEMBI, whose number cannot be disclosed right now.
Multiplied by annual net price, is the social impact of several tens of billion dollars, which is going to be allocated 60% to the U.S. society and 40% to the employees and the shareholders. That is going to be the societal value creation and giving back to society through LEQEMBI. This $26,500 is the U.S. LEQEMBI price. In other regions and countries, there are respective health systems and pricing rules. There's going to be pricing according to those rules. With this, I'd like to finish my presentation. Thank you very much for your attention.
Next, we'd like to move into the Q&A session. First, we'd like to entertain the questions from those people in this room, and then, one by one, we'd like to receive the questions from those people connected online. Those who want to raise questions in this room, please raise your hand, and we are going to bring the microphone. Please state your name and affiliations. Because of the time limitations, please ask only one question per person. Muraoka-san, please.
We will let everybody ask questions.
Muraoka from Morgan Stanley. Congratulations for the approval with a very clean label. Since I can ask only one question, would like to discuss the pricing to come in the future, perhaps in one year time after launch. Once the subcutaneous formulation that you're currently developing, and I think it's probably like a 10 mg weekly dosing would be most likely. Once the SC formulation comes into the market, $26,500, with a simple calculation, it's going to double the cost. Even with the SC formulation launch, is it correct to understand that the yearly cost would remain unchanged?
The yearly cost would never go above $26,500. The net price going forward is expected to decline, including SC formulation. That's what we think. Thank you.
Thank you very much. Next person. The person in the second row from the window side.
Oka from NHK. I have a question to CEO Naito. The launch price in the United States for Eisai, do you think that you kept the price at a low level? As you explained from our CEO, what's your perception and what do you feel about this pricing level?
For the past 20 years or so, value-based pricing concept in the pricing of pharmaceutical, I think this is the basics in my view. The value is not just the medical value, but social value as well as other values to evaluate the value of pharmaceuticals in my view. In U.K., there is NICE for health technology assessment. It was one of the early phase of HDA. We communicated with NICE as well. When it comes to value-based pricing, by regulators as a rationale for pricing, it's not broadly utilized yet.
For our LEQEMBI value-based pricing, we think should be questioned to society. Value-based pricing suggests it's not the pricing for $37,650. More than half or 60% of the value is to be returned and given back to society. The remaining 40% would be accrued by employees and shareholders, which are also important stakeholders in our view. We are going to allocate the amount to these groups through this allocation. That's why we calculated the price of $26,500.
Using value-based pricing as a basic, we considered giving back to society in this pricing for the LEQEMBI. When you consider giving back to society in the pricing, what do you mean by that in simple terms? Payers and the government, there are rebates and others to be given back to them. At the same time, for patients and their family members, as I said today, medical, clinical value, economic value and social value in this AD-ACE model are all taken into account in this $37,600. Part of this, 60%, is to be given back to society. Second row.
My name is Tokumitsu, Economic Department of Kyodo. Congratulations for today. You talked about the return of benefit back to the society, but having said that, in the United States, not limited to U.S., but also in Japan as well as in Europe, I think that you probably have a very good positive prospect for the coming approach. In view of that, at this point in time, what is your view of the impact that would have on your the economic top line of your company and the business performance together with the ADUHELM?
We expect that in three years' time, the expected number of patients will be like 100,000. For the total AD- DMT, out of which, how much of the share that LEQEMBI can achieve is of course something that we don't know. At least in United States in three years' time, the estimate is that the patient population will grow to 100,000. In 2030, as is indicated in the circle number five, it is estimated that 2.5 million, the patients would fall into this population as designated in number five. This is the global numbers. Of course, China, India, all these big Asian countries. Let's say that blood-based biomarkers may be rendered for the clinical practice. That is the basic assumption here.
By 2025, the population designated number five would grow to like 2.5 billion. That's sort of our current projection. Of course, I cannot share with you any further details. Of course, at the time of the yearly financial meeting, I would like to explain more in detail.
Just your sentiments of your expectations, how much of the impact are you expecting this to generate for your company's performance?
Immediately post the launch. You cannot really expect a rapid increase in the profit, the bottom line. From the second half or second year and the third year, I expect this product to contribute to bottom line. After that, we expect it to have a very positive contributions to our business performance.
Next person. A person in the third row, please.
Yaguchi from The Asahi Shimbun Newspaper. Regarding the procedures in the United States, you already filed your submission for full traditional approval on the same day of accelerated approval. In areas or countries other than United States, anything you can discuss today? For example, in Japan, what is going to the pace to realize this to the practical use in Japan? I don't know whether you can talk about the pricing in Japan, but if there's anything you can explain, I'd like to hear.
Regarding the approval of timing, Nakahama is going to respond. I'm going to comment on the pricing a bit. Nakahama in charge of Regulatory Affairs in Japan.
Thank you for your question. As for the filing in Japan, after the full approval of filing in the U.S., we'd like to aim for filing in Japan as soon as possible. Since March last year, using the preliminary pharmaceutical assessment system with PMDA has kindly started a review of some of the data. As for the approval timing, it's up to the regulatory authorities, but we would like to aim for approval to be obtained by the end of this year. That's my response to the timing of approval. As for the pricing, today, we are talking about the pricing in the U.S.
With regards to the pricing in Japan, the drug calculation system, there is a totally different system. In principle, in line with that, NHI drug pricing system, with regulatory authorities-On the governments, we'd like to discuss with them. This is an innovation originating from Japan. As I said, also to Japanese society, there's going to be a huge societal impact in Japan as well. Value base or value creation is the concept. We are hoping to discuss. That's our wish. We are hoping to have lots of discussions. In Japan, there is a good pricing system. We understand that that's the basic principle we should follow. It's independent from the U.S. pricing to determine the pricing in Japan.
Thank you very much.
Thank you. Next person.
Takei from Yomiuri Newspaper. As was discussed before, and there was the questions about the submission timing in Japan, but as of today, according to your press materials, you're aiming at the submission before the end of this year. Once again, I would like to ask Mr. Naito to speak on this. Are you also agreeing on the submission before the end of the year, or do you have any more specific ideas, like before the end of February? Once again, I would like to repeat the same questions. Ms. Nakahama has already said that she would like to aim at submission as early as possible.
That's very important. Every day matters. With that much of the sense of desperation that we're working on the early submission as much as possible, I hope you will understand and accept our response as such.
Well, would it be possible that you may be able to file before the end of this month? Would it be totally out of picture for you to submit this month?
As early as possible.
I don't know how far away from the actual, the goal that we have, but. You can look me in my eyes and thank you.
Next question. A person in the second row.
This is something you expected, but still congratulations. Just one question I can ask, right? Good news and bad news. On Saturday morning comes, as you said before, this time. At around what time do you come to know about the approval? Did you see the EPC to see the display of the approval information by FDA, or where were you when you got the news? How did you feel? I'd like to know more details about that particular scene.
Can I explain? Well, there was a telephone call at around 3:30, close to 4:00 A.M. from Ivan Cheung. I was sleeping. I knew there can be a telephone call. I responded to the call immediately. There was a mention of the congratulations. There was one teardrop coming out of my eyes. Usually, I don't shed tears. There was one drop of tear from my left eye.
Did you have a smartphone or mobile phone at your bedside?
Yes.
Great.
Next person.
Igarashi Jiji. Congratulations. You mentioned that the different countries do have different pricing system and also in Japan has its own drug pricing system, which you would follow. Of course, you talked about the importance of looking into the societal value. In Japan, as you move into the process of pricing of this product, the kind of approach that you have introduced in the United States, that is 60% of the societal value can be returned back to the societies. Do you think that kind of concept can also be possibly be reflected into the pricing in Japan?
First of all, this kind of pricing approach, when you want to try to apply this to the Japanese society and you look at the annual values to be estimated, as soon as possible, internally at Eisai, we have to study this. Then comes the negotiation with the regulatory authorities. Of course, we want to bring those ideas on the table, but to what extent they are going to reflect that into the actual pricing, that's something I don't know. It's pretty much up to this, the concept of the regulatory and pricing authority. At least I would like to give it a try to make that kind of a challenge. To what extent we can reach an agreement is something I really have no idea about right now.
Next, person in the second row. Rather, in the first row.
Osakabe from Nikkan Yakugyo. Congratulations. Compared to the actual price you set the launch price by $11,100. Could you elaborate on the rationale for the pricing?
Please remember the slide I showed at the end, towards the end. Can you show the formula? There are known numbers. On the left top, $37,600. Number of patients treated with LEQEMBI, which is not disclosed. If you multiply these two, you can come up with a societal impact of several tens of billion dollars, divided into 60% and 40%, and 40% would be accrued in the form of product sales. Assuming time span of 10 years, the annual average price would decline over time, but initially it's going to be $26,500. That's our calculation.
Thank you very much.
Next person.
Thank you very much for your presentations. My name is Yoshimitsu, Chemical Daily. I'm sure that as you launched LEQEMBI, and what would be the challenges to really that you have to overcome both in Japan as well as in the United States, to implement this whole treatment paradigm in these markets?
LEQEMBI's. Including Clarity AD data, we have been able to build up a very robust data. When it comes to the societal value creations, we know that we have been able to generate very impactful data. I don't think there are any kind of factors that would really hamper the introduction of this product. How about other areas, like you talked about testing?
Well, talking about that aspect, of course, healthcare infrastructure, when that is not fully established in those markets, then how are you going to confirm the brain Aβ aggregations? Of course, the PET testing may not be quite sufficient, and also there may not be doctors who are familiar with the CSF sampling. In such a case, of course, they would not be able to make the confirmation of Aβ in the brain. That would certainly hamper their treatment of the patients with this drug. However, there are patients needing this kind of treatment in those markets. Even in a limited way, certain, the kinds of efforts would need to be made in order to improve on the patient access. That's something that we have to work on.
At the same time, those are the kind of things that need to be worked upon by the respective societies. For instance, like in Thailand, with insurance companies or with financial institutions, we are collaborating with them. Venture medical, the funding is something that we are trying to seek for. With the approval of LEQEMBI, I'm sure that we should be able to push such initiatives further going forward, and that's what I'm hoping to achieve. Thank you very much.
Next.
Onishi from The Nikkei Shimbun Newspaper. This may be a silly question, but as was mentioned in the earlier response to another question, you said there was one drop of tear from your eye. How did you feel when you shed a tear?
I don't know. A teardrop just came out of my eye. Usually it doesn't happen. Clarity AD results were announced, I didn't shed tears. Many did cry, Clarity AD results were announced, and at that time I didn't cry. This time there was an approval. This is really a huge thing for a pharmaceutical company to be granted with approval. We achieved results and our efforts were officially approved and accepted with a big stamp. We think this can happen. This is an afterthought, just one drop of tear to wet an area under my eye.
The next person.
My name is Sakaguchi from Iyaku Keizai. Simple question. About the peak sales projection for this product, what is your current estimate?
I cannot give you the specific number, but I expect the peak to come after 2030. Eligible patients for the AD-DMT, and we expect in the world 2.5 million patients to be eligible for AD-DMT treatment. That's our assumption.
Other than that, I don't know how much more you can derive from these numbers. At least for the time being, these are the only numbers that I can share with you. When the opportunity mature and the regional breakdown of the eligible patient number, that kind of information, when the time comes, we would like to share such information with you all. Amongst the eligible patient number, amyloid beta confirmation would be needed. Of course, to what extent it can be tested, that would vary from country to country. Whether the PET testing is available or the biological, I mean, the blood-based biomarkers development stage by 2030 would be very different. Based upon all these assumptions, we are trying to come up with a very realistic projections.
Globally, what I can say is that there will be about 2.5 million eligible patients. Going further, I'd like to share with you further information.
We'd like to move on to questions from those joining on Zoom. If you have a question, please press raise hand button. We try to take accept your questions now. The first person is Mr. Yamaguchi from Citigroup.
Can you hear me?
Yes, please.
Congratulations. Yamaguchi from Citigroup. I have one question. Aside from the pricing in California, ICER published certain numbers. The assumptions in detail are different, models are different, I'm not going to compare. In the case of ICER, quality was not so different, but the actual price was set much lower according to my memory. I'm not saying which is good or bad, the difference is because of the different models being used.
Many of the participants may want to know this, so this is my question.
Regarding this question, Tomita, in charge of this, is going to respond.
Thank you for the question. I'm from Value and Access. Regarding in the ICER, I-C-E-R, made the analysis, we'd like to appreciate their analysis. At ICER, there's a model they're using and the data to build the model, the cohort data, and the data to be input into the model are different from ours. This would lead to different results. Comprehensively, to capture the value is the same. In principle, our major difference was a difference in the models. Also cohort data handling was different as well. In particular, we used AD-ACE model, and AD disease course is heterogeneous, and we wanted to reflect this more appropriately. That's why we decided to adopt this.
The cohort data as a component, we use data reflecting a diversity. I think, because of this usage, there was a difference.
Understood. Thank you.
Next, Mr. Wakao of JP Morgan. I hope you can hear us.
Thank you. I'm Wakao from JP Morgan. Thank you very much. Thank you very much for a really clear presentation. About the fourth slide, several tens of billions of dollars of social impacts is to be accrued, approximately 40% of that as the product sells. Possibly it would lead to, like, $12 billion or so of the product sales. With that as the basis, when you think about the total number of patients treated, that is going to be very important. In view of that, this was the accelerated approval based upon the phase II study data. The label turned out to be very clear. What I'm concerned about is the label based upon the full approval. I would like you to give us your thought.
The Clarity AD certainly included the wide-ranging, the patients in the study. Once it is accepted, the product can be used more widely in the market. However, in the stock market, there are some, the patients suffering from, the microhemorrhage while they're on the antithrombotic and anticoagulant agents, then there may be some concerns about this. About this, the targeted, indicated patients and what kind of label do you think you will end up with? If you can share with you some thought, we'd appreciate that. With regard to this question, the Global Safety Officer, Geary, would like to respond to that question.
I'm Geary from, the Global Safety Officer. The approved label from the FDA includes consideration of all of the safety events which occurred during the clinical development program of LEQEMBI. The summary review that was published by the CDER, the division of the FDA also includes explicit consideration of all of the safety events which have been in the news recently this year for patients who were in the extension program. For that reason, we believe that the label already considers those safety events and does not include any boxed warnings or any prevention of use of concomitant anticoagulant drugs. Thank you.
If I may add some remarks. As to the efficacy and safety of LEQEMBI at FDA, they have been vetting this very carefully in this accelerated approval, 5.1 approval. With regard to the hemorrhage event, there is a very clear description included. Therefore, when it comes to the efficacy and the safety of LEQEMBI, the overall profile of this product remains unchanged in terms of their understanding. Which is that we are convinced that the benefit far exceeds the benefit.
Thank you very much. I have been able to fully understand.
We are running over. Among those who are still raising their hands, we'd like to take their questions. Jefferies Securities. Mr. Barker. Mr. Barker from Jefferies Securities, please unmute yourself.
Yes. Barker from Jefferies Securities. Regarding the sales and marketing structure from now on, compared to ADUHELM, are you going to launch in a different way? I'd like to receive your comments on this.
Regarding this question, Global AD Officer Ivan Cheung is going to respond. Ivan, please.
For your question, this launch in the United States will be a carefully designed phased launch approach. What I mean by that is the initial phase will be from now on until we have the CMS restriction lifted. Which of course, we have confidence to do so as today we also submitted for full approval, which will expedite the process towards CMS lifting that restriction. In this initial phase, we'll have a very focused approach focusing on getting the health systems, the ecosystems and the patient journey ready. A lot of work to do, but these activities will pave the way for the next phase upon the CMS lifting the Medicare restriction on coverage for Medicare beneficiaries. We will go into a full launch mode across the country.
Having said that, this launch will be done through an omnichannel approach. A modern approach to ensure that we could get the appropriate patients with support, with the healthcare systems onto LEQEMBI. Then there could be the next phase when we have other catalyst events, such as the availability of the subcutaneous auto-injection formulation and the wider adoption of a blood test to confirm amyloid pathology, that will be the scaled-up phase. This is gonna be our approach in the United States. Thank you.
Thank you.
Mr. Kagemoto from Yomiuri Newspaper, please unmute yourself.
I'm Kagemoto from Yomiuri Newspapers. With regard to the material number 1, the respective number of patients in each circle one to five. You talked about the 100,000 patients to be treated in the United States. What is your projection of the treated patients in Japan? Do you have any kind of estimate for the number of patients in each category? The number one, we do have the good estimate of number in Japan. Would anybody on that side, do you think you can give us any kind of a number there?
Tomita would like to respond to that.
In Japan, of course, there are many different epidemiological data available, but approximately 5.5 to 6 million people, is expected to be the number of patients in number one. As for the number five, as I have been trying to explain, we are not in the position to be able to give you any specific number of patients here. When time comes and when we are ready, we would like to share this information with you. Please bear with us for the time being.
Thank you very much.
Hyodo, from Toyo Keizai.
Can you hear me? Regarding the accelerated approval by FDA, they said they're going to respond by January 6th. Approval could have been granted earlier than this. For CEO Naito, you achieved this result today.
Is that what you expected or upon assessment or evaluation, it took time to review? Could you comment on the timing?
There was no major issue. COVID-19 is spreading right now. Because of such impact, there was a shortage of manpower, as I heard. Ivan, correct? Ivan. Ivan?
Yes. The FDA is working very hard, coming out of the New Year holiday, on this file. We are very grateful for their on time decision today on the accelerated approval. Thank you.
Okay. Thank you very much. Well, with this end, we would like to adjourn.