The U.S. Food and Drug Administration (FDA) has approved pharmaceutical company Bristol Myers Squibb’s (BMY) new schizophrenia drug called “Cobenfy.”
The medication is the first new treatment for the chronic mental health disorder in more than 70 years and highly anticipated by both doctors and patients.
Schizophrenia causes auditory hallucinations and impacts a person’s behaviour. In extreme cases it can lead to paranoia and emotional breakdowns.
People with schizophrenia often have trouble going to school or work, as well as difficulty socializing. Most people are diagnosed with the disease in their late teens and early 20s.
Nearly three million adults in the U.S. live with schizophrenia, but only about half of them (1.6 million) are receiving any treatment for the condition.
Cobenfy is a pill taken twice a day. The company said it will be available to prescribe and purchase by late October of this year.
The medication will cost $1,850 U.S. for a month’s supply or $22,500 U.S. annually, though it should receive coverage under most health insurance plans in America.
Analysts say that Cobenfy could provide Bristol Myers Squibb with a big sales boost in coming years and has the potential to become a blockbuster medication.
In a research note, analysts at Guggenheim said Cobenfy should be a “multi-billion-dollar opportunity” for Bristol Myers Squibb.
Bristol Myers Squibb acquired Cobenfy through its $14 billion U.S. purchase of biotech company Karuna Therapeutics at the end of 2023.
The stock of Bristol Myers Squibb was up 4% on news of the FDA approval of Cobenfy. In the last 12 months, the company’s share price has declined 13% to trade at $50.12 U.S. per share.