Novartis gets approval to sell Kymriah in Japan for $306,000

* Novartis sees up to 7.2 bln yen of annual sales in Japan

* Global sales of Kymriah were $76 mln in 2018

* Novartis still tackling U.S. drug specification issues (Adds comment from Novartis, background)

By Takashi Umekawa

TOKYO, May 15 (Reuters) - A Japanese government panel approved on Wednesday a price of 33.5 million yen ($305,800) for Novartis' cancer treatment Kymriah, allowing the Swiss drugmaker to press ahead with a campaign to kick-start sluggish sales of the treatment.

The one-time, personalised therapy, which was approved in Japan in March, will be available in the country for young people with acute lymphoblastic leukemia (ALL) and adult patients with diffuse large B-cell lymphoma (DLBCL).

The so-called CAR-T therapy, which Novartis believes could treat up to 216 Japanese patients a year, potentially generating annual sales of 7.2 billion yen ($65.7 million), has been a hailed as a revolutionary, last-ditch hope for people whose cancer advanced after previous treatment.

But the Basel-based drugmaker has faced U.S. hurdles, largely for DLBCL patients, where challenges meeting commercial specifications have forced it to give some product away for free. Expanding to Japan, plus ongoing efforts to resolve the U.S. problems, are part of Chief Executive Vas Narasimhan's goal of turning Kymriah into $1 billion-per-year seller.

The U.S. specification hiccup is not an issue in Japan, a spokesman said.

"Our cell viability commercial specifications in the EU, Switzerland, Australia, Canada and Japan are now aligned with those from our clinical trials," the spokesman said. "We intend to continue to engage with the (U.S. Food and Drug Administration) to change our commercial viability specifications in the United States."

While the impasse has been a "disappointment," Novartis added its scientists had recorded comparable safety and efficacy even with Kymriah that doesn't meet FDA specifications.

"We continue to optimize our process and make incremental gains as we work toward our ultimate goal of providing this transformative product to patients in both indications, and have been able to deliver Kymriah to the majority of patients," the company said.

Kymriah works by removing disease fighting T-cells from patients, modifying them to attack cancer, and re-infusing them back into the patients.

The therapy belongs to a slate of advanced, costly therapies including gene therapy and cancer-fighting nuclear medicine that Narasimhan has either developed or bought via acquisitions as he maps out Novartis's future.

For U.S. patients, Kymriah costs $475,000 for those with ALL and $373,000 for DLBCL.

Global sales of Kymriah were $76 million in 2018, putting it well outside Novartis's top 20 medications. It's also shy of Gilead Sciences' Yescarta, another CAR-T therapy that last year posted $264 million in sales but which also missed analyst expectations.

($1 = 109.5400 yen) (Reporting by Takashi Umekawa; Additional reporting by John Miller in Zurich; Editing by Muralikumar Anantharaman and Mark Potter)