There is a new most expensive drug in the world. Price tag: $4.25 million

There is a new most expensive drug ever—a gene therapy that costs as much as a Brooklyn brownstone or a Miami mansion, and more than the average person will earn in a lifetime.

Lenmeldy is a gene treatment for metachromatic leukodystrophy (MLD) and was approved in the U.S. on Monday. Its maker, Orchard Therapeutics, said today the $4.25 million wholesale cost reflects the value the treatment has for patients and families.

No doubt, MLD is awful. The nerve disorder strikes toddlers, quickly robbing them of their ability to speak and walk. Around half die, the others live on in a vegetative state causing crushing burdens for families.

But it’s also incredibly rare, affecting only around 40 kids a year in the U.S. The extreme rarity of such diseases is what’s behind the soaring price-tags of new gene therapies. Just consider the economics: Orchard employs 160 people, much more than the number of kids they’ll be able to treat over several years.

It means even at this price, selling the newest DNA treatment could be a shaky business. “Gene therapies have...