You have to compare with the base iPad, which costs only about half of the Neo. The Neo adds a keyboard (but without Touch ID for the base model), a larger screen but without touch, a somewhat better but also binned SoC (which the next iPad refresh will very likely also get) and more storage. It seems roughly in line, relative to the price difference.
It's more expensive if you want Touch ID, and on par ($350 + $250) if you don't. However, the $250 Magic Keyboard is heavily overpriced, the actual keyboard can't be more than $10-20.
