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Another gene therapy drug broke records in March, becoming the world’s most expensive drug. This served as a reminder to health systems that new thinking is needed to achieve market sustainability. Payers accustomed to the traditional pharmaceutical model new era Is it a one-time treatment?
Orchard Therapeutics List price $4.25 million Lemmerdi surpassed the previous record holder for a gene therapy for a rare disease completed in just one attempt, which was also a gene therapy. That treatment, by CSL Behring and uniQure’s Hemgenix, won approval in 2022 and was launched last year at a list price of $3.5 million. In fact, gene therapy has outperformed other treatments on list price since uniQure’s Glybera was launched in 2012 at more than $1 million per treatment. being pulled Only one patient received commercial doses outside of clinical trials.
Despite the shockwaves associated with gene therapy, the promise of effective treatments for difficult diseases remains. And the Institute for Clinical and Economic Review, an industry watchdog that examines drug prices in relation to the medical impact of treatments, is collaborating with Tufts Medical Center’s think tank on how to pay for the brave new world of ultra-expensive treatments. We investigated their options.
In just seven years, the FDA has approved 17 gene therapies, and a Tufts group called NEWDIGS estimates that by 2032, more than 85 new gene therapies will receive regulatory approval in 12 therapeutic areas.
inside White paper released last weekeach organization will explore how payers are working with pharmaceutical companies and others to facilitate further access to gene therapies while addressing the long and expensive development processes that have gone into making these treatments a reality. We considered whether we could collaborate with the patient.
fair price
ICER and NEWDIGS cite drug companies’ list prices as a key means to improve access to gene therapy. ICER’s cost-effectiveness model is one way he does this, by determining the value of medicines in terms of their impact on patients in both length and quality of life.
Prior to Lemmerdi’s approval, ICER had recommended a list price of $2.3 million to $3.9 million based on a “health benefit price benchmark.” Although Orchard’s final price tag was more than $4 million, exceeding ICER’s standards, the watchdog’s expert panel could not rule out the effectiveness of the treatment.
Additionally, once-in-a-lifetime gene therapy may be less expensive in the long run, as opposed to gene therapy that is used chronically for years. ICER and NEWDIGS noted that hemophilia treatments could be considered cost-effective by payers as much as $20 million. The disease is already costly over the patient’s lifetime.
But how much is too much? After all, small employers and programs like Medicaid don’t have unlimited funds, so they need sustainable reimbursement models.
ICER and NEWDIGS recommend “uncertainty discounting” of launch prices to account for the novelty of gene therapies. The cost-effectiveness of gene therapies is determined by analysis over five years to “share the financial risk between plan sponsors and manufacturers,” reducing prices at launch due to uncertainty and reducing those data points. can be recalculated when appropriate. It will be realized later in the treatment market life cycle.
Ethical concerns surrounding the “value” of human life have always made ICER’s work difficult, and the organization believes that any pricing model “will not be based on evidence in setting priorities and pricing levels for these treatments.” He does not deny that he emphasizes the “difficult interplay between values and values.” Report. But the line being drawn will be “shared savings” that will allow drug companies to match their return on investment with the benefits that gene therapy brings to society.
Milestones and subscriptions
One way to ensure that the cost of gene therapy reflects its value is to link price to outcome, and ICER and NEWDIGS show some ways this can be done.
The contracts could require full upfront payment with the option of rebates if the treatment does not meet expectations, the organizations said. Bluebird Bio’s sickle cell disease gene therapy Rifgenia is priced at $3.1 million, and payers who choose this option will have to pay for sickle cell disease complications within three years of patients receiving treatment. If you are admitted to the hospital, you will be given a rebate. Similarly, drug companies may provide guarantees against future payer costs incurred if a therapy fails to deliver on its promises.
A third option involves paying in installments over time, based on positive results.
But to make this happen, ICER and NEWDIGS said payers also need to be prepared for this type of strategy. According to the report, the Centers for Medicare and Medicaid Services needs regulatory clarity to adapt to new payment methods and build organizational capacity to do so.
For small insurance companies, a surprise multi-million dollar claim can have a significant impact on their overall budget, which is why ICER and NEWDIGS recommend insurance companies. Rather than eliminating coverage entirely, payers need to protect themselves from unexpected claims. Through “stop-loss” insurance.
Similar to pooling resources to pay high, one-time insurance claims, cross-payer subscription models have the potential to spread costs across a broader group of patients. Large payers such as Aetna/CVS, Cigna/Evernorth, and United Healthcare/Optum have their own versions of this model, called the “Financial Protection Program.” Although the premiums for these programs remain high, this model could become useful as more gene therapies enter the market, ICER and NEWDIGS said.
Finally, a federal public option could make gene therapy payments more sustainable, freeing up tax revenue and payer fees. However, ICER and NEWDIGS pointed to issues of inefficiency and potential for abuse in past iterations of this type of program.
As innovative gene therapies gain more traction in the therapeutic field, ICER and NEWDIGS are committed to increasing the number of these strategies through policy “stacking” that provides an optimal sharing model between pharmaceutical companies, payers, and patients. He said there is a possibility that two or more could be introduced at once.
