ORLANDO — Insurers grappling with the million-dollar-plus costs of gene therapy have touted "value-based" payment arrangements that aim to pay on the basis of outcomes or downstream savings. But developers of hemophilia gene therapies believe they won't be widely subjected to them because the one-time treatments will be offset by long-term savings that could amount to tens of millions of dollars.
BioMarin Pharmaceuticals' hemophilia A gene therapy valoctocogene roxaparvovec (valrox) could be on the market in mid-2020, making the question of how to structure reimbursement an immediate concern for payers. But given the alternative of paying a half-million dollars a year on factor replacement therapies, they may be willing to agree to a simple one-time price with biotech companies, said Matt Kapusta, CEO of UniQure, which is developing a hemophilia B drug called etranacogene dezaparvovec (etranadez).
"More advanced, sophisticated value-based approaches to reimbursement will come in a matter of time. The question is when," Kapusta said in an interview with BioPharma Dive at the American Society of Hematology meeting. "Most of the [hemophilia B patients] at least in the United States are probably covered by systems where they're just not heavily managed.
"A population like hemophilia B with maybe 6,000 patients in the United States, they're just not managing the category like they do with diabetes or dyslipidemia," Kapusta said.
Given the cost of factor replacement therapies, hemophilia gene therapies have the potential to pay for themselves in just four or five years if they adopt the $2.1 million price of Novartis' spinal muscular atrophy (SMA) gene therapy Zolgensma.
"The simplistic clinical facts are that it takes anywhere from $650,000 to $750,000 a year in the U.S. now," Wing Yen Wong, BioMarin's vice president of clinical science, said in an interview during ASH. "And if I save you five years of that, you do the math."
The Institute for Clinical and Economic Review, in analyzing the potential cost-effectiveness of "single and short-term" treatments like gene therapy, said the potential lifetime savings from a hemophilia A gene therapy could avert between $90 million and $114 million in lifetime costs for patients who have developed inhibitors to standard factor replacement therapies.
That analysis suggested that even a price of $80 million would be cost-effective in this population, which represents a subset of severely ill hemophilia patients who need to increase the amount of blood-clotting factors.
A problem specific to U.S. insurers is the frequency with which patients switch plans related to employer-provided coverage. Anticipating this, Novartis offered to let insurers pay for Zolgensma over five years and reduce their payments if it didn't work, but so far, nobody has taken the Swiss big pharma company up.
Terminating payment because the drug fails or doesn't work as well as promised, or "outcomes-based payment," is itself a problem as it has the potential to trigger across-the-board payment cuts under the Medicaid program under best-price laws.
Spark Therapeutics, which has launched the gene therapy Luxturna for an inherited form of blindness, sought a waiver from best-price laws from the Centers for Medicare and Medicaid Services nearly two years ago, but the agency still has not made a decision, according to the company.
Kapusta said he believes that the magnitude of the potentially averted costs are much greater in hemophilia than in blindness or SMA, which should help its case with payers. Hemophilia gene therapies should be able to show much harder economic savings as opposed to the improvements in quality of life that Luxturna and Zolgensma provide.
"You start getting into more intangible means of trying to evaluate value," he said. "These are children that have devastating diseases and patients that have blindness, but it's a lot harder to point to specific economic value arguments."