Cell and Gene Therapies

As manufacturers continue to bring more advanced therapies onto the U.S. market, payers are grappling with how to afford these agents. And while the products may be life-changing for some patients, they may not have the desired outcome in others, leaving payers on the hook for an unsuccessful treatment. This has resulted in various contracting opportunities, including warranties.

While such agreements can make payers more confident in their coverage of treatments, particularly high-cost ones and products whose effectiveness or durability are uncertain, they also are beneficial for pharma companies, which are seeing utilization of their therapies.

Most industry experts would agree that paying for costly cell and gene therapies (CGTs) is one of the top issues facing payers. And with more than 4,000 gene, cell and RNA therapies in the pipeline, the issue isn’t disappearing any time soon. One relatively new company is taking a slightly different approach to tackling the issue.

Quantile Health is focused on increasing patient access to CGTs, explained Yutong Sun, co-founder and CEO, during AHIP’s 2024 Medicare, Medicaid, Duals & Commercial Markets Forum, held earlier this year in Baltimore. As almost one-third of self-insured plans have dropped their coverage of gene therapies, the company is focused on this sector of the health care marketplace, which faces “quite different challenges” than other entities, she said. While CGTs may be “a drop in the bucket” for major national plans with annual budgets of a few billion dollars, one CGT could represent half of the annual budget for a self-insured plan with 100 to 500 employees.

A recent Avalere Health analysis found that some managed Medicaid insurers have stricter policies for cell and gene therapies than fee-for-service Medicaid programs, even though the authors cited a federal regulation that “requires MCO coverage policies to be no more restrictive than FFS policies.” Despite that regulation, Margaret Scott, an Avalere principal and report co-author, says it is “a little bit of a gray area” whether MCOs need to abide by that mandate.

“That really isn’t defined very well either in regulation or in any guidance from CMS,” Scott tells AIS Health, a division of MMIT. “We also see that a lot of states don’t actually review the clinical coverage criteria that are used by their MCOs. It may not come to a state’s attention that a particular MCO may have stricter coverage criteria unless they receive a complaint from a beneficiary.”

The Food and Drug Administration’s top gene therapy regulator issued what he acknowledged is a “provocative” call to consider setting a “target product profile” for gene therapy that includes not just what is expected from a clinical perspective, but “what we need to expect out of them from an economic perspective and from a clinical benefit perspective versus cost perspective.”

The FDA, by virtue of legal mandates and historical precedent, tends to avoid discussing the costs of novel medical interventions. But when a senior leader like Center for Biologics Evaluation and Research Director Peter Marks discusses cost-effectiveness tradeoffs, eyebrows raise.

Most industry experts would agree that paying for costly cell and gene therapies (CGTs) is one of the top issues facing payers. And with more than 4,000 gene, cell and RNA therapies in the pipeline, the issue isn’t disappearing any time soon. One relatively new company is taking a slightly different approach to tackling the issue.

Quantile Health is focused on increasing patient access to CGTs, explained Yutong Sun, co-founder and CEO, during AHIP’s 2024 Medicare, Medicaid, Duals & Commercial Markets Forum, held earlier this year in Baltimore. As almost one-third of self-insured plans have dropped their coverage of gene therapies, the company is focused on this sector of the health care marketplace, which faces “quite different challenges” than other entities, she said. While CGTs may be “a drop in the bucket” for major national plans with annual budgets of a few billion dollars, one CGT could represent half of the annual budget for a self-insured plan with 100 to 500 employees.

Otezla (apremilast) is available in the U.S. for the treatment of pediatric patients 6 to 17 years of age and weighing at least 20kg with moderate to severe plaque psoriasis who are candidates for phototherapy or systemic therapy, Amgen Inc. said Aug. 20. The FDA approved the agent for that use on April 25 while also registering an additional packaging facility to support new packaging configurations for the pediatric population.

Bluebird Bio Inc. disclosed during its second-quarter earnings release on Aug. 14 that it has had only four patients start treatment with Lyfgenia (lovotibeglogene autotemcel), a gene therapy for sickle cell disease (SCD) that the FDA approved in December. While company executives claimed there was still strong patient demand and payer interest for the treatment, Wall Street analysts noted the launch was slower than expected and called into question the ability of the medication to make an impact in the market.

Bluebird executives also said they’re encouraged with the strides they’re making in discussions with payers, but admitted it was “too early to tell” if the drug will run into any coverage issues.

July 8: The FDA approved ANI Pharmaceuticals, Inc.’s L-glutamine oral powder to reduce the acute complications of sickle cell disease in people at least 5 years old. The company says it is the first AA-rated approved generic for Emmaus Medical, Inc.’s Endari. Dosing for people weighing less than 30 kilograms is one packet twice daily; for those between 30 and 65 kilograms, dosing is two packets twice daily, and for those more than 65 kilograms, dosing is three packets twice daily. Drugs.com lists the price of 60 packets of Endari as more than $1,505.

Former Wells Fargo employees sued the company on July 30, alleging the financial firm overpaid for prescription medications covered by its prescription drug plan, STAT reported. The proposed class action lawsuit alleges Wells Fargo failed to satisfy its “fiduciary obligations at multiple steps in the process of administering prescription drug benefits” as mandated under the Employee Retirement Income Security Act of 1974, and that it paid excessive fees to The Cigna Group’s Express Scripts PBM. The lawsuit, filed in the U.S. District Court for the District of Minnesota, is similar to one filed in February by a Johnson & Johnson employee. Both suits cited a STAT investigation from June 2023 that detailed the relationship between PBMs and consulting firms, which may raise concerns about conflicts of interest. Wells Fargo and Johnson & Johnson each use Express Scripts as their PBM and Aon as their drug benefits consultant.

When benefits managers from a range of employers gathered at the Midwest Business Group on Health’s (MBGH) recent forum in Chicago, the final session of the day revealed that specialty drugs were some of their top concerns. And it appears employers are getting savvier about managing them.

A big focus of the conference was benefits managers’ fiduciary duty to their employees — and how shirking that duty could land them in hot water.

“If you haven't done a market check, do a market check,” recommended Dan Dentzer, manager of health and wellness design for United Airlines, at the June 26 MBGH Employer Forum on Pharmacy Benefits, Specialty and Biopharma Therapies. “I do market checks like I change my socks because you have to know what's going on out there. You have to know what others are doing. You have to know you're getting the best deal possible. If you haven't done that, please do.”