Value-based Arrangements

FDA Approves Second Gene Therapy, but Will Price Prove to Be Too High?

The FDA recently approved the second gene therapy for hemophilia B, Pfizer Inc.’s Beqvez (fidanacogene elaparvovec-dzkt). But while the manufacturer priced the agent at parity to the other treatment, that price may still be too high for many payers, according to a Zitter Insights survey.

On April 25, the FDA approved Beqvez for the treatment of adults with moderate to severe hemophilia B who use factor IX prophylaxis therapy; have current or historical life-threatening hemorrhage; or have repeated, serious spontaneous bleeding episodes and do not have neutralizing antibodies to adeno-associated virus (AAV) serotype Rh74var (AAVRh74var) capsid as detected by an FDA-approved test. The manufacturer launched a warranty program for the intravenous infusion based on durability of patient response to treatment.

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Amount of Medicaid Funds Flowing to MCOs Is Poised to Rise, KFF Predicts

Taking a look at the overall state of Medicaid managed care, KFF earlier this month compiled data from prior years of its surveys and analyses to identify notable trends. About 75% of all Medicaid beneficiaries are enrolled in risk-based managed care — with that percentage set to grow as Oklahoma transitions away from fee-for-service (FFS) Medicaid — and most states spend at least 40% of total Medicaid dollars on payments to MCOs. KFF noted that spending could increase as states shift higher-cost, higher-need beneficiaries, such as disabled individuals and adults aged 65 and older, into managed care. Moreover, most states (32 states including Washington, D.C.) with managed care carve in their pharmacy benefits to MCO contracts, observed KFF.

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Payers Continue to Employ Array of Specialty Drug Management Strategies

Rebates continue to be a huge part of the specialty pharmacy space, with 93% of respondents to a recent survey receiving them for drugs in the pharmacy benefit. Meanwhile, 44% of respondents said their firm received rebates for medical benefit drugs, representing an increase from 39% in the prior year’s survey. Those are just some of the findings in the Trends in Specialty Drug Benefits Report from Pharmaceutical Strategies Group (PSG), an EPIC company.

The 11th annual survey, which reflects 2023 information, was fielded from Sept. 18 through Oct. 13, 2023. The primary source of respondents was PSG’s proprietary database of drug benefit decision makers, and they included people from employers, health plans (or third-party administrators or insurance companies) or union/Taft-Hartley plans. There were 185 benefits leaders from plan sponsors with an estimated 86.6 million lives.

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‘Not a Fluff Piece’: AHIP, AMA, NAACOS Offer Actionable Valued-Based Care Tips

Payers and providers are increasingly adopting value-based care, although they need to continue to invest in the models and collaborate to make them work, according to a report released on April 10 by AHIP, the American Medical Association (AMA) and the National Association of Accountable Care Organizations (NAACOS). The 74-page report identified best practices for developing payment arrangements for value-based care, including establishing clearly defined contract terms and considering ways to incentivize payers and providers to participate and move away from fee-for-service arrangements.

“Our goal here — AMA, AHIP and NAACOS — is to identify these real world best practices, get those in the hands of health plans, of physicians and clinicians and the teams in general, the VBC entities, so that they can really absorb this information [and] take action based on it related to their own participation in these models, so that we can really scale this nationwide,” Danielle Lloyd, AHIP’s senior vice president of private market innovations and quality initiatives, said during an April 12 panel discussion at the NAACOS Spring 2024 conference in Baltimore.

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New Medicare, Manufacturer Coverage Are Among Solutions for Cell and Gene Therapies

Among the issues facing health care payers, paying for multimillion-dollar cell and gene therapies (CGTs) is one of the most pressing, as evidenced during AHIP’s 2024 Medicare, Medicaid, Duals & Commercial Markets Forum, held March 12 through 14 in Baltimore. While they were mentioned by multiple speakers throughout the three-day conference, speakers at one session focused on the topic said that while approaches such as short-term milestone-based contracts and risk pools are being used, no perfect solution has emerged yet.

Many CGTs are in the pipeline, impacting potentially millions of patients and prompting many questions around affordability and accessibility, stated Sean Dickson, senior vice president of pharmaceutical policy at AHIP, during the March 12 session, titled “Cell and Gene Therapies: Regulatory Updates and Coverage Policies.” “Oncology is where it will get really interesting,” and these agents will have the greatest impact on Medicare payers.

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Incorporating Pharmacy Spending in Value-Based Payment Models Remains Challenging

Payers face challenges incorporating drug spending into value-based payment models, making it difficult to reduce overall health care costs, according to panelists who participated in a session at the virtual Value-Based Payment Summit on Jan. 31. The speakers were encouraged with the increased attention being paid to expensive medications and difficulties in ensuring people take their prescriptions. However, they stressed that more needs to be done to educate providers and ensure pharmacy spending is in check.

Frank W. McStay, II, assistant research director at the Duke University Margolis Institute for Health Policy and the session’s moderator, noted the federal government and states have recently proposed and implemented policies to reduce drug costs and increase access to medications. For instance, the Biden administration on Jan. 30 announced that it planned to increase access to sickle cell treatments via the Cell and Gene Therapy (CGT) Access Model that CMS introduced last year.

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News Briefs: CMS’s Cell and Gene Therapy Model Will First Focus on Sickle Cell Disease

CMS’s Cell and Gene Therapy Access Model’s first focus will be on therapies for sickle cell disease, the agency said Jan. 30. The administration unveiled the model almost one year ago as one of three new models for testing by CMS’s Innovation Center to lower the cost of drugs and increase access to new treatments. The model will implement outcomes-based agreements (OBAs) for cell and gene therapies to treat sickle cell disease beginning in 2025 “and may be expanded to other types of CGTs in the future.” The administration estimates that about half of people with sickle cell disease are enrolled in Medicaid, with health care services costing about $3 billion annually. Through the model, CMS will negotiate OBAs, and states can decide whether to enter into the arrangements. “CMS will negotiate financial and clinical outcome measures with drug manufacturers and then reconcile data, monitor results, and evaluate outcomes. The CGT Access Model will begin in January 2025, and states may choose to begin participation at a time of their choosing between January 2025 and January 2026.”

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Payers Turn to Various Management Strategies for Cell and Gene Therapies

In December, the FDA approved the two newest cell and gene therapies, which were the first such agents approved for the treatment of sickle cell disease. As more of these products launch onto the U.S. market — the agency previously predicted that it would be approving 10 to 20 of the treatments by 2025 — payers are taking a variety of approaches to managing the therapies. Cost remains the main obstacle to their use, but their long-term durability also remains a question to some extent.

Dec. 8 saw the newest approvals, both for the treatment of sickle cell disease in people at least 12 years old: bluebird bio, Inc’s Lyfgenia (lovotibeglogene autotemcel; lovo-cel) and Vertex Pharmaceuticals Inc. and CRISPR Therapeutics’ Casgevy (exagamglogene autotemcel; exa-cel). The latter agent is the first CRISPR/Cas9 genome-edited cell therapy that the FDA has approved. The FDA gave both applications priority review, orphan drug, fast track and regenerative medicine advanced therapy designations. It also gave Lyfgenia rare pediatric disease designation.

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Aetna, Humana, SCAN Share Priorities for Investing in MA Members’ Care

From Star Ratings and risk model changes to a significant overhaul of the Medicare Part D benefit that will take effect over the next few years, Medicare Advantage insurers this year must anticipate the potential impact of major changes and ensure their products and services continue to satisfy members. Investment priorities highlighted by three influential MA carriers include digital solutions, member engagement strategies and value-based care.

Humana Inc., for one, took a “thoughtful approach to bids to ensure we were meeting members’ needs while balancing the rate environment,” says George Renaudin, president and Medicare and Medicaid. That included maintaining or enhancing key benefits that were identified by consumers and brokers as most critical to members, such as $0 premiums, dental and Part B “givebacks.”

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Payers Report Taking Varied Steps to Manage Cell and Gene Therapies

The FDA recently approved the two newest cell and gene therapies, with one of them earning the distinction of being the first of its kind approved by the FDA. As more of these products launch onto the U.S. market — the agency previously predicted that it would be approving 10 to 20 of the treatments by 2025 — payers are taking a variety of approaches to managing the therapies.

Dec. 8 saw the newest approvals, both for the treatment of sickle cell disease in people at least 12 years old: bluebird bio, Inc’s Lyfgenia (lovotibeglogene autotemcel; lovo-cel) and Vertex Pharmaceuticals Inc. and CRISPR Therapeutics’ Casgevy (exagamglogene autotemcel; exa-cel). The latter agent is the first CRISPR/Cas9 genome-edited cell therapy that the FDA has approved. The one-time treatments come with hefty price tags: Lyfgenia is priced at $3.1 million and Casgevy at $2.2 million.

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