How Costs Impact Utilization for Hemophilia CGTs
When the FDA approved the first cell and gene therapy (CGT) for hemophilia almost two years ago, it represented a massive leap forward in treating the bleeding disorder. The one-and-done agents offer the promise of a cure, giving patients the prospect of freedom from the disease without regular treatments.
Although three hemophilia CGTs are now on the U.S. market, access has not yet met expectations, and only a handful of patients have received treatment to date. These therapies have been slow to pick up market share due to their costly price tags, despite manufacturer-provided warranties that offer full or partial reimbursement if the agents lose their efficacy.
For decades, people with hemophilia were administered regular intravenous infusions of clotting factor, often several times a week. Those treatments have evolved from donated plasma to synthetic factors, with extended half-life options coming to the market more recently, as well as non-factor agents such as the bispecific monoclonal antibody Hemlibra from Roche’s Genentech. Although these agents are not providing a cure for hemophilia, many patients can manage the condition with them.
The new CGTs, however, replace a faulty gene that causes hemophilia, helping patients produce clotting factor on their own. For the very first time, they have the potential to cure the disease. And while some newer hemophilia treatments have managed to lengthen the time between doses to one week, two weeks or even a month, that can’t compete with a single dose of a CGT.
So why aren’t people using them?
Costs Exceed ICER Fair Pricing Benchmarks
In less than two years, the FDA has given the green light to three hemophilia CGTs, all with multimillion-dollar list prices.
In April 2024, the FDA approved Pfizer’s Beqvez for the treatment of adults with moderate to severe hemophilia B. The price for the single-dose gene therapy is $3.5 million — the same price as the first adeno-associated virus (AAV) vector-based gene therapy for hemophilia B, CSL Behring and uniQure’s Hemgenix, which was approved in November 2022.
That price makes these agents the second most expensive drugs in the world behind Lenmeldy from Kyowa Kirin subsidiary Orchard, which was approved in March 2024 for metachromatic leukodystrophy and is priced at $4.25 million.
BioMarin’s Roctavian gene therapy for hemophilia A, which also uses an AAV vector, was previously approved in June 2023. That agent has a one-time price of $2.9 million.
Those price tags are higher than recommended by the Institute for Clinical and Economic Review (ICER). In a report published in December 2022, the group determined that the health benefit price benchmark for Roctavian be capped at $1.96 million, while Hemgenix’s HBPB was capped at $2.96 million.
The agents’ manufacturers have maintained that the prices are necessary due to CGTs’ complex production and one-time use as opposed to lifetime treatment. Average annual costs for clotting factor therapies for a patient with severe hemophilia total around $300,000, and medical expenses double that amount. In addition, patients who develop inhibitors could run up bills north of $1 million in a single year.
Given the cumulative costs of treating hemophilia, a one-time multimillion-dollar payment seems more reasonable. But for payers, it may be easier to rationalize paying smaller amounts on an annual basis. It’s also important to remember that when a person receives a CGT, the total cost exceeds the price of the agent, as it includes diagnostics and the ancillary processes and procedures needed to administer the therapy.
Durability Concerns and Manufacturer Warranties
The durability of the agents is a big question as well. ICER, for instance, projects that one Hemgenix dose should last 20 to 25 years, while a single dose of Roctavian should be effective for only 10 or 11 years. A second dose of the hemophilia CGTs is currently not an option for patients, as AAVs can produce a severe immune response. Given this, payers may reason that they would soon be back to providing coverage for factor or another agent for the rest of a patient’s life.
Because payers must cover the full cost for the hemophilia CGTs up front, the manufacturers all are offering warranties to make that investment more palatable:
- Based on the “durability of patient response to treatment,” Pfizer’s warranty program for Beqvez aims to “provide greater certainty to payers, maximize access for eligible patients who receive Beqvez, and offer financial protection by insuring against the risk of efficacy failure.”
- Roctavian also offers an outcomes-based warranty guaranteeing reimbursement of up to 100% of the wholesale acquisition cost. The agreement is good for the first four years of treatment, and BioMarin will reimburse payers on a prorated basis for any patient who does not respond to the agent during that time.
- Hemgenix also has a similar arrangement, with CSL Behring offering “a substantial rebate to payers” if a patient must use prophylactic factor within three-and-a-half years of infusion with the therapy.
Although these warranties and rebates were designed to help payers feel comfortable paying for the treatments, they have not been enough.
According to insights from MMIT’s Message Monitor solution, payers have expressed concern about how long the warranties last, preferring longer periods of time in case a patient relapses 10 years later. Payers also said they need assurance of financial protection in the event that a patient switches payers/PBMs. In addition, payers require more detailed information about how patients are monitored and how to logistically work through the warranty, including working with a third-party insurer.
Payers Balk At High Costs, Outcomes Uncertainty
Although hemophilia CGTs are generally covered by payers (approximately 70% to 80% for both Hemgenix and Roctavian), payer push-back on the brands’ high prices is reflected in the quality of this coverage. For example, both Hemgenix and Roctavian have <15% of commercial and Medicaid lives covered to label, with restrictions including requirement for prior therapies and/or exclusion for history of other diseases.
To assess payers’ perspectives on CGTs, MMIT’s 2Q 2024 Managed Care Biologics and Injectables Index report surveyed 35 commercial plans covering 116.0 million lives, plus 27 Medicare plans covering 45.1 million lives. One payer with 24.3 million covered lives said that CGTs’ “extremely high cost with modest benefit” was a reason for the high unmet need in treating patients with them. Almost half of the respondents said that CGTs have a very high budget impact.
When asked about challenges their organization faces while determining CGT coverage, almost all respondents (94%) cited the agents’ costs as their top concern, while 80% pointed to the lack of long-term outcomes.
Two-thirds of respondents said they were likely to increase their aggressiveness in managing CGTs by engaging in alternative methods of contracting, such as outcomes-based contracts, with manufacturers. One payer said it would take a more restrictive management approach to hemophilia CGTs in particular due to competition within the class.
Payers identified reinsurance, including stop-loss insurance, as the primary method in mitigating cost risks associated with CGTs. This approach is aligned with what the warranties are offering.
Need For Innovative Reimbursement Strategies
Hemophilia CGTs are amazing innovations that can cure a disease that has impacted patients for generations. Their high price tags, however, are clearly limiting utilization. For the almost two-thirds of commercial health plans that are self-insured, paying for just one CGT could blow up their annual budget. Because of this, some plans actually are considering excluding coverage of CGTs altogether.
With other innovative (albeit noncurative) therapies available, such as Sanofi and Sobi’s Altuviiio, payers have options to not automatically cover or prefer CGTs. From the payers’ point of view, why not continue to pay less over a longer period of time? And why make such a significant investment in a CGT treatment just for a patient to switch plans?
Various pricing and reimbursement arrangements are being explored to pay for CGTs, but these are not without issues. Payers need to align with manufacturers on what patient metrics are satisfactory for these agreements. And even then, tracking a patient’s results over time can be burdensome and difficult.
Despite these challenges, it seems that achieving equitable, affordable access to gene therapies will likely require an innovative, collaborative approach to reimbursement and risk. Manufacturers must work with other industry stakeholders to find a solution to pay for the agents to ensure that patients can benefit from these revolutionary treatments.
For actionable insights into payer and IDN perspectives on gene therapies, learn more about MMIT’s Message Monitor solution.
