Market Access, and with it Pricing & Reimbursement models, has become an integral part of opportunity assessments for novel drugs and therapies. Nicolas Touchot, head of groupH’s Market Access practice, has looked into the feasibility and desirability of a number of reimbursement frameworks for gene therapies and potential other novel premium priced future therapies.
Below is a summary of his article published in the September issue of Nature Biotechnology.
To obtain the full article please follow the link below;
The payers’ perspective on gene therapies: Nature Biotechnology, September 2015 (Vol 33:9, 11-13)
The Western world’s first gene therapy, Glybera launched in Germany at an initial €1.1 million price tag, a new record for a medicine to treat a rare disease. Several other gene therapies are in late stage development and both large pharmaceutical and biotech companies have been building their internal capabilities and striking multiple partnerships. The financial community has also shown great appetite driven by the promise of high drug prices and recurring payments. The current conventional wisdom for Pricing and Reimbursement of gene therapies builds upon two premises:
- Gene therapies provide long-term or definitive benefits. Therefore pricing them as multiples of the yearly cost of expensive drugs such as protein replacement therapies is justified. This leads to prices in excess of $1million or $1.5 million per treatment
- A new reimbursement system is required to absorb such high prices. The most likely approach is a capped annuity with risk-sharing, allowing health systems to spread the cost along several years and to limit risk if efficacy is not maintained
Unfortunately, these premises are strongly questioned by the people who ultimately carry the financial burden of gene therapies, the payers:
- The concept of a capped annuity is theoretically attractive but impossible to implement in current health care systems
- Pricing a gene therapy as a multiple of the yearly cost of expensive protein replacement therapies is considered highly artificial and unjustified
In this article Nicolas Touchot from groupH, and Mathias Flume a leading German payer, detail why the payers’ view differs from that of other industry stakeholders, and provide alternative approaches developed through discussions with selected senior payers in the US and large European countries.