ICER draws new gene therapy pricing framework

ICER draws new gene therapy pricing framework

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Dive Brief:

  • The Institute for Clinical and Economic Review on Tuesday said it will assess the value of pricey one-time and short-term curative treatments like gene therapies differently from standard drugs taken chronically because of uncertainties over both their costs and benefits over time.
  • Important adjustments include preparing both optimistic and conservative scenarios about the durability of the treatment and allocating cost savings in a way to prevent assessments that justify extremely high prices.
  • Two gene therapies have been launched in the U.S., and payers are grappling with ways to understand the long-term implications of high-priced treatments that potentially achieve a cure after a single dose.

Dive Insight:

Spark Therapeutics’ blindness treatment Luxturna (voretigene neparvovec) debuted with a $850,000 pricetag, followed by entry of Novartis’ spinal muscular atrophy infusion Zolgensma (onasemnogene abeparvovec) at $2.1 million.

In both cases, ICER, an independent group focused on measuring drug value, said the gene therapies were too expensive for the clinical benefit they delivered. (Although Zolgensma came close to meeting ICER’s thresholds using one measure of cost-effectiveness.)

However, ICER, along with many payers and policymakers, has acknowledged that gene therapies are so new it is not clear they will always represent a lifelong cure. In addition, an assessment framework based around drugs taken chronically, with ongoing costs, may not work as well for treatments that in theory will be taken only once to achieve their benefit.

Thus the organization, consulting with counterparts in other national health technology assessment organizations like the British National Institute for Health and Care Excellence, developed a separate approach to be used when evaluating “high-impact single or short-term therapies,” or SSTs.

That term means this framework will also be used with non-gene therapy approaches like chimeric antigen receptor T-cell (CAR-T) treatments such as Novartis’ Kymriah (tisagenlecleucel) and Gilead Sciences’ Yescarta (axicabtagene ciloleucel).

To account for the uncertainties about treatment durability and effectiveness, the new framework will prepare optimistic and conservative scenarios in order to get a clearer idea whether the new treatment’s price comes below the ICER threshold of $150,000 per “quality adjusted life year” — or QALY, a measure of patient benefit — gained over alternatives.

Likewise, to help payers decide whether a price is reasonable, assessments of one-time therapies will also include a discussion of how long the treatment will need to be effective in order to meet that $150,000 per QALY threshold.

When judging a new one-time or short-term treatment’s economic benefit over alternatives taken chronically, the cost savings could be enormous, which could potentially yield enormous one-time “value-based” prices. For example, an ICER technical brief suggested the savings could be used to justify a value-based price as high as $86 million for a hemophilia A treatment.

In order to account for this, the new framework will present an alternative pricing scenario that assigns only 50% of the potential future savings to the drugmaker in calculating a value based price, and allow 50% to be returned to health insurers.

ICER also will take into account patient views about the risks and benefits of alternatives. This is already relevant in treatment for SMA, where Biogen’s Spinraza (nusinersen) can also help improve patient outcomes, and Roche’s risdiplam could be on the market very soon.

In addition, future assessments will also discuss how undergoing a one-time treatment could affect patients’ ability to access future curative therapies.

“The potential advantage is related to what has previously been described as option value: the ability to benefit from future treatments that the patient would not otherwise have been able to receive,” wrote ICER in its report.

“The potential disadvantage is that some SSTs might, by their mechanism of action or triggering of immune responses, lead to a decreased chance at effective treatment by a future generation of therapies in the pipeline.”

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