How Expensive is Too Expensive: Gene Therapy Treatment to Test the Waters
(Thursday, August 18, 2022)
At $2.8 million per patient, the recently approved gene therapy treatment from Bluebird Bio is one of the most expensive treatments approved by the FDA. While developers may justify the cost of such treatments, is there an appetite with the payors for covering such treatments? Without coverage practically no patient can afford to pay for such treatments. The same treatment was withdrawn from Europe for lack of coverage by insurance. The high price of the treatment has two justifications. First, it is a one-shot, life-long gene therapy treatment for an ultra-rare disease, transfusion dependent thalassemia (TDT), with only about 800 potentially eligible patients in the US. Of these about 800 patients with TDT, less than a third are enthusiastic to receive it, a third have said that they will not want it as they are happy with the standard of care, and the rest want to wait to see any major side effects in the treated individuals. Hence that leaves the potential market for the treatment to about 200-300 patients total who will use it only once in their lifetime. Making it a very small and limiting market. Second, the standard of care for TAT could cost about $6 million over the life of the patient. So, the cost of the treatment is about half of the expected life-time cost via the standard of care. But that’s a tough argument to make to an insurance company. Insurance providers cover the cost of treatment year by year and no individual maintains the same insurance coverage for their entire life giving any insurance company little assurance of recouping their cost. Second the treatment was tested in a total of 41 patients over 12 months, making any extrapolation to life-long therapy challenging for the medical and patient community. The treatment carries very serious potential side effects such as blood cancer, mucositis, febrile neutropenia, vomiting, pyrexia (fever), alopecia (hair loss), epistaxis (nosebleed), abdominal pain, musculoskeletal pain, cough, headache, diarrhea, rash, constipation, nausea, decreased appetite, pigmentation disorder and pruritus (itch). None of these side effects are seen with the available treatments. The treatment worked in 89% of the participants in the clinical trial, so there is a 1 out of 10 chance of the treatment not working. To its credit, the company has offered an 80% rebate for those patients in whom the treatment failed. Overall, a very challenging financial proposal. The company will monetize the technology via its Priority Review Voucher, which may fetch about $100 million, and establishing a proof-of-concept for future gene therapies where the market may be larger and the per patient cost be lower. For now, we will soon find out if the treatment has a practical outcome different from that in Europe. May be a treatment that failed financially in Europe would succeed in the US. The company certainly feels that way. For those looking at the high price of cell and gene therapy treatments, this would be test of the appetite of the payers and patients, if it becomes covered, for such high-priced treatments.
Dr. Mukesh Kumar
Founder & CEO, FDAMap
Linkedin: Mukesh Kumar, PhD, RAC