New Payment Solutions Presented at ASGCT Policy Summit Could Help Offset Costs of Gene and Cell Therapies

As new gene therapies continue to move from development in the lab to patients in the clinic, new financial models will be required to pay for these one-time, potentially durable treatments. Speakers on the second day of the ASGCT Policy Summit discussed innovative payment strategies that they believe will help offset the cost of gene therapies and ensure more people gain access to these treatments.

For traditional medicines, there’s an alignment between the benefit the drug provides and the cost. Gene therapies create challenges because the benefit is spread out over time and the large payment up front can be difficult for smaller payers. Additionally, a disconnect occurs when patients move between payers.

One way to make the payment process more efficient is the Orphan Reinsurer and Benefit Manager (ORBM). The ORBM serves as an intermediary and provides some of the benefits of reinsurance or risk pools and some of the benefits of operational management. This strategy is useful for smaller payers who may not have the expertise or resources to manage patients with rare diseases, said Dan Mytelka, director of policy and simulations at the Massachusetts Institute of Technology New Drug Development Paradigms (MIT NEWDIGS) program.

ORBM participants would pay a per-member-per-month fee. The amount would depend on the agreed-upon scope of diseases covered and services provided, Mytelka said, which might vary based on the needs of the payer. The system would ideally be largely invisible to consumers.

The ORBM model may also help solve the problem of patients moving in and out of health plans. If a therapy is paid for under a performance-based contract, there’s a need to track patients if they move among plans when they relocate or change jobs.

Creating an ORBM is “a chicken and egg issue,” Mytelka said, because there need to be enough products on the market to manage the overall overhead cost of putting the system together. A handful of groups around the country are currently developing ORBMs.

Another payment model discussed during the session, the Embarc Benefit Protection program,  has served as a model for ORBM, Mytelka said.

Under the program, patients would have no copayments related to the cost of the medicine and would receive personalized care to assist them through their journey, said Rob Osborne, vice president of trade relations, Accredo Specialty Pharmacy and CuraScript SD.

Embarc, which was introduced by Cigna in September, is initially intended to cover the FDA-approved gene therapies Zolgensma and Luxturna. More gene therapies may be added in the future. Health plans, employers, and unions participating in the program would pay per-member-per-month for a gene therapy network. Physicians would submit a prior authorization and patients would get the medication with no out-of-pocket expenses. Pharmacies and sites of care would then be paid for the drugs through Embarc.

“We want the patient to have the benefit and predictability and peace of mind,” Osborne said.

Express Scripts, which merged with Cigna in December, is currently working to build operations around the program and offer it to plans.

“We are looking to be able to offer this opportunity to any payers on the marketplace regardless of size,” Osborne said. “We want to make it simple, affordable, and predictable for payers.”

In other news from the ASGCT Policy Summit on Nov. 5:

• Kaha Hizanishvili, of MassHealth, and Chethan Bachireddy, M.D., of the Virginia Department of Medical Assistance Services reviewed Medicaid reimbursement approaches for gene and cell therapies in their respective states
• Consultants Anna Griffin and Jugna Shah discussed Medicare reimbursement for CAR T-cell therapy 
   

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