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Asembia 2019

New Innovations and Cures Require Overhauling Insurance and Benefit Design

Laura Joszt
Healthcare is very comfortable with treating a disease, but it’s not as good with handling cures. However, the advent of gene therapy and precision medicine means more and more expensive cures are coming down the pipeline, said panelists on the last day of Asembia’s 15th annual Specialty Pharmacy Summit, held April 29 to May 2 in Las Vegas, Nevada.
Healthcare is very comfortable with treating a disease, but it’s not as good with handling cures. However, the advent of gene therapy and precision medicine means more and more expensive cures are coming down the pipeline, said panelists on the last day of Asembia’s 15th annual Specialty Pharmacy Summit, held April 29 to May 2 in Las Vegas, Nevada.

What is currently in the market is mostly in the oncology space, and both Charles Collins, MS, MBA, president, Healthcare Stakeholder Solutions, and Cheryl Allen, BS Pharm, MBA, vice president of industry relations, Diplomat, discussed chimeric antigen receptor (CAR) T-cell therapies, which are lifesaving treatments that have very high price tags. In addition to the opportunities these treatments offer, it’s important to understand the challenges.

“It’s amazing where we’re going, but we don’t want to stop that innovation, but there is a lot of things to consider,” Collins said.

For instance, one of the big unknowns is the long-term efficacy of these treatments. Does the gene remain activated? What is going to happen in 2022? Payers are concerned with the answers to these questions, because they might be paying $1 million for the treatment. While the treatment itself might cost $350,000 or $475,000, there are ancillary associated costs before and after treatment that can bring the total cost to $750,000 to $1 million for CAR T-cell therapy.

“From the payer side, when they’re looking at real-world evidence and trying to look at applying this to the patient it can be quite challenging,” Allen said.

These early CAR T-cell therapies are also first generation and they require a lot of monitoring, she added. What manufacturers are working toward are second-generation to fifth-generation therapies that have the potential to be off-the-shelf treatments that can be delivered in the outpatient setting. There are also current logistical issues with the production of CAR T cells because only a few sites in the country can manufacture these agents.

The pipeline is growing, though. Among the few that Allen highlighted were treatments for hemophilia, multiple myeloma, and Duchenne muscular dystrophy. The technology is advancing rapidly, but it is far ahead of the payment mechanisms currently available today.

“I think the fear is that the funding for this type of innovation might dry up if we don’t figure out how we’re going to pay for this,” Allen said.

Collins believes everyone wants to do the right thing and make these cures available to patients, but it’s a matter of presenting a new payment structure to the health plans. One option he suggested was annuity payments, like how a mortgage is set up, with the treatment being paid off in 5 annual payments instead of 1 lump sum at the beginning. The costly nature of these innovative treatments will require insurance and benefit designs to be reworked in some way, he said.

Real-world evidence and long-term efficacy data are going to be important, Allen said, but another question that needs to be answered is how a cure is defined from a value-based perspective. Is a cure something that lasts for 3 years or 5 years or 15 years? And what happens if the treatment is paid off after 5 years and it fails at 10 years? “Where’s the reimbursement for that?” she asked.

Collins is optimistic about the future, and he thinks the whole healthcare system needs to look at how to overhaul the current, antiquated system that was built when cures were not an option.

“I don’t think the train’s going to stop,” he said. “We’re moving forward, and we want to move forward. We need to move forward.”

 
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