Dr Scott Gottlieb: Paying Over Time for Expensive Therapies

Providing access to complex therapies through the Medicare market can benefit patients who are disproportionately ignored by socioeconomic status, said Scott Gottlieb, MD, former FDA commissioner (2017-2019).

What do you think about this idea of paying over time for therapies that are even more expensive than chimeric antigen receptor T-cell therapy?
Well, in the Senate bill that was introduced there is a proposal to allow Medicaid plans in particular to try to amortize the cost of delivering curative gene therapy, particularly for things like inherited disorders. I think this is going to be important because these treatments—if you’re targeting even a multi-million-dollar gene therapy to a very rare, let’s say a pediatric inherited disease that’s extremely rare—that’s largely an insurable risk in the private market.

Any reasonably sized private pool of insurance pool, maybe every couple of years, is going to have 1 case that might require treatment like that. That kind of a pool is going to have a heart transplant every couple of years at a cost of 1.4 million dollars. So, that’s an insurable risk in a well-functioning market. I think where this becomes a particular burden is in the Medicaid market where a state might have 50 or 100 kids with a rare pediatric disorder at any 1 time, and if a product costs $1 million or $2 million—that’s a $100 million. That’s an amount of money that can throw off a state Medicaid budget.

So, the question becomes: how do states absorb the cost of these treatments in their Medicaid programs? I think what you worry about is a market where the private market is able to absorb these treatments. People get access to them, but the Medicaid market isn’t able to give access to these treatments, and then a product that quite literally can alter the destiny of a child if it’s delivered on time—you see differential access based on income and based on socioeconomic status. So, you see the very specter of technology exacerbating disparities in the population—I think that’s going to be intolerable.

So, we need to figure out a way to make sure that these treatments can be delivered not just in the private markets, but also in the publicly insured markets—and make sure that when these products come to market, Medicaid programs have access to them. So, patients who are suffering from a disease—where it’s literally a degenerative disease, and they’re accruing morbidity very quickly—have timely access to these treatments as well. We’ve seen situations where that hasn’t been the case and I think that needs to be solved for.
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