Avalere Analyst Weighs In on How Value Assessments Will Influence Gene and Cell Therapy Pricing

Megan Olsen, MPH, principal at Avalere, discusses the role that value assessments are expected to play in the future pricing of gene and cell therapies.

Megan Olsen, MPH, principal at Avalere, discusses how the impact of small patient populations and other limitations may influence payer conversations about gene and cell therapies.


What role will value assessments play in payer decisions on pricing for cell and gene therapies?

It's going to play an important role. And I think it already is today, to some extent. We've done some survey research with payers at Avalere and found that most payers are already doing their own valuations for products in this space. We've also seen other entities like [the Institute for Clinical and Economic Review] be referenced as a key stakeholder at informing valuation of various products in this space. When you have an introduction of a high cost potentially million dollar therapy, with the potential for the benefit over many years, it's going to get a lot of attention you'll want to understand what is the true value of the product relative to price. So, there are a lot of different frameworks under consideration for how to measure that and how to adapt various methodologies or framework specific to the cell and gene therapies, given the uniqueness of the asset.

There's a lot of evolving in the value-based space in the private market, but also in the policy sphere as well. We're seeing the new Biden administration emerge with its priorities in health care and I think value-based care is going to be at the top and we've heard references in the drug pricing arena on interest in tying prices to value in some way or leveraging or standing up a value assessment entity to really measure value and potentially have a role in informing price as well. So, I think a lot more to come there. And this whole swirling interest in innovative financing models is based on value and wanting to determine net pricing based on the value that the product is delivering to the patient, to the health care system, to the payer, etc. So, needing that data to to make those determinations but also using the data that is derived from these arrangements to inform future value conversations as well.