Biotechnology changes destiny.

There are more than 7,000 rare diseases in the world, affecting more than 300 million people, 80% of them are caused by single gene mutations. Currently, 95% of them still have no effective treatments.

The idea of gene therapy is to solve the disease from the source. By regulating the genetic information in the upstream DNA, the scientists "correct" the disease-causing genes, thereby changing the expression of downstream proteins. This makes it possible to cure diseases that were difficult to treat or even incurable in the past.

Cell-based gene therapy has been booming in the past few years. Only 1 gene therapy approved in 2012, and 2 gene editing therapies approved in December 2023, however, more than 40 types are expected to be developed in the next ten years.

However, the true value of these epoch-making therapies is open to question. Because the real problem cannot be avoided, gene therapy can cure diseases, but can we afford it?

Gene therapy continues to set new limits for high price drugs. From US$1 million to US$2 million to US$3.5 million per needle. No country in the world has a health system that can afford it, including the United States.

The emergence of more and more new treatment modalities marks that we are at the beginning of a new era, but we also need to pay attention to the various challenges and problems.

Fundamentally, these drugs are far beyond the reach of ordinary families, which requires the consideration of innovative payment solutions.

Right now, the United States is making many attempts. In one study, researchers used mathematical models to evaluate 109 gene therapies that were in late clinical stages. Simulation results show that from January 2020 to December 2034, 1.09 million American patients are expected to receive gene therapy, with spending peaking at $25.3 billion during the period, totaling $306 billion.

The heavy social burden paved the way for the payment reform of gene therapy.

The U.S. CMS (Centers for Medicare and Medicaid Services) announced on January 30 the exploration of a new payment method for cell and gene therapy. It plans to use a cell and gene therapy access model. There are early plans to incorporate two gene therapies used to treat sickle cell disease into the model to achieve price reductions.

Payment for patients with sickle cell disease must rely on payers, and it is difficult to gain a negotiating advantage on price by relying solely on states' own user volumes.

For this reason, CMS hopes to reduce prices through payment based on efficacy and federally insured volume-based purchasing.

According to CMS, this plan is to pay manufacturers through an outcomes-based agreement (OBA), and the payment amount is linked to the health outcomes of patients within a certain period of time, and CMS also hopes to be linked to drug sales. There are three cores:

Under this model, if a gene therapy is less successful than expected at improving long-term health outcomes, drug manufacturers would refund a portion of the cost of the treatment to healthcare payers. The agreement will also include other price concessions such as volume-based rebates or guaranteed rebates.

CMS will represent states in negotiations with manufacturers regarding cell and gene therapies for beneficiaries for whom Medicaid is the primary payer. This model allows CMS to bring states together to negotiate on a multi-state basis, rather than each state establishing its own OBA with manufacturers.

CMS will also be responsible for establishing financial and clinical outcome measures, harmonizing data and evaluating results. States will still be responsible for paying for cell and gene therapies, but price rebates will be determined based on the specific outcome of CMS negotiations.

These combination models not only reduce financial risk for patients and insurance providers, but also provide incentives for pharmaceutical companies and healthcare providers to continuously optimize and improve treatment options.

At the same time, CMS also stated that as the effects become apparent, this payment model will be adopted for more cell gene therapy drugs in the future.

The high price drug payment model explored by the most developed countries with innovative drugs may also have certain reference significance for other countries and regions.