Tag Archives: gene therapy

What are the risks and potential solutions associated with gene and cell therapies?

Gene therapies, CAR T-cell therapies, and other innovative therapies are beginning to enter the market and are making waves with their record-setting prices. These therapies are curing, extending life, or providing increased quality of life to patients who—in many cases—had exhausted all other options. From the patient’s perspective, it is clear that the drug is worth it. But from the payer’s perspective, there are risks and benefits to be taken into consideration.

There are only a handful of gene and cell therapies approved for use in the United States today, and they are currently indicated for rare diseases. However, a large number of these therapies are currently in development worldwide. The aggregate effect of these therapies entering the market impacts both small and large insurers, and will increase the need for viable solutions to mitigate their risks and uncertainties.

Some gene and cell therapies differ from most traditional treatments in that they have limited administration periods, but have the potential for ongoing clinical benefits. There are four key uncertainties related to these therapies from the payer’s perspective: initial performance, durability and efficacy, cost offsets, and price. Understanding these risks will influence how a payer perceives the value of the therapy.

Because gene and cell therapies are a fairly new paradigm of treatment, there is considerable uncertainty around their efficacy and long-term durability. From the financial perspective, the drug itself is likely to have a substantial price tag, but there are additional financial risks.

In this paper, Milliman’s Anne Jackson and Jessica Naber discuss in more detail the sources of uncertainty regarding gene and cell therapies. They also discuss what will affect appropriate solutions for mitigating these risks.

The potential cost of gene therapy may surprise payers

An estimated 80% of rare diseases are genetic. For patients diagnosed with rare genetic diseases, gene therapies may offer an adequate treatment option. However, gene therapies may be costly for payers using the current payment models in the U.S. healthcare system. Milliman actuaries Anne Jackson and Jessica Naber discuss the issue in the article “The future is now: Are payers ready for gene therapies?