The Centers for Medicare and Medicaid Services will enter talks with manufacturers to come up with a pricing and rebate scheme that will tie the gene therapies’ cost with their effectiveness.
Pictured: Entrance to the Department of Health and Human Services/iStock, hapabapa
The Centers for Medicare and Medicaid Services announced Tuesday that it will seek outcomes-based agreements with manufacturers of sickle cell disease gene therapies in a bid to lower healthcare expenses and expand patient access to these multimillion-dollar treatments.
Under the agency’s Cell and Gene Therapy Access Model, which it first unveiled in February 2023, CMS will negotiate with manufacturers to come up with a pricing and rebate structure that ties the costs of these therapies to their efficacy and whether they improve health outcomes for treated patients.
According to CMS, approximately 50% to 60% of people living with sickle cell disease (SCD) are enrolled in Medicaid. The agency said it will offer optional funding to states that “engage in activities that increase equitable access to cell and gene therapies and promote multi-disciplinary, comprehensive care for people with Medicaid with SCD receiving gene therapy.”
The negotiations with gene therapy manufacturers will involve a standardized access policy, according to Tuesday’s announcement. CMS said it will also negotiate the financial and clinical outcome measures with manufacturers.
States will then be able to decide whether they want to partner with the biopharma companies based on CMS’s negotiated terms. This access framework is set to start on January 2025 and states will have until January 2026 to indicate their participation.
CMS said it is also looking to address other care gaps during the negotiation process with manufacturers for the outcomes-based agreements. These include requiring companies to offer a “defined scope” of fertility services for patients receiving their gene therapies and incentivizing states that promote multi-disciplinary care for sickle cell disease patients, such as by expanding Medicaid benefits to include behavioral health services.
“Gene therapies for sickle cell disease have the potential to treat this devastating condition and transform people’s lives, offering them a chance to live healthier and potentially avoid associated health issues,” CMS Administrator Chiquita Brooks-LaSure said in a statement. “Increasing access to these promising therapies will not only help keep people healthy, but it can also lead to savings for states and taxpayers as the long-term costs of treating sickle cell disease may be avoided.”
Tuesday’s announcement follows the FDA’s back-to-back approvals in December 2023 of Vertex Pharmaceuticals and CRISPR Therapeutics’ Casgevy (exagamglogene autotemcel) and bluebird bio’s Lyfgenia (lovotibeglogene autotemcel). Both are one-time and potentially curative gene therapies that address the underlying genetic cause of sickle cell disease.
Casgevy has a list price of $2.2 million, which according to a recent study published in the journal Annals of Internal Medicine, would largely be considered as cost-effective.
However, Lyfgenia is nearly $1 million more expensive. Investors have been spooked by Lyfgenia’s $3.1 million price tag, causing the company’s stocks to drop in the days following the gene therapy’s approval. The biotech has since fought to regain some shareholder confidence, securing two major outcomes-based contracts with large commercial payers across the country.
Tristan Manalac is an independent science writer based in Metro Manila, Philippines. He can be reached at tristan@tristanmanalac.com or tristan.manalac@biospace.com.
