The payment scheme will tie gene therapy payments to improvements in health outcomes—and could potentially boost the uptake of these sickle cell disease treatments.
The Centers for Medicare and Medicaid Services on Wednesday announced that it has arrived at agreements with bluebird bio and Vertex Pharmaceuticals, securing their participation in a new voluntary payment model to improve access to gene therapies for sickle cell disease.
The outcomes-based arrangement aims to boost uptake of these gene therapies while also increasing their accessibility. Payments will be tied to improvements in health outcomes for Medicaid beneficiaries receiving the treatments. CMS did not specify what these outcomes are or how it plans to measure improvements.
Wednesday’s agreement will cover bluebird’s Lyfgenia and Vertex’s CRISPR Therapeutics-partnered Casgevy. These gene therapies were given back-to-back SCD approvals in December 2023, but uptake has been slow. A major reason is cost: Casgevy has a list price of $2.2 million, while Lyfgenia costs $3.1 million.
The companies have justified these price tags by emphasizing that both gene therapies are one-time infusions meant to cure SCD, potentially avoiding a lifetime’s worth of healthcare costs. Still, patients and payers have largely remained skeptical.
As of August 2024—more than six months after approval—neither Vertex nor bluebird had reported starting treatment with their respective SCD gene therapies. A month later, however, the companies announced that they had indeed started infusions. Experts had anticipated a slow start to these therapies, particularly given the time it takes to prepare a patient for infusions, but the delays mean that earnings from these assets will be pushed back.
The new CMS payment scheme could help bluebird and Vertex boost uptake, particularly as 50% to 60% of SCD patients are enrolled in Medicaid, according to Wednesday’s news release. Hospitalization costs associated with the disease can add up to $3 billion in annual costs for the U.S. healthcare system.
CMS will launch the new payment model in January 2025. Individual states may also choose to participate in the arrangement and need to signify their intent to do so between January 2025 and January 2026. Additionally, states can access up to $9.55 million in grant funding related to the new gene therapy payment model.
“We are pleased to build on this commitment by offering an outcomes-based agreement to state Medicaid agencies,” bluebird chief commercial and operating officer Tom Kilma said in a statement announcing the biotech’s participation in the new CMS payment model. “We are also pleased to be able to offer fertility preservation support to eligible patients eligible by Medicaid in states that opt into the Model.”
