How cell and gene therapies are redefining the traditional ...€¦ · Case study: GLYBERA –...

© 2019 Parexel International Corporation

How cell and gene therapies are redefining the traditional pharmaceutical P&R model

Alex Gee

Principal Consultant

[email protected]

© 2019 Parexel International Corporation 2

Easy first question…

How much is a human life worth?

What price tag would you put on this?

© 2019 Parexel International Corporation3

Agenda for today

Situation overview

Innovative P&R solutions

Local access challenges


We are upon an era of medicines with transformational benefits such as CAR-T…

CAR-T cell therapies

Genetically engineered

T cells

Express a synthetic receptor

designed for a specific target

Expand and persist in vivo with high potency

Indication: r/r B cell ALL

ELIANA (Phase 2 trial)

83% CR/CRi at 3 months

79% 12-month OS

E.g. KYMRIAH ®


…gene therapies also offer potential cures for treatments with high unmet need…

Gene therapies

Gene inserted into

a virus

Replace faulty or missing genes in

patients’ cells

Curative potential for genetic diseases and long-term cost savings

Indication: ADA-SCID

SoC: ERT ~$500,000/yr or HSCT

AD1115611 (Phase 1/2 trial, n=12)

100% survival (median f/u 7 yrs)

E.g. STRIMVELIS®


…but these pose a myriad of challenges for reimbursement authorities…

Gene therapies

Transformative benefits

Expedited regulatory authorisation

Single treatment

Cost-effective at very high prices

Uncertainty in benefit magnitude and durability

Substantial upfront costs


…with NVS announcing their SMA gene therapy could be cost-effective at $4-5 million / patient in November 2018…

Drug

A gene therapy

Phase 1: All 15 pts alive after 24 monthsand did not require permanent ventilation

�� Rare progressive genetic disorder

Characterized by severe muscle weakness

Type 1 = most common and severe

68% affected newborns die before 2nd birthday

Clinical data for AVXS-101

Initial indication

Current Best SoC

only available disease-modifying treatment

Cost over 10 years: $4.1 million


…which they launched in May 2019 at $2.125 million per patient for a one-time treatment…

$2.125m

10 yr cost of current SMA treatment10 yr treatment costs of genetic paediatric ultra-rare diseasesICER’s ultra-rare ICER threshold

Novartis’s price justification

50% less than established

benchmarks

Novartis’s price innovations

Working with payers to offer

5-yr pay over time options

5-yr outcomes-based agreements


… but some transformative healthcare innovations have been commercial failures

Case study: GLYBERA� – first EC-approved gene therapy

PricingLaunch price (in DE) €1.1 million per patient

No innovative reimbursement scheme

Commercial success

May 2016 – one commercial sale reported

Nov 2017 - UniQure did not renew their marketing authorisation

€1.1 millionEC approval 25/10/2012

For hereditary LPLD per patient


…How do you appropriately price and reimburse gene and CAR-T cell therapies?

How can you appropriately price and reimburse gene & CAR-T therapies, that offer

No comparative data

No long term data

Single treatment

Durability of benefit?

Incremental benefits?

Substantial upfront investment

A

B

C

But, the evidence package supporting at launch may have

Potential long term, curative benefitsIn areas of severe unmet treatment needs

© 2019 Parexel International Corporation / CONFIDENTIAL11

Agenda for today

Situation overview

How payers may deal with potentially transformative/ curative therapies e.g. gene and CAR-T cell therapies




Question time…

What current or innovative solutions are there to mitigate the identified

risks?

No comparative data

No long term data

Single treatment

Durability of benefit?

Incremental benefits?

Substantial upfront investment

A

B

C


2 main subsections to this chapter


Existing reimbursement schemes

Innovative proposals for P&R


There are several CAR-T cell and gene therapy products with EU +/or US regulatory approval

Drug Therapy Indication

STRIMVELIS Gene ADA-SCID 26 May 2016 Not approved

KYMRIAH CAR-T cellALL & DLBCL

23 Aug 201830 Aug 20171 May 2018

YESCARTA CAR-T cell DLBCL 23 Aug 2018 18 Oct 2017

LUXTURNA GeneType of retinal

dystrophy22 Nov 2018 19 Dec 2017

ZYNTEGLO Gene Beta-thalassemia CMAFiling expected by end

of 2019


… In Europe, CAR-T cell therapies have had varied reimbursement outcomes to date...

Of note, Italy has also recently reimbursed Kymriah for both DLBCL and ALL.


… NICE have utilized the CDF, but the SMC have struggled to approve CAR-Ts…

NICE SMC

DLBCL (CDF, 1st Feb 2019)

ALL (Accepted, 11th Jan 2019)

DLBCL Accepted after initial

rejection 9th September 2019)

DLBCL/PMBCL (CDF, 7th Dec 2018)

Accepted after initial rejection 7th October

ALL (CDF; 21st Dec 2018)

Inequities in access

SMC took substantially longer to recommend

KYMRIAH or YESCARTA in DLBCL patients

NICE recommended KYMRIAH and YESCARTA

through the newly reformed CDF


…a time-limited resolution & performance-pricing was applied to KYMRIAH in DE…

KYMRIAH – 1st CAR-T assessed by G-BA (15 Mar 2019)

2 indications

Additional benefit

ALL (orphan) DLBCL (orphan)

Unquantifiable Unquantifiable

Benefit assessment only valid until 15 Mar 2020Data deemed “deficient” (due to short f/u)

Manufacturer must resubmit additional data

Time-limited assessment

Performance based pricing

• NVS will reimburse some of the costs if patient dies with a defined period after treatment

• Only until price negotiations completed


… and performance-based and indication specific pricing has been utilized in the US

Aug 2017: KYMRIAH launched in ALL with performance-based pricing

In ALL In DLBCL

May 2018: Kymriah launched in DLBCL where it is priced differently

$373,000$475,000

KYMRIAH: 1st FDA approved CAR-T (30/08/2017) in R/R BC-ALL

Payment only if patients respond in 1st monthInnovative P&R

announced at launch

CMS cancelled this planJul 2018

Feb 2019: CMS proposes Coverage with Evidence Development (CED)

Patient outcomes would be monitored for up to 2-years post treatmentEvidence would inform a future coverage decision by CMS


Vision exam…

How much is 20/20 vision worth and avoiding sight

loss and eventual blindness?

What price tag would you put on this?


Luxturna also leveraged a complex multi-part innovative pricing model

LUXTURNA – 1st FDA approved gene therapy

$850,000 FDA approval 19/12/2017In a rare inherited blindness

Innovative US pricing / contracting model

1

2

3

Outcomes-based rebate

Limit buy and bill risk

Payment in installations

Short term (30-90 days) and long-term (30 months) measurements. If efficacy not proven, rebate up to standard Medicaid rebate

IV medications are typically ‘buy and bill’ which can leave treatment centres with high financial exposure. Contract directly with speciality pharmacy providers

Proposal with CMS to spread payments over many years. Currently not feasible due to government reporting price requirements

per patient (both eyes)

4Cap patient OOP

costsTo address patient affordability issues, agreements to cap patient OOP costs have

been made with e.g. Express Scripts and other payers


Leveraging RWE offers major opportunities for both types of Innovative PR but it can be challenging to use this for C&GTs…

Technology not

reimbursed

Payers want local RWE to

inform reimburse-

ment

Local RWE can only be generated

once product is on market


EAPs can help leverage local RWE for P&R at launch, which has been done in the UK

ISPOR EU Nov 2018

However, there are some key challenges with using EAPS for evidence generation activities, such as

Data restrictions

Patient population

Time limits

NICE dupilumab (Aug 2018)


2 main subsections to this chapter


Existing reimbursement schemes

Innovative proposals for P&R


Gene therapy manufacturers proposing more innovative reimbursement agreements…

LentiGlobin (ZYNTEGLO) – a curative gene therapy

$1.8 millionEC-approval: 3 June 2019

For beta-thalassemia

Pricing plan: Performance-based reimbursement in instalments

20%

20%

20%

20%

20%

At treatment initiation

End of each year 1-4If efficacy maintained and blood transfusions are not needed

80% of the cost of treatment is potentially at risk


… with similar innovations also being proposed by payers…

The Massachusetts Initiative

A group of insurers in Massachusetts exploring innovative reimbursement with companies with innovative compounds

Proposal: performance-linked instalment plan

First drug considered Zolgensma

Each plan negotiates over price

Payment structure

Performance structurestandardized

Implementation issues also discussed including patients switching plans and legislative issues (e.g. Medicaid best price)

12-24 pts per year


…licensing delinks traditional volume and revenue models, with particular traction for antibiotics…

Jan ‘19: NICE, and NHS England have now announced a value-based license model for the

reimbursement of antibiotics to be implemented within 6 months

“Under such a model, the acute care institutions that are most likely to prescribe these medicines would

pay a fixed licensing fee for access to the drug, which would

offer them the right to use a certain number of annual doses”

USA UK


… but in HCV, Louisiana are implementing a ‘subscription-based ‘Netflix-model’…

March 2019 - Louisiana – HCV drugs

Gilead was selected to partner with the state to pay a fixed annual cost for unrestricted access to a branded generic version of EPCLUSA to treat Medicaid recipients and prisoners

April 2019 - Washington announced that AbbVie had won a similar “winner takes all” 5-year deal for HCV therapies to take effect in July 2019*


…with the UK NHS also proposing a licensing-based model for Vertex’s CF drugs

Vertex – Drugs by subscription?

Following stalled pricing negotiations over access to Vertex’s cystic

fibrosis drug Orkambi, NHS England proposed an unpreceded pricing

arrangement…

NHS England offered Vertex £500 million over 5 years, and £1 Billion over

10 years for unlimited access to all of Vertex’s CF drugs (including

Orkambi, Symkevi, and Kalydeco)

However, this arrangement was rejected by Vertex for “failing to adequately

reflect the value of our current and future medicines and the number of

patients that will be treated with these medicines“

Despite the lack of agreement, this highlights that payers are willing to consider, and even propose, innovative pricing arrangements


In summary, a range of innovative reimbursement schemes are being explored across markets…

Financial risk sharing Dynamic pricing

Performance-based

Leasing

Financial risk management tools include free stock, fixed per patient pricing, price-

volume agreements, budget caps, and dose caps

Reimbursing a medicinal product at a temporary price that can change upon

the generation and appraisal of subsequent data

Tying reimbursement to how well the drug works in real-life clinical practice in terms

of individual patient outcomes

Replacing up-front payment for medicines with a stream of staggered payments

linked to performance

Indication-specific

Enabling differential pricing per vial/packdepending on which specific indication it

is intended to be used in

Licensing

Drug developers would be paid based on how valuable the medicines are, not the

quantity of drugs sold


… but each has a distinct range of benefits and drawbacks reflecting their complexity

Financial risk sharing

Dynamic pricing

Performance-based

Leasing

More complex schemes may be potentially fairer in managing

risk/payment

but this may be outweighed by their associated complexities

and costs

Notable failures:UK MS Risk Sharing Scheme

2002

Indication specific


Agenda for today

Situation overview

How payers may deal with potentially transformative/ curative therapies e.g. gene and CAR-T cell therapies




What else matters…?

Besides financial risk, what other risks to commercial success are involved

with cell and gene therapy?


Cell and gene therapies may be associated with other specific access issues

Manufacturing Speed and distribution

Personalized nature Staffing and expertise

Provider-burden Upscaling


It takes 17 days to manufacture a CAR-T cell, during which patients can deteriorate…

If a patient has deteriorated during these 17 days to a point which they can no

longer be treated…

Who pays?


…post-treatment, patients are hospitalized for up to 14 days – but coding may be insufficient…

14 days

This ancillary treatment could increase the overall cost of care to as much as

$1 millionPayment codes do not address how this care will

be covered and by whom

Patients receiving CAR T-cell therapy use multiple care providers and sites of care

In the US, current coding inappropriately bundles the manufacturing process with provider-side care


… and these types of therapies may require a large financial outlay by providers…

Buy

Bill

&IV-administered therapies under

the medical benefit are administered / reimbursed under

buy and bill

The high costs associated with CAR-Ts mean that high upfront financial burdens must be incurred by providers and reimbursement sought later, with inherent risks

© 2019 Parexel International Corporation / CONFIDENTIAL37

… under this model, patient cost sharing may be prohibitive to access

Under such circumstances, a family whose child is treated with Novartis’s Zolgensma

($2m) could be required to pay:

$520,000

How much of the cost of care will be borne by patients?

However, 19% of commercial plans have no limits on cost-sharing, requiring patients to

pay an average of 26% of their drugs cost…

Such a cost burden would be unattainable and crippling for many families

In the US, most health-insurance plans have upper ceilings on co-insurance or co-

payment costs paid by patients, which limit patient liability for therapies


Centralization of CAR-T manufacturing and distribution internationally poses challenges…

Donor screeningTraceabilityLabelling

ConfidentialityApheresis requirements

Manufacturing T-cells in one country and then distributing them worldwide

is challenging, as regulations vary between countries in terms of


Recent news – the market is waking up to how commercialization is key to a gene therapy’s success


Initial and recent cell and gene therapies are taking initial steps to identify and address the issues

STRIMVELIS� – second EC-approved gene therapy

Regulatory approval

EC-approved in May 2016 (GSK)

For ADA-SCID (incidence ~15 per year in EU)

SoC: ERT ~$500,000/yr or HSCT

Innovative P&R

Commercial success?

July 2017 – two commercial sales reported1

April 2018 – GSK transfers rare disease gene therapy portfolio to

Orchard therapeutics2

Launch price (in Italy)

€594,000 per patient

Staggered payments via

annual installments

Patient & carer costs

travel/accommodation

Full ‘money back guarantee’


Summary and conclusions

Risk

management

Identifyand

define

Highly effective therapies

Limited data, short duration

One single treatment

Manage and

innovate

Conditional, outcomes based

Instalment to spread budget impact

Payer and provider willingness to

innovate

Beyond financial

risk

Regulatory, Price, Logistics?

Increase in C&G therapies impact

more widely?

How cell and gene therapies are redefining the traditional ...€¦ · Case study: GLYBERA –...

Documents

Transcript of How cell and gene therapies are redefining the traditional ...€¦ · Case study: GLYBERA –...