Breakthrough therapies are breaking patients' banks. Key changes could improve access, experts say.
CSL Behring’s new gene therapy for hemophilia, Hemgenix, costs $3.5 million for one treatment, but helps the body create substances that allow blood to clot. It appears to be a cure, eliminating the need for other treatments for many years at least.
Likewise, Novartis’s Kymriah mobilizes the body’s immune system to fight B-cell lymphoma, but at a cost $475,000. For patients who respond, it seems to offer years of life without the cancer progressing.
These single-treatment therapies are at the forefront of a new, bold era of medicine. Unfortunately, they also come with new, bold prices that leave insurers and patients wondering whether they can afford treatment and, if they can, whether the high costs are worthwhile.
“Most pharmaceutical leaders are there to improve and save people’s lives,” says Jeremy Levin, chairman and CEO of Ovid Therapeutics, and immediate past chairman of the Biotechnology Innovation Organization. If the therapeutics they develop are too expensive for payers to authorize, patients aren’t helped.
“The right to receive care and the right of pharmaceuticals developers to profit should never be at odds,” Levin stresses. And yet, sometimes they are.
Leigh Turner, executive director of the bioethics program, University of California, Irvine, notes this same tension between drug developers that are “seeking to maximize profits by charging as much as the market will bear for cell and gene therapy products and other medical interventions, and payers trying to control costs while also attempting to provide access to medical products with promising safety and efficacy profiles.”
Why Payers Balk
Health insurers can become skittish around extremely high prices, yet these therapies often accompany significant overall savings. For perspective, the estimated annual treatment cost for hemophilia exceeds $300,000. With Hemgenix, payers would break even after about 12 years.
But, in 12 years, will the patient still have that insurer? Therein lies the rub. U.S. payers, are used to a “pay-as-you-go” model, in which the lifetime costs of therapies typically are shared by multiple payers over many years, as patients change jobs. Single treatment therapeutics eliminate that cost-sharing ability.
"As long as formularies are based on profits to middlemen…Americans’ healthcare costs will continue to skyrocket,” says Patricia Goldsmith, the CEO of CancerCare.
“There is a phenomenally complex, bureaucratic reimbursement system that has grown, layer upon layer, during several decades,” Levin says. As medicine has innovated, payment systems haven’t kept up.
Therefore, biopharma companies begin working with insurance companies and their pharmacy benefit managers (PBMs), which act on an insurer’s behalf to decide which drugs to cover and by how much, early in the drug approval process. Their goal is to make sophisticated new drugs available while still earning a return on their investment.
New Payment Models
Pay-for-performance is one increasingly popular strategy, Turner says. “These models typically link payments to evidence generation and clinically significant outcomes.”
A biotech company called bluebird bio, for example, offers value-based pricing for Zynteglo, a $2.8 million possible cure for the rare blood disorder known as beta thalassaemia. It generally eliminates patients’ need for blood transfusions. The company is so sure it works that it will refund 80 percent of the cost of the therapy if patients need blood transfusions related to that condition within five years of being treated with Zynteglo.
In his February 2023 State of the Union speech, President Biden proposed three pilot programs to reduce drug costs. One of them, the Cell and Gene Therapy Access Model calls on the federal Centers for Medicare & Medicaid Services to establish outcomes-based agreements with manufacturers for certain cell and gene therapies.
A mortgage-style payment system is another, albeit rare, approach. Amortized payments spread the cost of treatments over decades, and let people change employers without losing their healthcare benefits.
Only about 14 percent of all drugs that enter clinical trials are approved by the FDA. Pharma companies, therefore, have an exigent need to earn a profit.
The new payment models that are being discussed aren’t solutions to high prices, says Bill Kramer, senior advisor for health policy at Purchaser Business Group on Health (PBGH), a nonprofit that seeks to lower health care costs. He points out that innovative pricing models, although well-intended, may distract from the real problem of high prices. They are attempts to “soften the blow. The best thing would be to charge a reasonable price to begin with,” he says.
Instead, he proposes making better use of research on cost and clinical effectiveness. The Institute for Clinical and Economic Review (ICER) conducts such research in the U.S., determining whether the benefits of specific drugs justify their proposed prices. ICER is an independent non-profit research institute. Its reports typically assess the degrees of improvement new therapies offer and suggest prices that would reflect that. “Publicizing that data is very important,” Kramer says. “Their results aren’t used to the extent they could and should be.” Pharmaceutical companies tend to price their therapies higher than ICER’s recommendations.
Drug Development Costs Soar
Drug developers have long pointed to the onerous costs of drug development as a reason for high prices.
A 2020 study found the average cost to bring a drug to market exceeded $1.1 billion, while other studies have estimated overall costs as high as $2.6 billion. The development timeframe is about 10 years. That’s because modern therapeutics target precise mechanisms to create better outcomes, but also have high failure rates. Only about 14 percent of all drugs that enter clinical trials are approved by the FDA. Pharma companies, therefore, have an exigent need to earn a profit.
Skewed Incentives Increase Costs
Pricing isn’t solely at the discretion of pharma companies, though. “What patients end up paying has much more to do with their PBMs than the actual price of the drug,” Patricia Goldsmith, CEO, CancerCare, says. Transparency is vital.
PBMs control patients’ access to therapies at three levels, through price negotiations, pricing tiers and pharmacy management.
When negotiating with drug manufacturers, Goldsmith says, “PBMs exchange a preferred spot on a formulary (the insurer’s or healthcare provider’s list of acceptable drugs) for cash-base rebates.” Unfortunately, 25 percent of the time, those rebates are not passed to insurers, according to the PBGH report.
Then, PBMs use pricing tiers to steer patients and physicians to certain drugs. For example, Kramer says, “Sometimes PBMs put a high-cost brand name drug in a preferred tier and a lower-cost competitor in a less preferred, higher-cost tier.” As the PBGH report elaborates, “(PBMs) are incentivized to include the highest-priced drugs…since both manufacturing rebates, as well as the administrative fees they charge…are calculated as a percentage of the drug’s price.
Finally, by steering patients to certain pharmacies, PBMs coordinate patients’ access to treatments, control patients’ out-of-pocket costs and receive management fees from the pharmacies.
Therefore, Goldsmith says, “As long as formularies are based on profits to middlemen…Americans’ healthcare costs will continue to skyrocket.”
Transparency into drug pricing will help curb costs, as will new payment strategies. What will make the most impact, however, may well be the development of a new reimbursement system designed to handle dramatic, breakthrough drugs. As Kramer says, “We need a better system to identify drugs that offer dramatic improvements in clinical care.”
Announcing "The Future of Science in America: The Election Issue"
As reviewed in The Washington Post, "Tomorrow's challenges in science and politics: Magazine offers in-depth takes on these U.S. issues":
"Is it time for a new way to help make adults more science-literate? What should the next president know about science? Could science help strengthen American democracy? "The Future of Science in America: The Election Issue" has answers. The free, online magazine is packed with interesting takes on how science can serve the common good. And just in time. This year has challenged leaders, researchers and the public with thorny scientific questions, from the coronavirus pandemic to widespread misinformation on scientific issues. The magazine is a collaboration of the Aspen Institute, a think tank that brings together a variety of public figures and private individuals to tackle thorny social issues, the digital science magazine Leapsmag and GOOD, a social impact company. It's packed with 15 in-depth articles about science with a view toward our campaign year."
The Future of Science in America: The Election Issue offers wide-ranging perspectives on challenges and opportunities for science as we elect our next national and local leaders. The fast-striking COVID-19 pandemic and the more slowly moving pandemic of climate change have brought into sharp focus how reliant we will be on science and public policy to work together to rescue us from crisis. Doing so will require cooperation between both political parties, as well as significant public trust in science as a beacon to light the path forward.
In spite of its unfortunate emergence as a flash point between two warring parties, we believe that science is the driving force for universal progress. No endeavor is more noble than the quest to rigorously understand our world and apply that knowledge to further human flourishing. This magazine aspires to promote roadmaps for science as a tool for health, a vehicle for progress, and a unifier of our nation.
This special issue is a collaboration among LeapsMag, the Aspen Institute Science & Society Program, and GOOD, with support from the Gordon and Betty Moore Foundation and the Rita Allen Foundation.
It is available as a free, beautifully designed digital magazine for both desktop and mobile.
TABLE OF CONTENTS:
- SCIENTISTS:
Award-Winning Scientists Offer Advice to the Next President of the United States - PUBLIC OPINION:
National Survey Reveals Americans' Most Important Scientific Priorities - GOVERNMENT:
The Nation's Science and Health Agencies Face a Credibility Crisis: Can Their Reputations Be Restored? - TELEVISION:
To Make Science Engaging, We Need a Sesame Street for Adults - IMMIGRATION:
Immigrant Scientists—and America's Edge—Face a Moment of Truth This Election - RACIAL JUSTICE:
Democratize the White Coat by Honoring Black, Indigenous, and People of Color in Science - EDUCATION:
I'm a Black, Genderqueer Medical Student: Here's My Hard-Won Wisdom for Students and Educational Institutions - TECHNOLOGY:
"Deep Fake" Video Technology Is Advancing Faster Than Our Policies Can Keep Up - VOTERS:
Mind the (Vote) Gap: Can We Get More STEM Students to the Polls? - EXPERTS:
Who Qualifies as an "Expert" and How Can We Decide Who Is Trustworthy? - SOCIAL MEDIA:
Why Your Brain Falls for Misinformation—And How to Avoid It - YOUTH:
Youth Climate Activists Expand Their Focus and Collaborate to Get Out the Vote - SUPREME COURT:
Abortions Before Fetal Viability Are Legal: Might Science and a Change on the Supreme Court Undermine That? - NAVAJO NATION:
An Environmental Scientist and an Educator Highlight Navajo Efforts to Balance Tradition with Scientific Priorities - CIVIC SCIENCE:
Want to Strengthen American Democracy? The Science of Collaboration Can Help
Kira Peikoff was the editor-in-chief of Leaps.org from 2017 to 2021. As a journalist, her work has appeared in The New York Times, Newsweek, Nautilus, Popular Mechanics, The New York Academy of Sciences, and other outlets. She is also the author of four suspense novels that explore controversial issues arising from scientific innovation: Living Proof, No Time to Die, Die Again Tomorrow, and Mother Knows Best. Peikoff holds a B.A. in Journalism from New York University and an M.S. in Bioethics from Columbia University. She lives in New Jersey with her husband and two young sons. Follow her on Twitter @KiraPeikoff.
Scientists Envision a Universal Coronavirus Vaccine
With several companies progressing through Phase III clinical trials, the much-awaited coronavirus vaccines may finally become reality within a few months.
But some scientists question whether these vaccines will produce a strong and long-lasting immunity, especially if they aren't efficient at mobilizing T-cells, the body's defense soldiers.
"When I look at those vaccines there are pitfalls in every one of them," says Deborah Fuller, professor of microbiology at the Washington University School of Medicine. "Some may induce only transient antibodies, some may not be very good at inducing T-cell responses, and others may not immunize the elderly very well."
Generally, vaccines work by introducing an antigen into the body—either a dead or attenuated pathogen that can't replicate, or parts of the pathogen or its proteins, which the body will recognize as foreign. The pathogens or its parts are usually discovered by cells that chew up the intruders and present them to the immune system fighters, B- and T-cells—like a trespasser's mug shot to the police. In response, B-cells make antibodies to neutralize the virus, and a specialized "crew" called memory B-cells will remember the antigen. Meanwhile, an army of various T-cells attacks the pathogens as well as the cells these pathogens already infected. Special helper T-cells help stimulate B-cells to secrete antibodies and activate cytotoxic T-cells that release chemicals called inflammatory cytokines that kill pathogens and cells they infected.
"Each of these components of the immune system are important and orchestrated to talk to each other," says professor Larry Corey, who studies vaccines and infectious disease at Fred Hutch, a non-profit scientific research organization. "They optimize the assault of the human immune system on the complexity of the viral, bacterial, fungal and parasitic infections that live on our planet, to which we get exposed."
Despite their variety, coronaviruses share certain common proteins and other structural elements, Fuller explains, which the immune system can be trained to identify.
The current frontrunner vaccines aim to train our body to generate a sufficient amount of antibodies to neutralize the virus by shutting off its spike proteins before it enters our cells and begins to replicate. But a truly robust vaccine should also engender a strong response from T-cells, Fuller believes.
"Everyone focuses on the antibodies which block the virus, but it's not always 100 percent effective," she explains. "For example, if there are not enough titers or the antibody starts to wane, and the virus does get into the cells, the cells will become infected. At that point, the body needs to mount a robust T-cytotoxic response. The T-cells should find and recognize cells infected with the virus and eliminate these cells, and the virus with them."
Some of the frontrunner vaccine makers including Moderna, AstraZeneca and CanSino reported that they observed T-cell responses in their trials. Another company, BioNTech, based in Germany, also reported that their vaccine produced T-cell responses.
Fuller and her team are working on their own version of a coronavirus vaccine. In their recent study, the team managed to trigger a strong antibody and T-cell response in mice and primates. Moreover, the aging animals also produced a robust response, which would be important for the human elderly population.
But Fuller's team wants to engage T-cells further. She wants to try training T-cells to recognize not only SARV-CoV-2, but a range of different coronaviruses. Wild hosts, such as bats, carry many different types of coronaviruses, which may spill over onto humans, just like SARS, MERS and SARV-CoV-2 have. There are also four coronaviruses already endemic to humans. Cryptically named 229E, NL63, OC43, and HKU1, they were identified in the 1960s. And while they cause common colds and aren't considered particularly dangerous, the next coronavirus that jumps species may prove deadlier than the previous ones.
Despite their variety, coronaviruses share certain common proteins and other structural elements, Fuller explains, which the immune system can be trained to identify. "T-cells can recognize these shared sequences across multiple different types of coronaviruses," she explains, "so we have this vision for a universal coronavirus vaccine."
Paul Offit at Children's Hospitals in Philadelphia, who specializes in infectious diseases and vaccines, thinks it's a far shot at the moment. "I don't see that as something that is likely to happen, certainly not very soon," he says, adding that a universal flu vaccine has been tried for decades but is not available yet. We still don't know how the current frontrunner vaccines will perform. And until we know how efficient they are, wearing masks and keeping social distance are still important, he notes.
Corey says that while the universal coronavirus vaccine is not impossible, it is certainly not an easy feat. "It is a reasonably scientific hypothesis," he says, but one big challenge is that there are still many unknown coronaviruses so anticipating their structural elements is difficult. The structure of new viruses, particularly the recombinant ones that leap from wild hosts and carry bits and pieces of animal and human genetic material, can be hard to predict. "So whether you can make a vaccine that has universal T-cells to every coronavirus is also difficult to predict," Corey says. But, he adds, "I'm not being negative. I'm just saying that it's a formidable task."
Fuller is certainly up to the task and thinks it's worth the effort. "T-cells can cross-recognize different viruses within the same family," she says, so increasing their abilities to home in on a broader range of coronaviruses would help prevent future pandemics. "If that works, you're just going to take one [vaccine] and you'll have lifetime immunity," she says. "Not just against this coronavirus, but any future pandemic by a coronavirus."
Lina Zeldovich has written about science, medicine and technology for Popular Science, Smithsonian, National Geographic, Scientific American, Reader’s Digest, the New York Times and other major national and international publications. A Columbia J-School alumna, she has won several awards for her stories, including the ASJA Crisis Coverage Award for Covid reporting, and has been a contributing editor at Nautilus Magazine. In 2021, Zeldovich released her first book, The Other Dark Matter, published by the University of Chicago Press, about the science and business of turning waste into wealth and health. You can find her on http://linazeldovich.com/ and @linazeldovich.