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.”
By mid-March, Alpha Lee was growing restless. A pioneer of AI-driven drug discovery, Lee leads a team of researchers at the University of Cambridge, but his lab had been closed amidst the government-initiated lockdowns spreading inexorably across Europe.
If the Moonshot proves successful, they hope it could serve as a future benchmark for finding new medicines for chronic diseases.
Having spoken to his collaborators across the globe – many of whom were seeing their own experiments and research projects postponed indefinitely due to the pandemic – he noticed a similar sense of frustration and helplessness in the face of COVID-19.
While there was talk of finding a novel treatment for the virus, Lee was well aware the process was likely to be long and laborious. Traditional methods of drug discovery risked suffering the same fate as the efforts to find a cure for SARS in the early 2000, which took years and were ultimately abandoned long before a drug ever reached the market.
To avoid such an outcome, Lee was convinced that global collaboration was required. Together with a collection of scientists in the UK, US and Israel, he launched the 'COVID Moonshot' – a project which encouraged chemists worldwide to share their ideas for potential drug designs. If the Moonshot proves successful, they hope it could serve as a future benchmark for finding new medicines for chronic diseases.
Solving a Complex Jigsaw
In February, ShanghaiTech University published the first detailed snapshots of the SARS-CoV-2 coronavirus's proteins using a technique called X-ray crystallography. In particular, they revealed a high-resolution profile of the virus's main protease – the part of its structure that enables it to replicate inside a host – and the main drug target. The images were tantalizing.
"We could see all the tiny pieces sitting in the structure like pieces of a jigsaw," said Lee. "All we needed was for someone to come up with the best idea of joining these pieces together with a drug. Then you'd be left with a strong molecule which sits in the protease, and stops it from working, killing the virus in the process."
Normally, ideas for how best to design such a drug would be kept as carefully guarded secrets within individual labs and companies due to their potential value. But as a result, the steady process of trial and error to reach an optimum design can take years to come to fruition.
However, given the scale of the global emergency, Lee felt that the scientific community would be open to collective brainstorming on a mass scale. "Big Pharma usually wouldn't necessarily do this, but time is of the essence here," he said. "It was a case of, 'Let's just rethink every drug discovery stage to see -- ok, how can we go as fast as we can?'"
On March 13, he launched the COVID moonshot, calling for chemists around the globe to come up with the most creative ideas they could think of, on their laptops at home. No design was too weird or wacky to be considered, and crucially nothing would be patented. The entire project would be done on a not-for-profit basis, meaning that any drug that makes it to market will have been created simply for the good of humanity.
It caught fire: Within just two weeks, more than 2,300 potential drug designs had been submitted. By the middle of July, over 10,000 had been received from scientists around the globe.
The Road Toward Clinical Trials
With so many designs to choose from, the team has been attempting to whittle them down to a shortlist of the most promising. Computational drug discovery experts at Diamond and the Weizmann Institute of Science in Rehovot, Israel, have enabled the Moonshot team to develop algorithms for predicting how quick and easy each design would be to make, and to predict how well each proposed drug might bind to the virus in real life.
The latter is an approach known as computational covalent docking and has previously been used in cancer research. "This was becoming more popular even before COVID-19, with several covalent drugs approved by the FDA in recent years," said Nir London, professor of organic chemistry at the Weizmann Institute, and one of the Moonshot team members. "However, all of these were for oncology. A covalent drug against SARS-CoV-2 will certainly highlight covalent drug-discovery as a viable option."
Through this approach, the team have selected 850 compounds to date, which they have manufactured and tested in various preclinical trials already. Fifty of these compounds - which appear to be especially promising when it comes to killing the virus in a test tube – are now being optimized further.
Lee is hoping that at least one of these potential drugs will be shown to be effective in curing animals of COVID-19 within the next six months, a step that would allow the Moonshot team to reach out to potential pharmaceutical partners to test their compounds in humans.
Future Implications
If the project does succeed, some believe it could open the door to scientific crowdsourcing as a future means of generating novel medicine ideas for other diseases. Frank von Delft, professor of protein science and structural biology at the University of Oxford's Nuffield Department of Medicine, described it as a new form of 'citizen science.'
"There's a vast resource of expertise and imagination that is simply dying to be tapped into," he said.
Others are slightly more skeptical, pointing out that the uniqueness of the current crisis has meant that many scientists were willing to contribute ideas without expecting any future compensation in return. This meant that it was easy to circumvent the traditional hurdles that prevent large-scale global collaborations from happening – namely how to decide who will profit from the final product and who will hold the intellectual property (IP) rights.
"I think it is too early to judge if this is a viable model for future drug discovery," says London. "I am not sure that without the existential threat we would have seen so many contributions, and so many people and institutions willing to waive compensation and future royalties. Many scientists found themselves at home, frustrated that they don't have a way to contribute to the fight against COVID-19, and this project gave them an opportunity. Plus many can get behind the fact that this project has no associated IP and no one will get rich off of this effort. This breaks down a lot of the typical barriers and red-tape for wider collaboration."
"If a drug would sprout from one of these crowdsourced ideas, it would serve as a very powerful argument to consider this mode of drug discovery further in the future."
However the Moonshot team believes that if they can succeed, it will at the very least send a strong statement to policy makers and the scientific community that greater efforts should be made to make such large-scale collaborations more feasible.
"All across the scientific world, we've seen unprecedented adoption of open-science, collaboration and collegiality during this crisis, perhaps recognizing that only a coordinated global effort could address this global challenge," says London. "If a drug would sprout from one of these crowdsourced ideas, it would serve as a very powerful argument to consider this mode of drug discovery further in the future."
[An earlier version of this article was published on June 8th, 2020 as part of a standalone magazine called GOOD10: The Pandemic Issue. Produced as a partnership among LeapsMag, The Aspen Institute, and GOOD, the magazine is available for free online.]
World’s First “Augmented Reality” Contact Lens Aims to Revolutionize Much More Than Medicine
Imagine a world without screens. Instead of endlessly staring at your computer or craning your neck down to scroll through social media feeds and emails, information simply appears in front of your eyes when you need it and disappears when you don't.
"The vision is super clear...I was reading the poem with my eyes closed."
No more rude interruptions during dinner, no more bumping into people on the street while trying to follow GPS directions — just the information you want, when you need it, projected directly onto your visual field.
While this screenless future sounds like science fiction, it may soon be a reality thanks to the new Silicon Valley startup Mojo Vision, creator of the world's first smart contact lens. With a 14,000 pixel-per-inch display with eye-tracking, image stabilization, and a custom wireless radio, the Mojo smart lens bills itself the "smallest and densest dynamic display ever made." Unlike current augmented reality wearables such as Google Glass or ThirdEye, which project images onto a glass screen, the Mojo smart lens can project images directly onto the retina.
A current prototype displayed at the Consumer Electronics Show earlier this year in Las Vegas includes a tiny screen positioned right above the most sensitive area of the pupil. "[The Mojo lens] is a contact lens that essentially has wireless power and data transmission for a small micro LED projector that is placed over the center of the eye," explains David Hobbs, Director of Product Management at Mojo Vision. "[It] displays critical heads-up information when you need it and fades into the background when you're ready to continue on with your day."
Eventually, Mojo Visions' technology could replace our beloved smart devices but the first generation of the Mojo smart lens will be used to help the 2.2 billion people globally who suffer from vision impairment.
"If you think of the eye as a camera [for the visually impaired], the sensors are not working properly," explains Dr. Ashley Tuan, Vice President of Medical Devices at Mojo Vision and fellow of the American Academy of Optometry. "For this population, our lens can process the image so the contrast can be enhanced, we can make the image larger, magnify it so that low-vision people can see it or we can make it smaller so they can check their environment." In January of this year, the FDA granted Breakthrough Device Designation to Mojo, allowing them to have early and frequent discussions with the FDA about technical, safety and efficacy topics before clinical trials can be done and certification granted.
For now, Dr. Tuan is one of the few people who has actually worn the Mojo lens. "I put the contact lens on my eye. It was very comfortable like any contact lenses I've worn before," she describes. "The vision is super clear and then when I put on the accessories, suddenly I see Yoda in front of me and I see my vital signs. And then I have my colleague that prepared a beautiful poem that I loved when I was young [and] I was reading the poem with my eyes closed."
At the moment, there are several electronic glasses on the market like Acesight and Nueyes Pro that provide similar solutions for those suffering from visual impairment, but they are large, cumbersome, and highly visible. Mojo lens would be a discreet, more comfortable alternative that offers users more freedom of movement and independence.
"In the case of augmented-reality contact lenses, there could be an opportunity to improve the lives of people with low vision," says Dr. Thomas Steinemann, spokesperson for the American Academy of Ophthalmology and professor of ophthalmology at MetroHealth Medical Center in Cleveland. "There are existing tools for people currently living with low vision—such as digital apps, magnifiers, etc.— but something wearable could provide more flexibility and significantly more aid in day-to-day tasks."
As one of the first examples of "invisible computing," the potential applications of Mojo lens in the medical field are endless.
According to Dr. Tuan, the visually impaired often suffer from depression due to their lack of mobility and 70 percent of them are underemployed. "We hope that they can use this device to gain their mobility so they can get that social aspect back in their lives and then, eventually, employment," she explains. "That is our first and most important goal."
But helping those with low visual capabilities is only Mojo lens' first possible medical application; augmented reality is already being used in medicine and is poised to revolutionize the field in the coming decades. For example, Accuvein, a device that uses lasers to provide real-time images of veins, is widely used by nurses and doctors to help with the insertion of needles for IVs and blood tests.
According to the National Center for Biotechnology Information, augmentation of reality has been used in surgery for many years with surgeons using devices such as Google Glass to overlay critical information about their patients into their visual field. Using software like the Holographic Navigation Platform by Scopsis, surgeons can see a mixed-reality overlay that can "show you complicated tumor boundaries, assist with implant placements and guide you along anatomical pathways," its developers say.
However, according to Dr. Tuan, augmented reality headsets have drawbacks in the surgical setting. "The advantage of [Mojo lens] is you don't need to worry about sweating or that the headset or glasses will slide down to your nose," she explains "Also, our lens is designed so that it will understand your intent, so when you don't want the image overlay it will disappear, it will not block your visual field, and when you need it, it will come back at the right time."
As one of the first examples of "invisible computing," the potential applications of Mojo lens in the medical field are endless. Possibilities include live translation of sign language for deaf people; helping those with autism to read emotions; and improving doctors' bedside manner by allowing them to fully engage with patients without relying on a computer.
"[By] monitoring those blood vessels we can [track] chronic disease progression: high blood pressure, diabetes, and Alzheimer's."
Furthermore, the lens could be used to monitor health issues. "We have image sensors in the lens right now that point to the world but we can have a camera pointing inside of your eye to your retina," says Dr. Tuan, "[By] monitoring those blood vessels we can [track] chronic disease progression: high blood pressure, diabetes, and Alzheimer's."
For the moment, the future medical applications of the Mojo lens are still theoretical, but the team is confident they can eventually become a reality after going through the proper regulatory review. The company is still in the process of design, prototype and testing of the lens, so they don't know exactly when it will be available for use, but they anticipate shipping the first available products in the next couple of years. Once it does go to market, it will be available by prescription only for those with visual impairments, but the team's goal is to bring it to broader consumer markets pending regulatory clearance.
"We see that right now there's a unique opportunity here for Mojo lens and invisible computing to help to shape what the next decade of technology development looks like," explains David Hobbs. "We can use [the Mojo lens] to better serve us as opposed to us serving technology better."