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.”
One day in recent past, scientists at Columbia University’s Creative Machines Lab set up a robotic arm inside a circle of five streaming video cameras and let the robot watch itself move, turn and twist. For about three hours the robot did exactly that—it looked at itself this way and that, like toddlers exploring themselves in a room full of mirrors. By the time the robot stopped, its internal neural network finished learning the relationship between the robot’s motor actions and the volume it occupied in its environment. In other words, the robot built a spatial self-awareness, just like humans do. “We trained its deep neural network to understand how it moved in space,” says Boyuan Chen, one of the scientists who worked on it.
For decades robots have been doing helpful tasks that are too hard, too dangerous, or physically impossible for humans to carry out themselves. Robots are ultimately superior to humans in complex calculations, following rules to a tee and repeating the same steps perfectly. But even the biggest successes for human-robot collaborations—those in manufacturing and automotive industries—still require separating the two for safety reasons. Hardwired for a limited set of tasks, industrial robots don't have the intelligence to know where their robo-parts are in space, how fast they’re moving and when they can endanger a human.
Over the past decade or so, humans have begun to expect more from robots. Engineers have been building smarter versions that can avoid obstacles, follow voice commands, respond to human speech and make simple decisions. Some of them proved invaluable in many natural and man-made disasters like earthquakes, forest fires, nuclear accidents and chemical spills. These disaster recovery robots helped clean up dangerous chemicals, looked for survivors in crumbled buildings, and ventured into radioactive areas to assess damage.
Now roboticists are going a step further, training their creations to do even better: understand their own image in space and interact with humans like humans do. Today, there are already robot-teachers like KeeKo, robot-pets like Moffin, robot-babysitters like iPal, and robotic companions for the elderly like Pepper.
But even these reasonably intelligent creations still have huge limitations, some scientists think. “There are niche applications for the current generations of robots,” says professor Anthony Zador at Cold Spring Harbor Laboratory—but they are not “generalists” who can do varied tasks all on their own, as they mostly lack the abilities to improvise, make decisions based on a multitude of facts or emotions, and adjust to rapidly changing circumstances. “We don’t have general purpose robots that can interact with the world. We’re ages away from that.”
Robotic spatial self-awareness – the achievement by the team at Columbia – is an important step toward creating more intelligent machines. Hod Lipson, professor of mechanical engineering who runs the Columbia lab, says that future robots will need this ability to assist humans better. Knowing how you look and where in space your parts are, decreases the need for human oversight. It also helps the robot to detect and compensate for damage and keep up with its own wear-and-tear. And it allows robots to realize when something is wrong with them or their parts. “We want our robots to learn and continue to grow their minds and bodies on their own,” Chen says. That’s what Zador wants too—and on a much grander level. “I want a robot who can drive my car, take my dog for a walk and have a conversation with me.”
Columbia scientists have trained a robot to become aware of its own "body," so it can map the right path to touch a ball without running into an obstacle, in this case a square.
Jane Nisselson and Yinuo Qin/ Columbia Engineering
Today’s technological advances are making some of these leaps of progress possible. One of them is the so-called Deep Learning—a method that trains artificial intelligence systems to learn and use information similar to how humans do it. Described as a machine learning method based on neural network architectures with multiple layers of processing units, Deep Learning has been used to successfully teach machines to recognize images, understand speech and even write text.
Trained by Google, one of these language machine learning geniuses, BERT, can finish sentences. Another one called GPT3, designed by San Francisco-based company OpenAI, can write little stories. Yet, both of them still make funny mistakes in their linguistic exercises that even a child wouldn’t. According to a paper published by Stanford’s Center for Research on Foundational Models, BERT seems to not understand the word “not.” When asked to fill in the word after “A robin is a __” it correctly answers “bird.” But try inserting the word “not” into that sentence (“A robin is not a __”) and BERT still completes it the same way. Similarly, in one of its stories, GPT3 wrote that if you mix a spoonful of grape juice into your cranberry juice and drink the concoction, you die. It seems that robots, and artificial intelligence systems in general, are still missing some rudimentary facts of life that humans and animals grasp naturally and effortlessly.
How does one give robots a genome? Zador has an idea. We can’t really equip machines with real biological nucleotide-based genes, but we can mimic the neuronal blueprint those genes create.
It's not exactly the robots’ fault. Compared to humans, and all other organisms that have been around for thousands or millions of years, robots are very new. They are missing out on eons of evolutionary data-building. Animals and humans are born with the ability to do certain things because they are pre-wired in them. Flies know how to fly, fish knows how to swim, cats know how to meow, and babies know how to cry. Yet, flies don’t really learn to fly, fish doesn’t learn to swim, cats don’t learn to meow, and babies don’t learn to cry—they are born able to execute such behaviors because they’re preprogrammed to do so. All that happens thanks to the millions of years of evolutions wired into their respective genomes, which give rise to the brain’s neural networks responsible for these behaviors. Robots are the newbies, missing out on that trove of information, Zador argues.
A neuroscience professor who studies how brain circuitry generates various behaviors, Zador has a different approach to developing the robotic mind. Until their creators figure out a way to imbue the bots with that information, robots will remain quite limited in their abilities. Each model will only be able to do certain things it was programmed to do, but it will never go above and beyond its original code. So Zador argues that we have to start giving robots a genome.
How does one do that? Zador has an idea. We can’t really equip machines with real biological nucleotide-based genes, but we can mimic the neuronal blueprint those genes create. Genomes lay out rules for brain development. Specifically, the genome encodes blueprints for wiring up our nervous system—the details of which neurons are connected, the strength of those connections and other specs that will later hold the information learned throughout life. “Our genomes serve as blueprints for building our nervous system and these blueprints give rise to a human brain, which contains about 100 billion neurons,” Zador says.
If you think what a genome is, he explains, it is essentially a very compact and compressed form of information storage. Conceptually, genomes are similar to CliffsNotes and other study guides. When students read these short summaries, they know about what happened in a book, without actually reading that book. And that’s how we should be designing the next generation of robots if we ever want them to act like humans, Zador says. “We should give them a set of behavioral CliffsNotes, which they can then unwrap into brain-like structures.” Robots that have such brain-like structures will acquire a set of basic rules to generate basic behaviors and use them to learn more complex ones.
Currently Zador is in the process of developing algorithms that function like simple rules that generate such behaviors. “My algorithms would write these CliffsNotes, outlining how to solve a particular problem,” he explains. “And then, the neural networks will use these CliffsNotes to figure out which ones are useful and use them in their behaviors.” That’s how all living beings operate. They use the pre-programmed info from their genetics to adapt to their changing environments and learn what’s necessary to survive and thrive in these settings.
For example, a robot’s neural network could draw from CliffsNotes with “genetic” instructions for how to be aware of its own body or learn to adjust its movements. And other, different sets of CliffsNotes may imbue it with the basics of physical safety or the fundamentals of speech.
At the moment, Zador is working on algorithms that are trying to mimic neuronal blueprints for very simple organisms—such as earthworms, which have only 302 neurons and about 7000 synapses compared to the millions we have. That’s how evolution worked, too—expanding the brains from simple creatures to more complex to the Homo Sapiens. But if it took millions of years to arrive at modern humans, how long would it take scientists to forge a robot with human intelligence? That’s a billion-dollar question. Yet, Zador is optimistic. “My hypotheses is that if you can build simple organisms that can interact with the world, then the higher level functions will not be nearly as challenging as they currently are.”
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.
Podcast: Wellness chatbots and meditation pods with Deepak Chopra
Over the last few decades, perhaps no one has impacted healthy lifestyles more than Deepak Chopra. While several of his theories and recommendations have been criticized by prominent members of the scientific community, he has helped bring meditation, yoga and other practices for well-being into the mainstream in ways that benefit the health of vast numbers of people every day. His work has led many to accept new ways of thinking about alternative medicine, the power of mind over body, and the malleability of the aging process.
His impact is such that it's been observed our culture no longer recognizes him as a human being but as a pervasive symbol of new-agey personal health and spiritual growth. Last week, I had a chance to confirm that Chopra is, in fact, a human being – and deserving of his icon status – when I talked with him for the Leaps.org podcast. He relayed ideas that were wise and ancient, yet highly relevant to our world today, with the fluidity and ease of someone discussing the weather. Showing no signs of slowing down at age 76, he described his prolific work, including the publication of two books in the past year and a range of technologies he’s developing, including a meditation app, meditation pods for the workplace, and a chatbot for mental health called Piwi.
Take a listen and get inspired to do some meditation and deep thinking on the future of health. As Chopra told me, “If you don’t have time to meditate once per day, you probably need to meditate twice per day.”
Highlights:
2:10: Chopra talks about meditation broadly and meditation pods, including the ones made by OpenSeed for meditation in the workplace.
6:10: The drawbacks of quick fixes like drugs for mental health.
10:30: The benefits of group meditation versus individual meditation.
14:35: What is a "metahuman" and how to become one.
19:40: The difference between the conditioned mind and the mind that's infinitely creative.
22:48: How Chopra's views of free will differ from the views of many neuroscientists.
28:04: Thinking Fast and Slow, and the role of intuition.
31:20: Athletic and creative geniuses.
32:43: The nature of fundamental truth.
34:00: Meditation for kids.
37:12: Never alone.Love and how AI chatbots can support mental health.
42:30: Extending lifespan, gene editing and lifestyle.
46:05: Chopra's mentor in living a long good life (and my mentor).
47:45: The power of yoga.
Links:
- OpenSeed meditation pods for people to meditate at work (Chopra is an advisor to OpenSeed).
- Chopra's book from 2021, Metahuman: Unleash Your Infinite Potential
- Chopra's book from 2022, Abundance: The Inner Path to Wealth
- NeverAlone.Love, Chopra's collaboration of businesses, policy makers, mental health professionals and others to raise awareness about mental health, advance scientific research and "create a global technology platform to democratize access to resources."
- The Piwi chatbot for mental health
- The Chopra Meditation & Well-Being App for people of all ages
- Only 1.6 percent of U.S. children meditate, according to the National Center for Complementary and Integrative Health