Genetic engineering.
On November 22nd, the Food and Drug Administration (FDA) approved the world’s first gene therapy for hemophilia B; Hemgenix (etranacogene dezaparvovec). Hemgenix will have a list price of $3.5 million per use. This sets a new record for the most expensive single-use gene therapy in the U.S. In spite of the very high price tag, the budgetary impact of the product for most payers will be comparatively small.
The product was first developed by the Dutch biotechnology company uniQure. In 2020, CSL Behring paid $450 million to license the therapy. CSL Behring will be marketing the drug.
Hemophilia B is caused by missing or low levels of a protein called Factor IX, which is needed to clot blood. Depending on the amount of Factor IX present, people with hemophilia B can experience spontaneous or excessive bleeding that can lead to severe health complications. To prevent these complications from occurring, the current standard of care includes treatments consisting of replacement of Factor IX. These must be taken regularly.
Hemgenix’s sponsor, CSL Behring, is no stranger to the hemophilia B disease space, as it’s been a specialist in plasma and blood-related products for a long time. The company sells two approved Factor IX therapies for hemophilia B.
Hemgenix is designed to replace the gene which is responsible for Factor IX and is defective in people with hemophilia B. Results from the pivotal Phase 3 trial that led to Hemgenix’s approval showed that seven to 18 months after infusion, the average adjusted annualized bleeding rate was reduced by 54% compared to baseline. The trial included 54 patients with hemophilia B, 51 of whom (or 94%) were able to discontinue use of prophylaxis and remained free of those routine treatments 18 months of follow-up.
The cost-effectiveness watchdog, the Institute for Clinical and Economic Review (ICER), determined that it would be “fair” for Hemgenix to be priced at or near $2.9 million.
Additionally, ICER noted that a gene therapy such as Hemgenix becomes more cost effective the more durable it is. The company marketing the product, CSL Behring, contends that by reducing costs associated with bleeding and prophylactic infusions, the one-time treatment will save money over time. This is because the current costs of treating people with moderate to severe hemophilia B can be quite significant. For severe hemophilia B patients, for example, over the period of a lifetime the cost can be as much as $20 million per person.
However, at present, it’s not known how durable the treatment will be. It’s speculation whether the therapy will be “cost saving” as CSL Behring claims.
And, given the churn that exists – the rate at which enrollees leave insurers – many payers in the U.S. may not have a long-term view. That is, they may not be that interested in cost savings that occur for patients years down the road. At the same time, payers will take notice of the high upfront costs per patient.
However, the relatively small sub-population that can be treated with Hemgenix should keep costs in check for most payers. As a rare disease, hemophilia B afflicts approximately 6,000 people in the U.S. About 15% of patients require Factor IX therapy. And only a small portion of these people will be eligible for Hemgenix. In other words, the impact on most payers’ budgets – their financial exposure – will be relatively limited.
Estimates of global sales of Hemgenix project $1.2 billion cumulatively through 2026. So, despite its eye-popping price of $3.5 million, this is not a gene therapy that will necessarily break the bank. Moreover, it is likely that value-based pricing arrangements will be implemented which mitigate the impact of the high upfront costs per dose. For example, payers will likely negotiate “milestone-based reimbursement,” with installment payments based on (durable) outcomes achieved.
Looking to the future, certain other cell and gene therapies in the pipeline have considerably larger (potentially) eligible populations of patients, including the disease area ischemic stroke. In addition, currently approved cell and gene products in several cancers are now indicated for earlier lines of treatment, which implies substantial expansion of populations suitable for therapy. It’s these treatments that (will) hit payer radar screens.
