No cure, no fee? Outcome-based agreements for gene therapies

Gene therapies directly address the underlying cause of genetic disease. When they work, they can offer transformative benefits to patients by halting disease progression and – in some circumstances – offering the prospect of a cure.

Despite the potential for transformative value to patients, questions are being raised about whether adopting these technologies into routine clinical care threatens the financial sustainability of health systems in the long term due to their high price. As the list of gene therapy approvals grows, so too does the pressure on payers. Even in cases where the record-breaking price tags are matched by expected savings in future medical costs for a patient, the sizable upfront costs still create significant challenges for any reimbursement system.

Hemgenix (etranacogene dezaparvovec) is a promising new gene therapy for haemophilia B. Current treatments involve life-long regular intravenous infusions to prevent bleeding episodes. In contrast, Hemgenix could allow adults with moderately-severe and severe haemophilia B to produce their own blood clotting Factor IX for up to two years with a single dose.

The National Institute of Health and Care Excellence (NICE) is the body in the UK that conducts health technology assessment for new medical technologies, to decide if they should be provided on the NHS. NICE has recently published draft guidance recommending against the routine use of the new gene therapy on the NHS (see BioNews 1202). This recommendation is due to the high uncertainty surrounding its long-term clinical-effectiveness and consequent cost-effectiveness (ie, whether it offers value for money).

NICE has previously approved other gene therapies for conditions such as metachromatic leukodystrophy (HST18) (see BioNews 1132) and spinal muscular atrophy (HST15) (see BioNews 1087), both of which are degenerative genetic conditions that can be fatal in early childhood. Both showed potential for long-term effects and were appraised under NICE's Highly Specialised Technology pathway, which only considers drugs for very rare conditions with no other satisfactory treatment options and, therefore, has a higher threshold for what is considered acceptable use of NHS resources.

Another way of managing the reimbursement of one-off high-cost treatments with clinical uncertainty is by using 'outcome-based agreements', which explicitly tie payment for pharmaceutical products to the outcomes observed in the patients who receive them. With this approach, the manufacturer would agree to refund the payer if a patient does not meet some pre-agreed clinical outcome.

In our recent Office of Health Economics report, Health Technology Assessment of Gene Therapies: Are Our Methods Fit for Purpose?, we propose six recommendations to better capture the value of gene therapies and address uncertainty in outcomes. We advocate for the inclusion of outcome-based arrangements to mitigate uncertainty in long-term outcomes while enabling patient access.

Implementing these types of arrangements can benefit all involved: patients can access promising new gene therapies while clinical uncertainty is resolved, long-term efficacy is confirmed, and manufacturers and payers can share the financial risk.

While there are some challenges, we've seen these sorts of arrangements working in practice: Individual-level outcome-based arrangements have been implemented in Spain and Italy. In the cases of Kymriah (tisagenlecleucel) for the treatment of B-cell acute lymphoblastic leukaemia and Yescarta (axicabtagene ciloleucel) for the treatment of non-Hodgkin lymphoma, payments were made in instalments as long as the outcomes were achieved and sustained. In both countries, these agreements were supported by data from national web-based patient registries, allowing individual patient outcomes to be tracked. The staged payments also help to alleviate the financial burden of paying for these expensive treatments in one large upfront payment.

However, despite the potential benefits, outcome-based agreements are not as widely implemented as one might expect. It can be challenging to negotiate mutually agreeable terms, and appropriate data infrastructure is required to record individual patient-level responses to treatment. In countries that do not already have national registries, significant investment and commitment are required to set up and maintain patient registries. There are often also concerns around data privacy regulations.

Another barrier to the uptake of outcome-based agreements is the administrative burden associated with following up on patients' responses and endpoints. This task often falls to clinicians and back-office staff who may already have limited time to complete paperwork. Outcome-based agreements require more time and costs compared to standard payment models for tracking patients, invoicing, accounting, and other contractual obligations to ensure high-quality data is collected.

These challenges also herald opportunities: additional data collected with the primary purpose of informing outcome-based agreements can also be used to optimise care for individual patients as well as contribute to health system efficiency by determining optimal treatment regimes. Moreover, if data can be shared across jurisdictions, further safety and efficacy information for gene therapies can improve our knowledge of how well these drugs work and for whom.

Many more gene therapies will receive marketing approval in the near future, and there are even more in the pipeline, meaning that payers are likely to increasingly turn to innovative outcome-based agreements to create a sustainable way to ensure patient access. Manufacturers, bodies and payers will have to work in partnership to facilitate the use of outcome-based payments on a wider scale, particularly in the advent of gene therapies for more prevalent conditions such as haemophilia. Cross-country dialogue and the publication of details of outcome-based agreements would be valuable tools to improve the implementation of outcome-based agreements and support health system learnings.

Further research into how the challenges facing outcome-based agreements can be overcome for gene therapies, particularly those treating more prevalent conditions, could accelerate the uptake of such therapies and boost confidence in the financial sustainability for payers.