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Cost-Benefit Analysis Favorable but Challenging for Gene Therapy for SCD

April 9, 2024

May 2024

Ruth Jessen Hickman, MD

Ruth Jessen Hickman, MD, is a freelance medical and science writer based in Bloomington, Indiana.

Financial barriers remain high for the two recently approved gene therapies for sickle cell disease (SCD) and for others in development. A recent cost-benefit analysis published in Annals of Internal Medicine attempted to quantify some of the benefits of the therapy from both a medical and societal perspective.1

Although follow-up is needed to monitor for potential long-term risks, gene therapy for SCD offers the potential of a transformative one-time treatment with curative intent, potentially ameliorating and not just controlling symptoms, pain, and organ damage related to vaso-occlusive crises.

However, there are considerable price concerns around these gene therapies. One author of the recent analysis, Anirban Basu, PhD, a professor of health economics at the University of Washington School of Pharmacy in Seattle, pointed out that of the 16 or so gene therapies currently on the market, most cost more than $1 million, and some up to $3.5 million, not including costs from the prolonged hospitalizations required for the procedure.

Using two different models, Dr. Basu and colleagues analyzed a group of patients with SCD who would currently qualify for gene therapy. They estimated projected costs under standard-of-care (SOC) treatment using data from the Centers for Medicare & Medicaid Services (CMS), such as the cost of hospitalizations and ER visits. They contrasted this with estimated costs if patients received gene therapy (including an estimated drug price of $2 million). They also performed analyses that looked at wider societal impacts like lost productivity and caregiver costs.

The team looked at incremental cost-effectiveness ratios — the difference between the cost of the two treatment approaches divided by differences in benefits. They estimated that for gene therapy to produce one extra quality-adjusted life year (QALY), the cost would be $193,000. However, that estimate was $126,000 when other societal factors were considered. Dr. Basu said that with a reference equity threshold of $150,000 per QALY, gene therapy compared favorably from a societal perspective.

Another author of the analysis, Jane S. Hankins, MD, MS, a professor in the Department of Global Pediatric Medicine at St. Jude Children’s Research Hospital in Memphis, said that the process of getting approval for genetic therapies is quite onerous, and the therapy requires prolonged hospitalization, so it isn’t the right choice for every patient.

One limitation of the current study is that it did not factor in allogeneic hematopoietic cell transplantation (alloHCT) as a potential option in its analysis. AlloHCT is the treatment of choice for the minority of patients who have access to a fully matched donor and have an indication for a bone marrow transplant. Although much more expensive than SOC therapy, the costs of alloHCT do not approach that of gene therapy.2 However, alloHCT with HLA-mismatched donors have suboptimal outcomes, and it’s not yet clear how its benefits and risks will ultimately compare to gene therapy approaches for SCD.

Dr. Hankins noted that uptake is likely to be slow at first as the result of manufacturing constraints and limits on the number of hospitals certified to perform the necessary preparation, procedures, and follow-up.

In January, the Biden administration announced that SCD will be highlighted under the Cell and Gene Therapy Access Model, designed to improve access to cell and gene therapies for people with Medicaid while also reducing health care costs.3

However, Dr. Basu said that even under the proposed outcomes-based models, gene therapy is likely to remain extremely expensive for CMS. A rough calculation indicates that under current prices, CMS would expect to pay roughly $10 billion for 5,000 patients. Experts predict the cost to manufacture gene therapies should come down substantially, but this won’t necessarily translate into decreased prices.

“My personal view is that nothing is going to appreciably reduce the budget impact of this therapy if CMS doesn't actually negotiate down the price of the product like many private [insurance] plans do,” Dr. Basu said.

“For patients who have tried everything and do not have any other options and need gene therapy treatment, it’s a matter of justice. We just have to figure out how to do it,” said Dr. Hankins.

Any conflicts of interest declared by the authors can be found in the original article.

References

  1. Basu A, Winn AN, Johnson KM, et al. Gene therapy versus common care for eligible individuals with sickle cell disease in the United States: a cost-effectiveness analysisAnn Intern Med. 2024;177(2):155-164.
  2. Saraf SL, Ghimire K, Patel P, et al. Improved health care utilization and costs in transplanted versus non-transplanted adults with sickle cell disease. PLoS One. 2020;15(2):e0229710.
  3. U.S. Department of Health and Human Services. Biden-Harris administration announces action to increase access to sickle cell disease treatments. January 30, 2024. Accessed March 5, 2024. https://www.hhs.gov/about/news/2024/01/30/biden-harris-administration-announces-action-increase-access-sickle-cell-disease-treatments.html.

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