On the surface, it may seem that the higher the price of a new medicine, the harder it is for its developer to get a thumbs-up from drug-price watchdog Institute for Clinical and Economic Review (ICER). For companies in the rapidly growing gene and cell therapy field, that would make ICER’s review a tough hurdle to overcome, particularly if the agency’s opinions take on more weight in determining insurance coverage decisions in the future.
But analysts at Mizuho Securities dug into most of ICER’s verdicts on gene and cell therapies to date and found a surprising trend: The institute’s reviewers have deemed more than half the products they reviewed so far to be cost-effective. And the evidence they used to reach those positive conclusions offers important lessons on research, development and pricing to developers of the next generation of gene and cell therapies, said analyst Difei Yang, Ph.D., the lead author of two reports Mizuho sent to clients last week, in an interview.
“Clearly, they’re looking at the amount of time the patient gains but also the quality of life,” Yang said. Companies that put in the effort to provide robust data proving a gene or cell therapy could outperform the standard of care on both measures—head-to-head trials, solid evidence of long-term benefit and so forth—had a higher likelihood of a positive ICER verdict on cost-effectiveness, Mizuho found.
Makers of CAR-T cancer cell therapies have so far been much more successful at proving superiority over the standard of care than have manufacturers of gene therapies for rare diseases, Mizuho noted. ICER approved of the cost-effectiveness of the first two CAR-Ts on the market, Gilead’s Yescarta for lymphoma and Novartis’ Kymriah for lymphoma and leukemia, both approved in 2017 and launched at $373,000 and $475,000, respectively. And the agency has already said it will give the thumbs-up to the yet-to-be-approved multiple myeloma CAR-T cilta-cel from Janssen and Legend Biotech—provided that it is priced at $475,000 or less.
Only one of four CAR-Ts that ICER reviewed did not hit the cost-effectiveness threshold: Bristol Myers Squibb’s ide-cel for multiple myeloma, which was launched this spring with the brand name Abecma at a price of $419,500. A spokesperson for BMS griped at the time that ICER relied on “inappropriate modeling of ide-cel’s overall survival data and a misguided view of retreatment.”
ICER’s president Steve Pearson, M.D., cited “important evidence gaps” in the data available to the agency while it was reviewing the cost-effectiveness of multiple myeloma treatments.
Pearson said in an interview that ICER’s reviewers sometimes struggle to determine how data from what are often brief studies will translate to real-world outcomes. “We need to see longer-term data that we can connect to what we’re seeing in the short term,” Pearson said. “What we really want to see are patient-relevant outcomes, like how well they’re functioning and their quality of life.”
Often, companies fall short when it comes to providing data that provide a clear contrast between patients who receive gene or cell therapies and those who do not, Pearson said. “They may say [non-treated] patients would only have six months to live, but sometimes the comparison is just not that clean,” he said. “[Or] the [standard-of-care] data may be 10 years old. We know that care changes over 10 years.”
BMS took a step in that direction with another CAR-T in its portfolio, Breyanzi, which was approved in February for large B-cell lymphoma. Last week, it released trial data showing an improvement in event-free survival in patients who received the CAR-T treatment versus those who were treated with the gold standard, Roche’s Rituxan, high-dose chemotherapy and stem cell transplant.
It is too early to define Breyanzi’s ability to extend lives, but BMS hopes the data will ultimately move the CAR-T earlier in the treatment regimen and set the product apart from lymphoma rivals Yescarta and Kymriah. Breyanzi was introduced at a list price of $410,300. ICER has not yet reviewed the product.
Mizuho’s Yang says being able to get the green light for earlier treatment may be the motivation for such head-to-head trials, and, ultimately, these data would likely bring ICER on board with high-priced cell and gene therapies, too. “The earlier you treat the patient, the better off they are. And the better off they are, the lower the net cost will be to the healthcare system,” she says.
Gene therapies, on the other hand, have received mixed reviews from ICER on cost-effectiveness. Take Spark Therapeutics’ Luxturna, which is approved for a rare inherited disease that causes blindness for those aged one year and older. ICER found that the product, which launched at $850,000, would be cost-effective if given to patients at the age of three but not if patients were dosed at age 15 or later, because by that time they would have already lost a significant amount of eyesight.
Yang attributed the verdict to the cost of care. “ICER tries to quantify how much a caregiver costs, so if the child is treated earlier, the idea would be that they’re more independent, they require less care,” Yang says. “If they’re treated at 15, a lot of that cost has already happened. And this message is consistent with gene therapy in general.”
But Pearson said ICER’s reviewers placed more weight on the overall value to society of preventing blindness. “There really are no significant healthcare costs for being blind,” he said. “But society saves money to a certain extent, because educational costs are lower, patients have full careers and higher earnings potential if they’re fully sighted.”
ICER initially balked at Novartis' $2.1 million gene therapy for spinal muscular atrophy (SMA), Zolgensma, but it didn't approve of Biogen's SMA drug Spinraza either. Spinraza launched at up to $750,000 for the first year and half that every year thereafter, prompting ICER to ultimately determine Zolgensma is the lesser of two evils on cost.
BioMarin’s Roctavian, a hemophilia gene therapy, has hit some bumps on the road to approval, but ICER has already determined how it would be cost-effective. Using a placeholder price of $2.5 million, ICER estimated if the gene therapy is durable for a dozen years, it would save the healthcare system about $5 million per patient compared to chronically dosed factor VIII. “That’s an example of where gene therapy can really bring down [costs],” Yang said.
After delving into ICER’s methodology, Yang said she came away with one bone to pick with the agency. “Right now, their judgments are based on clinical valuation, but there should be some sort of consideration for the value of innovation,” she said. “We learn something along the way, and there has to be long-lasting value in that. I don’t think that’s being captured.”
Pearson’s response? “We are sensitive to the idea that there’s value in having treatments that take different approaches, but we don’t consider innovation as something that’s separate from the benefits to patients and families,” he said. “Innovation matters to patients to the degree it helps them live better lives. If it’s not better for patients, I’m not sure we should be paying more for it.”
ICER has recently boosted its efforts to maintain an ongoing dialogue with biopharma developers and insurance companies. The agency adopted a “formal 12-month checkup” policy for each of its published reports, Pearson said. If any new data have been released during that time, reviewers may revisit their original verdict.
It also introduced ICER Analytics, a cloud-based portal that houses all of its economic models. Life sciences companies and insurers can subscribe to ICER Analytics. “If [a drugmaker] has new evidence, or if they disagreed with our assumptions the first time around, they can put in their own information and create a different result on fair price,” Pearson said. “We’ll put that side by side with our original results so payers can see it.” More than 50 companies have signed up for trial subscriptions since ICER Analytics launched in November, he said.