Vertex Pharmaceuticals is mulling several options for pricing its experimental gene editing therapy for sickle cell disease ahead of an expected regulatory decision later this year, executives told investors on a conference call Wednesday.
The company, which developed the treatment with CRISPR Therapeutics, is currently talking through payment and reimbursement with both government and commercial insurers, aiming to have coverage in place upon a U.S. approval.
These types of discussions are standard practice ahead of a Food and Drug Administration decision. But they are more complicated for Vertex and CRISPR’s therapy, which is called “exa-cel” and envisioned as a one-time, potentially curative treatment for severe sickle cell and beta thalassemia, another genetic blood disorder. Like other gene therapies that have been launched in the U.S., it is expected to be expensive, possibly around $2 million per treatment by one estimate.
“We are considering a range of different options,” Stuart Arbuckle, Vertex’s chief operating officer, said on Wednesday’s call. “If you ask one payer what they’re looking for, you get one answer. If you ask another payer, you get another answer.”
“Right now, we’re in listening mode and designing what the nature of our payment models will be,” he added. “But I think the key word is flexibility.”
Drugmakers have previously launched gene therapies with pricing schemes meant to defray the risk of paying a seven-digit price tag, only for treatment not to work. For example, Bluebird bio said it would reimburse up to 80% of the $2.8 million cost for its beta thalassemia treatment Zynteglo if treated patients didn’t improve as expected.
However, these “outcomes-based” models can be challenging to make work in practice, particularly within Medicaid, the federal insurance plan for people with limited income. The Centers for Medicare and Medicaid Services recently proposed a model to help state Medicaid agencies explore outcomes-based payment, but it’s not set to be in place until 2026.
“Without these kinds of models, we’re going to see access issues,” Michael Sherman, chief medical officer of Point32 Health, told BioPharma Dive in an interview earlier this year. “The Medicaid state agencies, like other parts of the financing system, were never designed with this sort of upfront shock.”
Approximately two-thirds of patients with sickle cell or beta thalassemia have government health insurance, with the majority covered by Medicaid, Vertex estimates.
The company has been in contact with the Medicaid administrators in all 50 states, Arbuckle said Wednesday. It’s focusing in particular on the 24 states with the highest sickle cell prevalence. He called CMS’ proposed model “clear evidence of the federal government's recognition of the potential transformative value of gene therapies like exa-cel to treat sickle cell disease.”
Vertex is also having discussions with commercial insurers, which Arbuckle described as “encouraging.”
Still, the company is setting expectations for a relatively slow launch. Treatment requires a monthslong process of extracting patient stem cells, editing them in a laboratory and then reinfusing them back into the body.
Before that final step happens, patients must also receive a “conditioning” chemotherapy regimen that’s meant to clear space in the bone marrow for the edited stem cells to take root. This can be toxic and may factor into many patients’ decision-making around whether to pursue gene therapy.
“This launch we do expect to be slightly slower in uptake rates than in cystic fibrosis,” said Arbuckle, referring to the company’s past experience with cystic fibrosis drugs. “We continue to believe there's a lot of interest. It's a big market opportunity and we see [the therapy] as a multibillion-dollar opportunity in the future.”
Analysts at RBC Capital Markets expect the conditioning regimen and other market challenges to limit adoption of Vertex and CRISPR’s therapy to a “narrow niche of very severe patients willing to undergo the procedure,” according to a recent investor note.
They currently estimate a “conservative” $900 million in out-year annual sales.
The FDA split its review of Vertex and CRISPR’s therapy, considering the drug’s use in sickle cell and beta thalassemia separately. The agency expects to decide on approval in the former indication by Dec. 8, and in the latter by March 30.
Before those dates, the FDA will convene a panel of independent advisers to discuss the therapy’s merits, Vertex confirmed Tuesday. No date has been set yet, however.