PSG Launches Solution to Assess Payers’ Gene Therapy Risk

Over the past two years, gene therapies have been approved by the FDA with list prices that are higher and higher: Roctavian for hemophilia A costs $2.9 million; Lyfgenia for sickle cell disease costs $3.1 million; Elevidys for Duchenne muscular dystrophy costs $3.2 million; Hemgenix for hemophilia B cost $3.5 million.

The most recent gene therapy was approved in March 2024, Lenmeldy to treat children with juvenile metachromatic leukodystrophy. Lenmeldy also has the distinction of having the highest ever price for a new treatment: $4.25 million.

One analysis by the Institute for Clinical and Economic Review (ICER) and NEWDIGS, Tufts Center for Biomedical System Design, suggests that 2032, there could be almost 50,000 patients a year that could be treated with gene therapies.

Related: No Silver Bullet for Paying for Gene Therapies

In 2023, spending on cell and gene therapies increased 38% over 2022 to $5.9 billion in 2023, according to a recent report from IQVIA Institute for Human Data Science. Interest in and research for gene and cell therapies is growing. Venture capital funding in this area reached $3.4 billion in 2023, and there were 406 industry-sponsored clinical trials started in 2023 along, finds the recent IQVIA report.

To help payers assess their risk for exposure to the costs of gene therapies, Pharmaceutical Strategies Group (PSG) has launched a new solution. Called Artemetrx GeneCQ, PSG’s solution uses algorithms to analyze clinical, demographic, diagnosis, and medication use data to identify the level of risk for individual members within specific populations.

Rebekah Gregg

“Clients were coming to us to provide our consulting perspective around the new sickle cell and hemophilia therapies,” Rebekah Gregg, chief operating officer of PSG, said in an interview. “Health plans were trying to get their arms around a risk transfer solution and how they were going to handle it financially. But the challenge was that everyone was really struggling to understand what their real financial exposure was for gene therapies.”

GeneCQ utilizes medical and pharmacy claims data from clients and analyzes that data against proprietary clinical and actuarial algorithms to provide detailed outputs of exposure by therapy and disease, with quantification of the financial risk.

The system creates a “risk score” that Gregg said aims to predict a financial cost estimate for the use of gene therapies for the plan or employer’s population. The algorithm use by GeneCQ integrates medical and pharmacy claims. She said this information can help self-insured companies and health plans determine financial solutions for gene therapy costs, whether through reinsurance, stop loss, or a risk-transfer option.

The solution is focused on non-oncology gene therapies, Gregg said.

“These therapies are so new that the market is truly not prepared with the right data to understand what the risk is,” Gregg said. “We don’t have any historical data in the sense of how these therapies will be adopted to be able to anticipate that risk.”

She pointed out that so far there has not been significant adoption of gene therapies, but there has been uptick in the market. “We have an opportunity to be reflective about these gene therapies before we see significant uptake,” Gregg said.