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BioMarin's Next Roctavian Challenge Is How To Successfully Commercialize Its Gene Therapy: Warranties May Be An Option
This photo provided by BioMarin in June 2023 shows a vial and packaging for their gene therapy, ... [+] Roctavian. On June 29th, the FDA approved Roctavian for hemophilia A. (BioMarin via AP)
BioMarinAfter quite the regulatory process, with Roctavian (valoctocogene roxaparvovec) BioMarin has a potential blockbuster. On June 29th, Roctavian became the first gene therapy approved in the U.S. In the hemophilia A space.
Listed at $2.9 million per single-use, Roctavian is also one of the most expensive therapies ever approved. Now the company turns to the difficult task of commercializing the product. Offering warranties may be a viable option.
The biopharmaceutical company BioMarin has been at the forefront of cutting edge innovation for a long time. It has carved out a niche in the rare diseases market, specifically with respect to multiple enzyme disorders affecting particularly small orphan populations. Now it has an approval in an indication—hemophilia A—with a considerably larger population, albeit still relatively rare.
Hemophilia A is an X-linked genetic disorder caused by a missing or defective clotting protein known as Factor VIII. Patients suffering from hemophilia A often experience spontaneous bleeds.
Roctavian is administered to a patient via a one-time infusion into the bloodstream that restores production of Factor VIII. Responding to treatment implies no longer needing to receive regularly recurring prophylaxis treatment with Factor VIII replacement.
Phase 3 trial findings demonstrated that Roctavian reduced the average annualized bleed rate by 80% from baseline, and Factor VIII usage by 94% in year three compared to baseline. In addition, 92% of the 134 persons who participated in the trial were off prophylaxis by the end of year three.
The cost-effectiveness watchdog, the Institute for Clinical and Economic Review (ICER), concluded that at a price of $2.5 million Roctavian could be cost-effective. In a draft evidence report, ICER calculated the lifetime cost per patient of managing hemophilia A using a one-time dose of Roctavian versus the monoclonal antibody Hemlibra (emicizumab), which was launched in 2018.
The $2.9 million price tag is higher than $2.5 million. Yet, given that many hemophilia A patients will have their therapies administered in 340B-eligible treatment centers, this implies 340B discounted prices of perhaps 30% or more.
But, despite the relatively favorable clinical- and cost-effectiveness data and lower net price, the still very high upfront per-patient costs can be a difficult hurdle for payers to overcome.
BioMarin has indicated that outcomes-based agreements will be in the offing, as they've already been in Europe where the product was approved last year. In Germany, BioMarin is now working directly with the National Association of Statutory Health Insurance Funds to finalize access. The company is also currently in pricing and reimbursement negotiations with the relevant authorities in France and Italy.
One of the key commercial obstacles for gene therapies is figuring out the appropriate reimbursement model for drugs that could be one-time treatments. Questions around the durability of novel gene therapies persist and remain a potential sticking point for negotiating reimbursement agreements with payers.
A Warranty Construct
While it may make sense to implement a mortgage-style payment system for gene therapies, spread out over time and with refunds in place if certain predetermined outcomes aren't met, payers in Europe and the U.S. Have thus far been reluctant to embrace this particular concept.
In lieu of this, BioMarin plans to offer a warranty in the U.S. To avoid having to negotiate outcomes-based agreements separately with each individual payer. With a warranty, BioMarin seeks to, in its words, "simplify the process" of an outcomes-based agreement by offering a guarantee that includes a refund to the payer if a patient treated with Roctavian has to revert to prophylaxis treatment within a four year period. The question is straightforward, according to BioMarin's CEO Jean-Jacques Bienaimé, "is the patient back on prophylaxis or not?"
Though BioMarin has not provided the precise terms of the Roctavian warranty, BioMarin CCO Ajer describes it like this: "You have a patient that takes Roctavian and starts bleeding at the end of year three and needs to go back on prophylaxis; they have consumed 75% of the value of a four-year agreement, so we would refund back 25% of the value of Roctavian."
The warranties provide a refund to healthcare payers, including Medicaid and Medicare insurers, should Roctavian fail to deliver the expected outcomes for a given patient.
Here, BioMarin would take out an insurance policy with a third party insurer: For example, it could do so with Marsh, a global leader in insurance brokerage and risk management, who is partnering with Octaviant Financial to develop warranties, specifically designed for cell and gene therapies.
Octaviant defines therapeutic warranties as "insurance-based instruments funded by manufacturers that provide recourse to the warranty holder if a product does not meet predefined expectations."
The warranty holder in this case is the payer or entity that makes the decision to reimburse a therapy. It is then entitled to a refund guaranteed by the manufacturer as stipulated in the warranty policy if certain predetermined outcomes aren't achieved.
The use of a warranty may allow companies to avoid triggering government "best price" reporting problems in Medicaid, which will likely be the predominant payer of hemophilia A products.
Medicaid's best price policy requires drug manufacturers to provide Medicaid programs the so-called best price. Best price is defined as the lowest available price to any wholesaler, retailer, or provider, excluding certain government programs, such as Veterans Affairs. Through a refund scheme offered to one payer the best price could theoretically drop to zero and then apply across all Medicaid programs.
BioMarin CCO Jeff Ajer noted, "we have this warranty construct that gets us out of the business of having to negotiate payer by payer [and] we think gets us out of the worst problems associated with government price reporting."
In this context, it's possible that BioMarin will rely on recently enacted Centers for Medicare and Medicaid Services (CMS) guidance to permit multiple best prices. To facilitate the broad adoption of value-based pricing contracts (of which warranties are a special case), CMS's rule enacted last July allows drug manufacturers to report a range of best prices to the extent that they may be determined by varying discounts under different kinds of value-based pricing (VBP) arrangements, along with the regular best price under any non-VBP arrangements.
Besides the warranties, there are more mundane issues for BioMarin to deal with, including temporary and permanent coding for reimbursement once Roctavian launches. In its earnings call earlier this year, a BioMarin spokesperson said that "we still have other critical elements of the U.S. Launch to work through," which includes "getting on formulary until we have a J code ... Through the medical exception process."
As the company gets its ducks in a row to facilitate commercialization of Roctavian, we will likely hear more about how warranties could help gene therapies prevail over existing payer reimbursement hurdles.
US Regulator Approves First Ever Gene Therapy For People With Hemophilia A
A life-changing treatment for people with hemophilia A, which was developed at UCL and licensed by UCLB to BioMarin Pharmaceuticals Inc., has been approved by the United States' Food and Drug Administration (FDA).
Roctavian (valoctocogene roxaparvovec) has become the first ever gene therapy for adults with severe hemophilia A to be approved by the FDA, meaning it can be sold as a treatment for patients with the disease. It follows a similar approval in August 2022 by the European Commission.
Hemophilia A is a rare genetic bleeding disorder, where a genetic mutation results in a deficiency of Factor VIII, a blood clotting protein normally produced by the body, which can mean bleeding is harder to control and is life-threatening in severe cases. Hemophilia A can seriously impact on quality of life because of the harm from bleeding, the need to manage the risk caused by physical activity, and the limitations of previous treatments.
Currently, hemophilia A requires ongoing treatment throughout patients' lives, with regular injections to replace the missing Factor VIII.
Roctavian is ground-breaking because it is a one-time, long-term treatment, using a gene therapy approach to treat the disease and enable people with hemophilia A to increase their levels of Factor VIII. The active Factor VIII gene is delivered by an engineered adeno-associated virus to deliver genetic material into cells. The gene is then expressed in the liver, which produces the Factor VIII protein, improving the ability of the body to control bleeding without regular injections.
The technology was developed by Professor Amit Nathwani (UCL Cancer Institute and Institute of Immunity & Transplantation) and his team at UCL and St. Jude Children's Research Hospital, U.S. It was licensed by UCLB, the commercialization company for UCL, to BioMarin Pharmaceuticals Inc. In 2013.
Professor Nathwani said, "It is humbling to be involved in the creation of the first gene therapy for patients with severe hemophilia A. Current treatment is effective but highly demanding requiring regular lifelong injections. Most severe hemophilia A patients suffer recurrent break-through bleeding into joints despite treatment that ultimately leads to disability and chronic pain. The approval of Roctavian, is an important and long-awaited advance that addresses the genetic cause of the condition. Roctavian is a one-time gene therapy that offers patients long term protection from bleeds and avoids the burden of regular infusions."
Biomarin's GENEr-8, the longest global Phase 3 study to date for any gene therapy in hemophilia, was key to achieving the approval of Roctavian by the FDA. It found that the therapy was effective in reducing the rate of bleeding in a cohort of 134 patients for at least three years.
Professor Geraint Rees, UCL Vice-Provost (Research, Innovation and Global Engagement) said, "Creating the first long-term treatment for severe hemophilia A will change lives, and proving its effectiveness and achieving FDA approval is a major achievement. It is a prime example of how our approach to industry-academic engagement is directly benefitting society."
UCL is a recognized leader in transformative gene therapies. The success of Roctavian follows a number of recent milestones for UCLB's gene therapy spinouts, including Freeline's first patient dosed with a novel gene therapy candidate for Gaucher Disease, and the use of spinout Orchard Therapeutic's Libmeldy by the NHS to treat children with metachromatic leukodystrophy, an otherwise fatal disorder.
Richard Fagan, Director of BioPharm at UCLB, said, "Our partnership with BioMarin has spanned over a decade. Since licensing the technology to BioMarin, the company has taken forward Roctavian's pioneering clinical development, and undertaken some of the most extensive clinical trials for a gene therapy in the world. The successful FDA approval is a significant achievement for UCL and UCLB and ultimately Hemophilia patients."
Provided by University College London
Citation: US regulator approves first ever gene therapy for people with hemophilia A (2023, July 3) retrieved 4 July 2023 from https://sciencex.Com/wire-news/449859581/us-regulator-approves-first-ever-gene-therapy-for-people-with-he.Html
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FDA Approves 1st Gene Therapy For Hemophilia A
The FDA approved the first gene therapy treatment for adults with severe hemophilia A.
Roctavian is an adeno-associated virus vector-based gene therapy that is administered as a single dose by intravenous infusion, according to a June 29 agency news release. It contains a viral vector carrying a gene for clotting, which is expressed in the liver to increase blood levels of factor VIII, a protein that enables blood clots, and reduces risk of uncontrolled bleeding.
In a trial of 112 patients with a three-year follow-up, the mean annual bleeding rate decreased from 5.4 bleeds per year to 2.6 bleeds.
Hemophilia A is a rare genetic bleeding disorder due to a mutation of the gene that produces factor VIII.
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