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U.S. more challenging payer environment for curative therapies, says BioMarin

by Thomas Meek
LONDON, 22 Feb (APM) - The U.S. will be a more challenging payer environment than Europe for BioMarin’s potentially curative gene therapy for haemophilia A, the company’s chief commercial officer has said.
Jeffrey Robert Ajer said in call with investors on Thursday that healthcare systems are not accustomed to dealing with the commercialisation of gene therapies such as valoctocogene roxaparvovec, which he described as involving a “change in paradigm from chronic treatment to one-time curative therapy” for the bleeding disorder.
This is a problem shared by other companies working in the area of advanced therapies, which tend to have a one-off cost for a lasting effect rather than the more standard process of numerous payments over a period of time for treatment.
The issue has become prominent in the past couple of years as the first of these types of treatment have hit the market, led by CAR-T cancer therapies Kymriah (tisagenlecleucel) from Novartis and Yescarta (axicabtagene ciloleucel) from Gilead. Both companies have proposed payment models based on the outcomes the treatment delivers, acknowledging that it will not work for some patients (APMHE 60797).
And this week the chief executive of Spark Therapeutics, which markets Luxturna (voretigene neparvovec) for a rare genetic vision loss, called for the U.S. government to introduce new Medicare measures which would allow cost-spreading for one-time gene and cell therapies over a number of years (APMHE 61966).
BioMarin is expecting similar issues for valoctocogene roxaparvovec, known as valrox, which delivers in a single administration the missing gene in haemophilia A patients that allows them to produce clotting factor VIII.
This would overhaul the treatment approach for most haemophilia A patients, where the most severe cases currently take a prophylactic regimen of intravenous infusions three times per week.
BioMarin is on track to complete enrolment in the Phase III study for valrox in the third quarter of this year, with the possibility of a filing for accelerated approved in the U.S. before the end of 2019.
Ajer said in the investor call that BioMarin’s commercial experience in the U.S. through its existing portfolio of drugs for rare diseases puts the company in a “uniquely good position” to deal with any payment challenges once it hits the market.
“We've been meeting with payers participating in cross-stakeholder groups addressing this issue for 1.5 years at least. So we have been pretty active on that front."
This includes both European and U.S. payers, he said, adding that the latter may prove to be a “more challenging environment for a couple of reasons”.
The first of these is the fragmentation of payers and the different types of payers, including commercial insurers and the national Medicaid and Medicare programmes, whereas in Europe countries tend to have a single national payer.
The second challenge is government pricing rules, which mean that if companies want to enter more “creative” pricing agreements with commercial payers they will encounter “really bad discount levels” for government programmes.
This is a problem that has previously been mentioned by Spark’s chief financial officer Stephen Webster, who said that Medicare and Medicaid are compelled to discount to the lowest price of a product, which could be $0 if a company wants to use performance-based pricing that means the drug is free if it does not work (APMHE 55656).
Ajer said he was hopeful the situation could be resolved, however: “We're not alone in addressing that. I think there's stakeholders inside of the government and the other payers that are trying to address this. We've got a little time to work this out and solve for it.”
He added that BioMarin has an advantage over companies such as Spark, as valrox would not be the company’s first approval.
“It's certainly possible in the U.S. if that's was our first approval that we could be starting on kind of a traditional one-time payment while models for other types of payment structures were being worked out and facilitated," he said the call, which is available as a transcript on Seeking Alpha.
BioMarin’s chief executive Jean-Jacques Bienaimé said the company may end up with different payment structures in different parts of the world or even in different regions of the U.S.
“Some might be more interested in paying over time and some over time based on performance. We're very open to those needs and we need to satisfy the different needs on the different segments of the market.”
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