Price, value, challenge and opportunity
The view from Phacilitate Leaders World Summit 2020
The Phacilitate Leaders World Summit 2020 in Miami offered both an education in, and a celebration of, recent advances in cell and gene therapies, with a common thread running throughout: patient access.
Joan Finnigan, a lifelong patient advocate for cell and gene therapies, was born with cystic fibrosis in 1960. In the opening super plenary session, she spoke movingly about the fact that children born with cystic fibrosis today are already able to avoid many of the problems she experienced growing up, and she conveyed the real sense of hope among the patient community that things were set to be even better for future generations of patients.
Philippe Menasche, Professor of Thoracic and Cardiovascular Surgery at the University of Paris highlighted the importance of process simplicity in gene therapy manufacture, as he suggested that “to make a therapy accessible for a large number of patients at a reasonable price, simplicity of process is key. Otherwise, you have nice trials, and nice papers, but no product at the end of it.”
Challenges and opportunities in gene therapy manufacture
This idea was echoed throughout the event, as all the speakers agreed that efficient and scalable manufacture represents a real challenge to the industry, and a win-win opportunity for companies like OXGENE who are working to address it.
Jason Krentz, CTO of Tmunity said: “When it comes to manufacturing, companies must consider quality, cost, scale and opportunity, and the ones who do best focus on all of these. But even that’s not enough. They need to bring efficiency forward too, because scale only takes you so far.”
We heard repeatedly about the need to automate processes and to seek out partners who can deliver both scale and efficiency. All the speakers seemed to also agree on the need to collaborate on manufacturing process optimisation as early as possible in the clinical development timeline, preferably in the pre-competitive space. This, they said, is the way to ensure a robust, streamlined and carefully optimised process all the way through to commercial manufacture.
This is the exactly the area in which OXGENE excels, as we work with our customers to provide high quality plasmids and cell lines engineered to produce maximum viral yield, and bespoke services based on our automated production platforms and carefully optimised processes to further improve viral yield and purity, and support efficient scale up to GMP manufacture.
Big acquisitions, big deals, big pharma and big price tags
The cell and gene therapy field is extremely fast paced and innovative, and this has attracted significant investment over the last few years. There are now 987 companies focussed on cell or gene therapies globally, more than 1,000 active clinical trials, and numerous products with regulatory approval. The last twelve months has been notable for the number of big acquisitions, big licensing deals, big pharma involvement, and notably big price tags on approved products (Novartis’ Zolgensma was approved with a record-breaking price tag of $2 million plus).
So amidst the triumph and celebration, the challenges are clear, with patient access foremost among these. The key variables underlying this challenge are cost of development and market pricing.
But opinions vary on how to address and balance these variables. In the value-based pricing view, the question isn’t about product price, but product value. If a gene or cell therapy offers long term reprieve, or even a cure, from a single dose, the value is significantly higher than that of a conventional treatment, and the price reflects that value.
According to this model, cost of goods doesn't determine the eventual price of the therapy; it is more relevant to the associated profit, than the price.
But on the other side of the coin, reducing the price is clearly going to be an important factor in improving patient access. And in that case, reducing manufacturing costs could create space for a lower price tag on the eventual treatment, without hurting profit margins. Similarly, lowering the cost of goods and manufacturing would increase competition, which would in turn drive down prices and improve patient access.
The debate between value and cost-based pricing models isn’t new, and is unlikely to have a clear cut resolution. However, it was heartening to hear that everyone in the industry recognises the importance of protecting patient access to these often life saving treatments, and to hear that companies in this space are pioneering innovative pricing models to strike the necessary balance.
Finally, I’ll close with a phrase that’s stuck with me throughout the conference. Greg Gara, VP Pharmaceutical Engineering at Sarepta Therapeutics, talked about the importance of distinguishing between business relationships and true partnerships. He said: “partnerships are how things get done.”
If you’re interested in learning more about OXGENE’s technologies, or discussing partnering opportunities with us, please email firstname.lastname@example.org.