With a breakthrough Food and Drug Administration (FDA) approval for Novartis’ gene therapy Kymriah, the Centers for Medicare and Medicaid Services (CMS) announced plans to consider outcome-based pricing for this and other novel drugs. Kymriah, a genetically modified autologous T-cell immunotherapy, will cost $475,000 for a course of treatment. The drug is for patients up to 25 years old with B-cell precursor acute lymphoblastic leukemia. In a study, the drug induced remission in 83% of patients.
Coinciding with the FDA approval, CMS announced a new kind of collaboration with Novartis that will pay for the drug based on how well it works for individual patients. For at least some pediatric patients, Novartis will only be paid when the patient responds to the drug within the first month of treatment. CMS and Novartis are also working on other value-based payment systems for new indications for the drug that FDA still is reviewing. Novartis is working on similar arrangements with private payers.
According to Novartis, the unique qualities of the drug call for a new way of reimbursing for its use. Each dose is a customized treatment that uses a patient’s own T-cells, which are modified in a lab to include a new gene that contains a protein called a chimeric antigen receptor. This protein then directs the T-cells to target and kill leukemia cells when the cells are infused back into the patient. As Novartis works on FDA approval for using the drug to treat more types of cancer, other drug companies are working on their own gene therapy drugs. For example, Kite Pharma, recently purchased by Gilead Sciences, expects an FDA ruling on its drug by November 29.