Fitting a Rare Peg into a Round Hole

By Robert Murphy

People like to put things into less-then-perfect, but convenient, boxes. It helps us make sense of the world by taking large, disparate pieces of information and grouping them into more digestible bites.

This tendency may work reasonably well for food, wine or movies. When it comes to establishing prices for orphan drugs for rare diseases, well … not so much.

Drug prices are a growing source of frustration, concern and debate for all players involved in our healthcare system. Too often, reimbursement is determined by players removed from the front lines of treating patients. In theory, decisions that determine access to new therapies are based on an analysis of clinical benefits and cost-effectiveness compared with the current standard of care.

Unfortunately, when payers try to get their hands – and wallets – around the rising cost of prescription drugs, they may make generalizations that fail to take into account the specific needs of patient communities and the potential long-term benefits of new therapies.

This is especially true for orphan drugs intended to treat rare diseases, where the latest treatments such as gene therapy may cost upwards of $1 million per patient. There are valid reasons why these treatments are so expensive: they provide a one-time treatment for an extremely small patient population, they require significant upfront R&D investment costs, and the manufacturing process is complex and costly.

Often, these treatments do not fit the established framework for determining pricing and reimbursement. The traditional model does not consistently take into account important criteria like patient quality of life or the additional medical costs to the healthcare system associated with increased morbidity and mortality.

Likewise, it may not take into consideration the benefits of restored health: effective treatment makes it possible for patients to be more productive and contribute more to their families, communities and society. There has to be a better, more holistic way of gauging the full value of a drug, setting a fair price, and ensuring access for all patients who can benefit.

With this goal in mind, the trade organization BioNJ recently hosted a conference titled, Beyond Value Frameworks: Defining the Value of Medical Innovation. Industry experts explored tools to define value, including data technologies to analyze real-world evidence to precisely predict which patients will benefit the most from specific therapies. This information could then be used to maximize patients’ ability to gain access to these treatments.

Presenters also offered concepts for defining patient-centered measures of value. Some of these focused on longer-term clinical benefits to the patient and healthcare system through overall cost savings of treatment and increased productivity.

At a time when too many people with rare diseases live without access to an effective treatment, it’s encouraging to see experts working together to flex the system to fit the disease. When we avoid trying to shoehorn rare diseases into the current reimbursement system, everyone wins.