Alliance for Regenerative Medicine

A ‘landscape analysis’ of reimbursement practices for cellular and genetic therapies

Alliance for Regenerative Medicine tries to rationalize how payers address economic value


This could be construed as getting ahead of the regulatory and reimbursement practices of global healthcare systems—or keeping up with them. In either case, the Alliance for Regenerative Medicine’s Research Foundation (ARM Foundation) has issued a “landscape analysis” of current evaluation and reimbursement structures for cellular and genetic therapies just getting onto the market now. This landscape analysis will be followed by a stakeholder panel, possibly meeting in the fall, and a white paper or other position statement after that, according to Morrie Ruffin, executive director of the ARM Foundation. The project was announced earlier this year, and IQVIA is onboard as a contractor.

The basic problem with cellular and genetic therapies—especially autologous ones that start with a patient’s own cells—is that the therapy is a blend of biopharma manufacturing processes and healthcare services as performed by hospitals and doctors. The end result of the process (usually) is one drug for one patient; and commercializations so far are expensive: $500,000-1 million. On the flip side, some of the therapies, sometimes, are curative: a cancer, for example, can be stopped cold. “We need to place these therapies in a context of their cost to healthcare, and their transformative nature,” says Ruffin.

Already, there have been innovative arrangements in the US and in Europe’s single-payer systems: Spark Therapeutics agreed to an “annuity-based” contract with CMS for Luxturna that spreads the therapy’s cost over many years; Amgen agreed to a pay-for-performance arrangement with the UK’s National Institute for Health and Care Excellence (NICE). Besides the governmental bodies in Europe that have weighed in with their health technology assessments (HTAs), the Institute for Comparative Effectiveness Research (ICER), the National Cancer Center Network and others in the US have produced their own assessments.

The ARM Foundation landscape analysis has settled (for the moment) on a list of 12 factors that should play into the “value framework” for pricing and reimbursement:

1. Population size
2. Lifetime horizon
3. Patient indirect costs
4. Patient non-medical costs
5. Caregiver indirect costs
6. Caregiver non-medical costs
7. Age of onset
8. Additional value for curative nature
9. Real world evidence
10. Innovative payment models/contracting
11. Societal economic impact
12. Patient-centered endpoints.
Even deciding how to investigate these inputs is a challenge; the landscape analysis sees a high resource investment to investigate No. 11, societal economic impact, but a relatively low likelihood of success in defining it.

The ARM Foundation is taking a bold and ambitious step in attempting to analyze not just US but global reimbursement policies in this area; but given that there are dozens of therapies being commercialized, and hundreds more behind them, it might be a just-in-time undertaking.