Gene Therapy Cost Impact
Gene therapies are the most expensive drugs in history — with list prices of $2–4 million per treatment. A single gene therapy claim can exceed the entire annual pharmacy budget for a small employer. The gene therapy pipeline includes hundreds of therapies in development — the number of approved gene therapies is expected to grow from 5 in 2023 to 50+ by 2030.
Pharmacy vs. Medical Benefit
Gene therapies are typically administered in a hospital or infusion center and billed under the medical benefit — not the pharmacy benefit. However, some gene therapies are dispensed through specialty pharmacies and billed under the pharmacy benefit. Understanding which benefit covers gene therapies is essential for stop-loss planning and cost management.
Emerging Solutions
IQ Insight
Emerging solutions for gene therapy cost management include: (1) risk pooling — spreading gene therapy risk across multiple employers; (2) outcomes-based contracts — tying payment to clinical outcomes; (3) installment payments — paying for gene therapy over 5–10 years; and (4) stop-loss coverage — ensuring gene therapies are covered by stop-loss. Evaluate all four solutions as part of your gene therapy risk management strategy.