Does CAR-T Therapy Have a Payment Problem?

3d illustration of immune system T cells attacking cancer cells, as in CAR-T therapies

By many standards, and certainly by the way the media covers it and industry promotes it, immuno-oncology therapies using CAR-T are revolutionizing cancer treatments. But what if, as the saying goes, they threw a revolution and nobody came? Or more precisely, what if they threw a revolution and no one was willing to pay for it?

Because CAR-T seems to have hit a bit of a snag—payers are reluctant to pay for it.

There are currently two chimeric antigen receptor T-cell (CAR-T) therapies approved by the U.S. Food and Drug Administration (FDA). They are Novartis’ Kymriah (tisagenlecleucel) and Gilead Sciences’ Yescarta (axicabtagene ciloleucel). They have been approved for slightly different, but sometimes overlapping patient populations. In the case of Kymriah, it is approved for pediatric and young adult acute lymphocytic leukemia (ALL) and for recurring or relapsing (r/r) aggressive lymphomas. Yescarta is approved for similar aggressive lymphomas.

Because of the potential for significant side effects, primarily cytokine release syndrome and neurotoxicities, the FDA required both companies set up Risk Evaluation and Mitigation Strategies (REMS) programs, which ensure that hospitals and associated clinics that dispense the therapies are specially certified and have on-site access to treatments for those adverse effects.

David Maloney, medical director of the Bezos Family Immunotherapy Clinic and director of cellular immunotherapy at Fred Hutchinson Cancer Research Center told BioSpace earlier this year, “These types of therapies are totally different than any other cancer therapies. They are essentially living cells that actually replicate and grow in the patient as they attack the cancer. It’s exactly the opposite of chemotherapy, which goes in and causes damage, and the damage is slowly resolved over time. CAR-T cells are infused in a relatively small number of cells that actively grow as they engage the target tumors cells and kill them. It is a type of living therapy that can expand to eradicate all of the tumor.”

But the treatments are expensive. As NPR wrote in July, “Kymriah and Yescarta cost $373,000 for a one-time infusion to treat adults with advanced lymphomas, while Kymriah costs $475,000 to treat acute lymphoblastic leukemia in children and young adults. That’s’ the cost of the drug itself; in addition, many patients experience serious side effects that can land them in a hospital intensive care unit for weeks, pushing treatment costs to more than $1 million.”

Typically, commercial insurers are covering CAR-T therapies. Generally speaking, they do it on an individual basis. Smaller or regional plans don’t necessarily have experience with the therapies, and approvals are sometimes adding weeks to the process.

“A request for CAR-T may end up with somebody on the payer authorization team who doesn’t understand the technology or the urgency of the request, when somebody has only weeks or months to live,” Stephanie Farnia, director of health policy and strategic relations at the American Society for Blood and Marrow Transplantation told NPR.

And reportedly, Medicare and Medicaid approval is an even bigger challenge. Some Medicaid programs won’t cover CAR-T. Matt Salo, executive director of the National Association of Medicaid Directors, told NPR, “Medicaid is a finite pot of money, and it’s stretched threadbare even on a good day.”

Medicare provided payment rates last spring for providers who administer Yescarta and Kymriah to outpatients, which would cover the costs of the drugs. NPR writes, “Medicare beneficiaries’ out-of-pocket costs would be capped at $1,340 plus the beneficiaries’ Part B deductible (if that hasn’t already been met), the agency says.”

The Catch-22 here is that the facilities that provide CAR-T—which are limited by FDA regulations; there are only 51 in the U.S.—typically provide treatment on an inpatient basis. That inpatient choice is based on the high risk of side effects.

Peter Bach, director of Memorial Sloan Kettering’s Center for Health Policy and Outcomes, recently wrote an editorial for The New England Journal of Medicine looking at CAR-T payment policies. He noted that United Healthcare, a provider of Medicare Advantage plans, requested that the Centers for Medicare & Medicaid Services (CMS) conduct a national coverage analysis (NCA) of CAR-T therapy. United, he writes, “argued that implementing a single coverage policy for CAR-T therapy across Medicare would level the financial playing field for competing plans and ensure equal access. NCAs do usually result in uniform coverage across Medicare; without them, coverage often varies among regions and plans.”

It’s possible CMS will find that clinical trial results show CAR-T “provides a net benefit for Medicare patients.” One tough part there is that most trials so far have not included large numbers of patients 65 years or older, which is the eligibility age for Medicare. It could also design a payment strategy for CAR-T that promotes price competition. There are also more complex plans it might consider.

Bach concludes, “CAR-T therapies have broken new ground on many fronts—they have shown efficacy in patients who previously had few options, but they cost multiple times what any previously approved cancer therapy costs. Their rapid approval based on small, uncontrolled studies reflects their promise. But they are no panacea.”

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