October 23, 2019

Gene Therapies By The Numbers:

3 Strategies employers need to know about managing multi-million dollar treatments.

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The current state of gene therapy treatments and why employers are seeking innovative strategies to manage costs:

“By 2024, the cost of gene therapies is expected to reach more than $16 billion in the U.S.,” according to EvaluatePharma. With single treatments tipping the $1 million dollar scale, it’s no surprise that insurers and employers alike are looking to implement strategies that help them mitigate these costly treatments.

Gene therapy is a technique that modifies a person’s genes to treat or cure an inherited disease. While treatment can be life altering for patients, the high cost that comes along with it can burden employers with astronomical price tags.

A quick look at 3 common gene therapies and the average cost per treatment:

Gene Therapy Drug Treatment Average Cost Per Treatment
Zoglensma1 Treats spinal muscular atrophy (SMA) in young children $2.1M
Luxturna2 Treats inherited disorder that causes blindness $850,000
LentiGlobin3 Aims to treat beta-thalassemia major and severe sickle cell disease $1.2M


Employers are looking for guidance on setting conditions for who is eligible to receive these types of treatments as well as payment options that will help them cover the costs of these therapies.


3 Strategies employers need to consider implementing to manage treatment costs:


1) Managed Benefit Design – It’s important that companies design their coverage options to control costs now and in the future for the types of gene therapies they’re looking to cover.

A couple questions that should be considered:

  • Can my company survive a multi-million dollar claim?
  • Is there financial assistance available to help shoulder the cost?

2) Additional Insurance Coverage for Specific Treatments – More and more organizations are offering programs that will manage and pay for particular gene therapies for a fixed per member fee. Organizations need to determine if that is sufficient coverage and what the cost may be for those specific treatments.

3) Prior Authorization Management – Before a patient begins a therapy, companies should consider asking the following questions:

  • Has the patient tried and failed on current therapies?
  • Have all the recognized protocols and guidelines been followed?
  • Is the treatment safe?

Charting New Territory

Employers and insurers are faced with a challenge to find a balance between providing access to patients who need gene therapy and determining who is eligible to receive treatments. With payment protection plans being limited and unclear approaches to whether or not insurers will be able to lower the costs of gene therapies or spread them out over time, it’s important for employers to work with their health plan administrator to determine a strategy that equips them with the tools needed to help mitigate the potential high costs of gene therapy treatments.

Aligning with a trusted partner is critical to successfully managing your gene therapy costs. For more best practices, view more recent insights or contact our team directly.