Is Bluebird Bio's European exit a canary in the coal mine?

In an August 9th press release, Bluebird Bio announced its intentions to scale back European operations, citing a challenging market access environment. Andrew Obenshain, president, severe genetic diseases, said:

"bluebird’s decision to focus on the U.S. market is driven by the challenges of achieving appropriate value recognition and market access for ZYNTEGLO in Europe, which makes bringing its transformative gene therapies like ZYNTEGLO and SKYSONA to patients and physicians in Europe untenable for a small innovative company at this time"

Zynteglo (betibeglogene autotemcel) is a gene therapy for a blood disorder known as beta thalassaemia, which is already approved by the European Medicines Agency (EMA). Skysona, a gene therapy for the treatment of children with cerebral adrenoleukodystrophy (CALD), a severe form of a rare inherited neurological disease, is also approved by the EMA. As Andrew Obenshain of Bluebird notes:

"While European regulators have been innovative partners in supporting accelerated regulatory paths for these therapies, European payers have not yet evolved their approach to gene therapy in a way that can recognize the innovation and the expected life-long benefit of these products.”

Regulatory approval by EMA is required for the marketing of any medical product in the European Union, however following central approval, manufacturers must deal with individual country-level payers to negotiate reimbursement in national health systems - a process that can be time consuming and laborious.

Several characteristics of gene therapies set them apart from small molecule and biological medicines. They require substantial expertise to manufacture and administer, frequently require only one or a small number of infusions, and are intended to confer long-term or even life-long benefit. Additionally, the often rare- or ultra-rare indications mean very few patients have been treated as part of the clinical development programme, with a relatively short follow-up time, leading to substantial uncertainty of efficacy. In turn, and in combination with very high prices, this can raise concerns with payers about the clinical benefit or broader value of treatments.

Following the announcement, investors reacted and Bluebird share value dropped by around 26%. In the global context, Top-5 European countries account for just under 20% of sales of new pharmaceuticals. The exit of a leading innovative manufacturer of advanced therapies should be cause for concern:

• Many European countries have long standing and internationally recognised Health Technology Assessment (HTA) agencies, responsible for assessing the clinical, economic and societal value of innovative medicines. While these systems and processes have arguably worked well for traditional medicines, experts agree they are not well suited for gene therapies, and mechanisms are lacking for their introduction in European markets
• We know from other therapeutic areas that market failures are real, and where there is a limited expected return on investment, companies do not launch their products. In an analysis of newly developed antimicrobials, which are also subject to challenging reimbursement conditions and limited market sizes, a recent analysis found that majority of countries had access to fewer than half of recently developed products, with most products being marketed only in the United States, United Kingdom and Sweden, which all have favourable conditions for this drug class.

The processes of HTA, the reimbursement decisions they reach, and the prices ultimately agreed are all part of the signals that public payers send to industry about their priorities and willingness to pay for innovative therapies. Bluebird's exit may be an early warning that European market conditions are simply not favourable - this could put European countries at the back of the queue when it comes to access to these therapies, or worse, trigger a reduction in commercial interest in their development.

Further development of collaborative cross-country assessments and pricing/reimbursement negotiations may be part of the remedy. The Beneluxa Initiative coordinated the collaborative appraisal of Novartis' gene therapy Zolgensma in Spinal Muscular Atrophy. Similarly, the Nordic countries (Denmark, Norway, Sweden, Finland and Iceland) have collectively assessed Bluebird's Zynteglo as part of the FINOSE network, but the final pricing and reimbursement negotiations were conducted bilaterally between countries and Bluebird. Although these initiatives are useful and introduce a welcome reduction of duplication, they still operate in a relatively ad-hoc fashion that is not likely to have a major impact on investment decisions at this time.

A more systemic approach is currently being hosted by the World Health Organization Regional Office for Europe, in collaboration with the Norwegian government. The Oslo Medicines Initiative aims to create a collaborative forum where industry actors and member states can collectively address challenges and solutions to improving access to novel, high priced medicines across the region, including high priced gene therapies. Focusing on solutions at a regional level, the initiative aims to create a model suitable for global roll-out, and presents an opportunity for companies, such as Bluebird Bio, to take part in these discussions together with relevant stakeholders. 

However, the news of Bluebird's European exit is a canary in the coalmine for European stakeholders, and a clear call to action for payers in particular to ensure national processes are fit for purpose for the appraisal of this new class of treatment.