Commercializing Cell & Gene Therapies: What's the strategic horizon?

Some strategy thoughts after chats with dozens of company leaders at the ARM's Cell & Gene Tx Meeting on the Med in Rome last week…

🧬 There is a business paradox when it comes to small biotechs in the Cell & Gene/ATMP industry. They increasingly want to lead their assets through to commercialization instead of out-licensing and turning the reins (and the upside) over to Big Pharma. Admirable goal here! But too often, they don’t know what they don’t know. And that can mean unforeseen issues pop up around the launch time that could have been mitigated with planning. Some of the best scientific leaders don’t have expertise on their teams in the policy, access, value, RWE, HTA arenas, and that can make their launch falter. (leading to our next point…)

👩🔬 There’s a misperception that commercial, value, and access discussions (a) aren’t needed at pre-clinical/early clinical stages or (b) are prohibitively expensive and would require FT commercial leadership hires. Neither is the case. The science, partnering, and development teams in early-stage biopharma should be talking to commercialization and access experts very early on to understand the opportunities for proactive evidence planning and understanding the reimbursement and HTA landscape they will be launching into (even if far away!) Especially as many of these companies can launch an asset with a single arm study in an earlier phase, and/or achieve accelerated approval timelines, commercialization and access issues can come at you FAST! A tiny investment can save millions  later on by avoiding expensive missteps. For example, I came across companies that were not aware that they would need to get early scientific and technical input from German HTA bodies prior to their registrational trial, even if that is a Phase II trial. Finding out too late can be very painful indeed.

🧪 Let’s talk more about timelines, runways, and a tight financing environment, as well as US/Europe dynamics. Everyone is trying to do more with less in a (comparably) high COGS sector and a squeezed fundraising environment which will likely persist through much of 2024. As a result, many companies are launching in sequence rather than in parallel. This creates some unique risks. The European market is smaller and has more difficult HTA hurdles, and while approval/launch will provide a bump to valuation, it may not be as impactful as a larger US launch, and many European companies are unfamiliar with US reimbursement paradigms and what needs to happen on the policy influence side as well as the US KOL side. Launching in the US first, though, if boxes haven’t been checked for early scientific and technical input to trials from European HTA (see note above about Germany, and also consider NICE in the UK) can mean majorly delayed European reimbursement and marketability. More than one CGT manufacturer has struggled on this in Europe or left that market—resulting in a suboptimal story for patient access. Again, trying to save costs by launching sequentially rather than globally in parallel can work, but only if all of the timelines and tasks across these markets are known and planned for prior to the first launch. This is tricky to get right!

🏁 Getting to the finish line of the clinical and economic value differentiation—what can companies think about? Data, evidence, endpoints, and data systems that enable ongoing clinical development (and post-approval activities like outcomes based agreements and proving an ongoing value proposition) are more important than many early-stage companies realize. For products going to market with single arm studies, understanding comparators that can be sourced from published datasets, RWE, or historical data is of critical importance for payer value proposition and achieving reimbursement in many markets particularly those outside of the United States. Understand your data sources early on, and also understand that not all commercially-available RWE is as high-quality as its marketing materials claim. Evidence makes your value story; data lets you capitalize on it. 

💰 We are going to see rapid acceleration of novel payment models, from value/outcomes based agreements (thanks  CMS/CMMI/Medicaid?) and with private payers interested in experimenting now that list prices >$1M are no longer an anathema. (Some of us remember when the first cancer drugs >$100k/year came out, and all of the fuss.) 🤷♀️ Payers are getting clever and tough, both around models to finance these therapies or around avoiding financial liability or restricting coverage. Evidence and data are the manufacturer and patient tools to fight for access! Companies should make sure they are investing wisely; it’s “buyer beware” when it comes to commercially available datasets for RWE. Maybe invest in building their own registries in collaboration with patient advocacy? A wise few groups are.

Bottom line? Revisit your commercial and access roadmap early and often, even if it seems like a distant horizon when your scientific program is at the IND-enabling or Phase I stage. Savvy biotech VCs are starting to ask the questions around access, pricing, and reimbursement models that the Big Pharma partnering/BD&L teams have been incorporating into their asset assessments and licensing/acquisition strategies. As a small biotech, it would behoove you to have a few smart answers around things like expected payer mix, site of care, synthetic comparators/controls, and prioritization of geographic markets. The good news is that these can be achieved with a fairly modest investment and fractional expertise, and the upside leads to launch success.