Is cell and gene therapy covered by health insurance?

Insurance companies are playing catch-up to keep pace with the rapidly evolving field of cell and gene therapies. While the majority are not covered by health insurance yet, some are covered by certain insurance providers and structures are being put in place by the Centers for Medicare & Medicaid Services to cover such therapies starting 2025.

What is cell and gene therapy?

People can experience severe incurable diseases due to their genetics. When important genes are missing or nonfunctional, that can manifest as a lifelong illness that takes a toll on the patient’s quality of life while increasing healthcare costs. Cell and gene therapy uses the knowledge gained from a patient’s genes to tailor a therapy for them. The drug is generally a specific protein often produced by the patient’s own cells. The therapies are being used to treat incurable hereditary diseases such as sickle cell anemia, as well as hemophilia and certain types of cancer.

Different gene therapies can work in different ways. The therapy may make changes to the patient’s genome to add genes that enable the patient’s body to make a therapeutic protein. Or it may deliver the gene that encodes a drug to an afflicted organ which directs the cells in that organ to generate the drug but the gene itself does not get incorporated into the cells’ genome. The therapy can also be very specific to the patient, where a patient’s own tumor cells are used to generate a therapeutic for them. Due to the transformative nature of cell and gene therapy and how it can cure some hereditary diseases in a single treatment, payers are innovating ways to support gene therapy.

FDA-approved cell and gene therapies

To date, the FDA has approved 37 cellular and gene therapy products. The number is likely to go up in the future as cell and gene therapy treatments targeting diseases including Type 1 diabetes, different types of aggressive cancers, and solid tumors are currently in clinical trials. Most gene therapies are a one-time treatment.

Examples of FDA-approved cell and gene therapies and their price tags

• On December 8, 2023, the FDA approved two gene therapies- CASGEVY^TM and LYFGENIA^TM to treat sickle cell anemia in those over 12 years of age. The disease occurs due to an inherited mutation in a gene that encodes a subunit of hemoglobin. The mutated hemoglobin does not carry oxygen well and tends to clump together causing the blood cells to take on a sickle-like appearance. The lack of oxygen can cause severe pain and organ damage. The two approved treatments use different strategies to introduce a healthy form of hemoglobin into the patient. Blood is collected from the patient and blood stem cells are isolated. The treatments use different ways to integrate different types of healthy hemoglobin into the blood stem cells. The cells are introduced back into the patient where they engraft into the bone marrow and start producing the healthy hemoglobin subunit. CASGEVY^TM costs $2.2 million while LYFGENIA^TM costs $3.1 million.
• On March 27, 2021, the FDA approved ABECMA®, a therapy for multiple myeloma that makes prescription medicine using the patient’s own white blood cells. The white blood cells are extracted from blood collected from the patient and sent to a facility to make ABECMA®. The patient gets chemotherapy for 3 days to prepare their body for ABECMA®, which is then administered through an IV. The treatment costs $419,000.
• On December 16, 2022, the FDA approved ADSTILADRIN®, a therapy for high-risk Bacillus Calmette-Guérin unresponsive non-muscle invasive bladder cancer with carcinoma in situ with or without papillary tumors. The therapy involves delivering the gene that encodes interferon alfa-2b protein, a synthetic (man-made) cancer-fighting therapeutic, directly to the bladder where it can fight cancer. The treatment costs an estimated $500,000-750,000.
• On February 16, 2024, the FDA approved AMTAGVI^TM, a therapy for unresectable or metastatic melanoma- a skin cancer that cannot be removed surgically or has spread to other parts of the body. The therapy uses a patient’s own T cells to fight their cancer. It involves extracting a part of a patient’s tumor that contains cancer cells as well as the body’s cancer-fighting T-cells. The T-cells are isolated, rejuvenated, grown into billions, and administered back into the patient as a one-time therapy. The treatment costs $515,000.
• On May 24, 2019, the FDA approved ZOLGENSMA®, a therapy that treats spinal muscular atrophy caused by missing or nonworking SMN1 gene in infants under 2 years of age. The treatment uses a viral vector to deliver functional copies of the SMN gene to the infant’s motor neuron cells. Restoration of the SMN function by the new gene helps preserve essential muscle function and preserves motor neuron cells that would have died without treatment. This prevents spinal muscle atrophy from progressing. The treatment costs $2.125 million.
• On March 18, 2024, the FDA approved LENMELDY^TM, a therapy that treats pre-symptomatic and early-onset metachromatic leukodystrophy in infants <30 months of age and children up to 7 years old. Metachromatic leukodystrophy occurs due to a mutated arylsulfatase A (ARSA) gene which results in low or no production of the ASRSA protein. The symptoms include a gradual progression of muscle issues (e.g. weakness and falling) and cognitive decline. The one-time therapy restores a functional copy of the ARSA gene into the child’s own blood stem cells which can stop or slow the progression of metachromatic leukodystrophy. The treatment costs $4.25 million.

Are cell and gene therapies covered by health insurance?

Cell and gene therapies are rapidly evolving with new ones getting FDA-approved and many others in clinical trials. The treatments are a tempting avenue for research because they can potentially treat or cure otherwise incurable diseases by treating their root cause- such as adding a functional gene when the patient has a missing or dysfunctional one.

However, these therapies typically have high upfront costs that can run into millions of dollars. That can make them unaffordable to individuals unless they are covered by health insurance. One of the reasons why payers are considering covering these therapies is that they are a one-time treatment that can reduce life-long medical expenses. This is especially notable for gene therapies such as LENMELDY^TM and ZOLGENSMA® which are targeted to help infants before their genetic diseases start causing disease and disability. The effectiveness of cell and gene therapies and the durability of their benefits over time will likely advise insurance companies’ decision to cover such therapies.

Coverage of cell and gene therapies

• In January 2024, Blue Cross Blue Shield became the first insurance provider to cover gene therapy to cure sickle cell anemia.
• Recognizing the benefit of cell and gene therapy, the Centers for Medicare & Medicaid Services (CMS) has announced their intention to support such therapies through their Cell and Gene Therapy (CGT) Access Model. They note that while the upfront cost is high, there is a significant reduction in lifelong medical expenses as well as an improvement in the patient’s quality of life. The program will become accessible to states in 2025. States can begin participation between January 2025 and January 2026.
• Cigna has introduced the Embarc Benefit Protection® solution. The program covers 8 of the FDA-approved cell and gene therapies. These include LUXTURNA®, ZOLGENSMA®, ZYNTEGLO®, SKYSONA®, HEMGENIX®, ROCTAVIAN^TM, CASGEVY^TM, and LYFGENIA^TM.