This is literally the topic of my TEDx earlier this year. We need business model changes/innovation in the business of health to match the speed at which invention and the tech stack is taking off. Otherwise cures and the like just sit on the shelf.
Drug companies are also using copay assistance for higher priced immunotherapy biologics that require infusion. Not millions but thousands of dollars of treatment a year. Infusion centers and biological are growing >10% a year. The copay assistance from the pharma company helps the patient pay the copay so the insurance pays for the continued payment from the insurance company. Of course the PBM is in the middle trying maximize payment to them. A wacky system.
Copay assistance programs create an artificial feedback loop: they neutralize patient price sensitivity, forcing insurers to pay full price. Notably, insurers are hitting back with copay accumulators, which exclude pharma aid from counting toward the patient's annual deductible. In my view, this is a financial arms race where the patient ultimately loses when assistance funds inevitably run dry.
Business innovation is critically lagging behind biotechnology, creating a financial "valley of death." Notably, about 90% of abandoned gene therapies fail not due to science, but due to a lack of viable reimbursement models. In my view, if we don't reinvent market access with the same audacity as genetic sequencing, we will own the codes of life without the means to use them.
Gene therapies are introducing mortgage-style health loans, where the cost of a one-time treatment is spread over decades for the insurer. Notably, some contracts now include "value-based reimbursement" clauses, where manufacturers refund part of the payment if a patient relapses. In my view, without shifting to this long-term, outcome-based financing model, medical innovation will remain a luxury for the elite, shattering the social contract of health insurance.
Thisis a really sharp breakdown of the dilemma. The reinsurance layer issue is understated, especially when those carriers can just exclude gene therapies entirely. Worked with payers on coverage models once and the actuarial uncertainty around single-dose cures vs. chronic management completely breaks traditional risk pooling. Cuban's escrow idea is basically just insurance with extra steps, but the real question is whether formulary exclusivity can survive when these therapies become standard of care.
This is literally the topic of my TEDx earlier this year. We need business model changes/innovation in the business of health to match the speed at which invention and the tech stack is taking off. Otherwise cures and the like just sit on the shelf.
https://www.youtube.com/watch?v=NbkW91PMGxg&t
Drug companies are also using copay assistance for higher priced immunotherapy biologics that require infusion. Not millions but thousands of dollars of treatment a year. Infusion centers and biological are growing >10% a year. The copay assistance from the pharma company helps the patient pay the copay so the insurance pays for the continued payment from the insurance company. Of course the PBM is in the middle trying maximize payment to them. A wacky system.
Copay assistance programs create an artificial feedback loop: they neutralize patient price sensitivity, forcing insurers to pay full price. Notably, insurers are hitting back with copay accumulators, which exclude pharma aid from counting toward the patient's annual deductible. In my view, this is a financial arms race where the patient ultimately loses when assistance funds inevitably run dry.
Business innovation is critically lagging behind biotechnology, creating a financial "valley of death." Notably, about 90% of abandoned gene therapies fail not due to science, but due to a lack of viable reimbursement models. In my view, if we don't reinvent market access with the same audacity as genetic sequencing, we will own the codes of life without the means to use them.
Gene therapies are introducing mortgage-style health loans, where the cost of a one-time treatment is spread over decades for the insurer. Notably, some contracts now include "value-based reimbursement" clauses, where manufacturers refund part of the payment if a patient relapses. In my view, without shifting to this long-term, outcome-based financing model, medical innovation will remain a luxury for the elite, shattering the social contract of health insurance.
Thisis a really sharp breakdown of the dilemma. The reinsurance layer issue is understated, especially when those carriers can just exclude gene therapies entirely. Worked with payers on coverage models once and the actuarial uncertainty around single-dose cures vs. chronic management completely breaks traditional risk pooling. Cuban's escrow idea is basically just insurance with extra steps, but the real question is whether formulary exclusivity can survive when these therapies become standard of care.