In 2010, the world’s most expensive therapy was Soliris (eculizumab), costing around USD 409,500 per patient per year. Today, prices for advanced gene therapies have escalated far beyond this benchmark, with list prices now often exceeding €1–3 million per patient.1,2 Rapid advances in gene-editing, viral-vector, and ex vivo gene-addition platforms are delivering disease-modifying therapies with curative potential. However, bespoke manufacturing requirements, stringent cryo-logistics, and very small patient populations are driving list prices beyond reach for many healthcare systems. Furthermore, pivotal trials are typically small in scale and often lack long-term follow-up data, particularly for chronic conditions, leaving health technology assessment (HTA) bodies facing uncertainty around durability of response, comparative efficacy, and long-term safety.
Innovative payment models (IPMs) help address this uncertainty by decoupling the budget impact from the moment of administration and instead linking payments to observed real‑world benefits. Some examples of IPMs include:
- Outcomes-based Agreements (OBAs): Contracts between payers and manufacturers where payment or reimbursement is linked to the real-world performance of the therapy. If the agreed clinical or economic outcomes are not achieved, the manufacturer provides rebates, refunds, or price adjustments
- Amortised (Annuity) Payment Plans: A financial model that spreads the high upfront cost of a therapy across multiple years through instalments. Some annuity models are contingent on therapeutic performance similar to that of outcome-based agreements.
- Warranties: Manufacturer guarantees that the therapy will deliver a minimum agreed benefit, with financial compensation if it fails within a set period.
- Milestone Rebates: Payments are linked to achievement of pre-agreed clinical or health outcome milestones over time. If milestones are not met, partial rebates are triggered.
Innovative Payment Models: Real-World Application
Manufacturers of high-cost gene therapies are increasingly offering national reimbursement systems a range of flexible, customisable payment models. One example is Libmeldy (atidarsagene autotemcel), a one-time gene therapy developed for the treatment of metachromatic leukodystrophy (MLD), a rare and often fatal genetic disorder caused by mutations in the ARSA gene. These mutations lead to a deficiency of the arylsulfatase A enzyme, resulting in the accumulation of sulfatides in the nervous system and progressive loss of motor and cognitive function. Given its one-time administration, Libmeldy offers the potential for long-lasting benefit in a condition with otherwise very limited treatment options; however, it comes with a list price of approximately €2.9 million.
OBAs have been proposed for Libmeldy in markets such as the Netherlands.3 While the precise contractual details have not been disclosed, modelling based on clinical trial data suggests that such agreements can significantly reduce financial risk for payers if the therapy’s real-world effectiveness is equal to or below expectations.3
The modelled OBA ties payment to patient outcomes measured using the gross motor function classification in metachromatic leukodystrophy (GMFC-MLD) score, a seven-level classification system that assesses motor function. Patient motor function is evaluated at baseline (T = 0) and then at 12, 24, 36, 48, and 60 months following administration of the therapy.3 Linking payments to these outcomes ensures that reimbursement more closely reflects the actual clinical benefit delivered, rather than relying solely on the upfront list price.
The challenges of implementing these types of payment models include complex contract negotiations, as payers and manufacturers must agree on outcome definitions, timelines, and data thresholds. Data collection and infrastructure requirements can also be substantial, since robust, long-term follow-up is needed to reliably measure outcomes such as the GMFC-MLD score.
From the manufacturer’s perspective, outcome-based reimbursement models introduce a new layer of uncertainty around revenue generation. Unlike traditional one-off payments, revenue streams are spread over several years and are contingent on meeting predefined clinical milestones. This means that if the therapy underperforms in real-world settings, manufacturers may not recover the full list price, leading to potential revenue shortfalls.
However, many companies view this trade-off as acceptable. By adopting such models, manufacturers can still secure earlier market access and ensure that at least a proportion of revenue is guaranteed. In practice, this allows them to begin recouping the substantial research and development investment required to bring a complex gene therapy to market. While the financial upside may be lower compared to immediate full reimbursement, the stability and predictability offered by partial payments linked to outcomes can be strategically valuable, particularly in high-cost, high-risk therapeutic areas.
Conclusion
IPM’s represent an important tool for balancing the competing needs of payers and manufacturers in the era of ultra-high-cost therapies. For payers, these models offer greater flexibility, allowing them to mitigate clinical and financial risks, manage budgetary pressures more effectively, and often times provide access to treatments in areas where no viable alternatives exist. For manufacturers, they provide a mechanism to recoup at least part of the substantial investment required to develop transformative therapies.
There is no universal template for structuring these agreements, they are often complex to design, challenging to administer, and the subject of protracted negotiations. Nevertheless, as gene and cell therapies with price tags in the millions continue to enter the market, IPM’s will likely become not just a desirable option, but a necessary feature of sustainable healthcare financing.
Remap Consulting are specialists in pricing and market access, with extensive experience supporting launches in cell and gene therapies for orphan and ultra-orphan conditions. If you are preparing for launch and would like to understand how IPMs could be designed and implemented for your product, we invite you to get in touch with one of our experts here.
References
- Commerce P. The world’s most expensive drug: Alexion Pharmaceutical’s Soliris per year. Accessed 03/09/2025, 2025.
- Staines R. Novartis offers reimbursement options as EU backs costly SMA therapy. PharmaPhorum. Accessed 03/09/2025, 2025. https://pharmaphorum.com/news/novartis-reimbursement-options-as-eu-approves-ultra-pricey-sma-drug
- Callenbach MHE, Schoenmakers D, Vreman RA, et al. Illustrating the Financial Consequences of Outcome-Based Payment Models From a Payers Perspective: The Case of Autologous Gene Therapy Atidarsagene Autotemcel (Libmeldy®). Value in Health. 2024/08/01/ 2024;27(8):1046-1057. doi:https://doi.org/10.1016/j.jval.2024.05.010
