Home » Bluebird Bio Has Serious Cash Flow Concerns; Inability To Strike Reimbursement Deals In Europe Partly To Blame

Bluebird Bio Has Serious Cash Flow Concerns; Inability To Strike Reimbursement Deals In Europe Partly To Blame

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Bluebird bio is a extremely revolutionary biotechnology firm which develops gene therapies for a number of uncommon genetic problems and cancers.

Abruptly, the corporate exited the European market final 12 months. Evidently, it’s because the corporate couldn’t strike offers with payers for its European Medicines Company (EMA)-approved gene therapies, Zynteglo (betibeglogene autotemcel; dubbed beti-cel) and Skysona (elivaldogene autotemcel; known as eli-cel).

Bluebird bio’s departure from Europe alerts tough seas forward for gene remedy builders, who’re making an attempt to realize market entry for his or her merchandise.

Initially, Bluebird bio set a $1.8 million list price for Zynteglo (indicated for extreme β-thalassemia; an inherited blood dysfunction), quickly after successful EMA approval for in June 2019.

The European approval of Zynteglo was a primary for bluebird bio and a notable milestone in gene remedy improvement. When Zynteglo was permitted, the corporate proposed to German payers an revolutionary reimbursement mannequin, which included each installment plans that unfold out funds over 5 years, and a pay-for-performance scheme that linked every installment to affected person profit. Right here, if a affected person experiences illness development, producers should present a partial or full refund.

This was an association bluebird bio stated it had reached with multiple statutory health insurances in Germany. An preliminary fee was to be made on the time of infusion. The 4 further annual funds could be made provided that no transfusions for transfusion-dependent β-thalassemia are required for the affected person.

In August 2021, bluebird bio announced it was withdrawing Zynteglo from the German market after failing to succeed in settlement with well being authorities on the remedy’s worth. Bluebird bio representatives have stated the worth proposed by German regulators, specifically, didn’t “replicate Zynteglo’s worth as a one-time remedy for a illness that usually requires lifelong blood transfusions.”

Provided that the corporate has now withdrawn from Europe entirely, evidently pricing negotiations with different European international locations additionally failed to succeed in agreements that have been mutually passable.

As well as, regardless of gaining approval from the EMA in July 2021 for Skysona – indicated for cerebral adrenoleukodystrophy, a extreme neurodegenerative illness – it’s unclear whether or not bluebird bio ever tried to safe a value-based settlement for this product.

In a Securities and Exchange Commission filing from December 2021, bluebird bio said that the choice to “discontinue operations in Europe resulted from extended negotiations with European payers and challenges to reaching applicable worth recognition.”

This raises questions as as to if European payers, in what bluebird bio known as “precedence markets,” have been reluctant to (additional) have interaction with bluebird bio. Or, was the corporate hesitant to offer worth concessions? Alternatively, have been the hurdles too excessive relating to implementation of value-based agreements? This would come with logistical obstacles with respect to proof era, in addition to institution of proof of efficacy, security, and sturdiness.

Clearly, bluebird bio wished European reimbursement authorities to acknowledge what it seen as the worth of its gene therapies, and accordingly present entry to sufferers who’re prescribed the therapies. However that presumes that the worth bluebird bio demanded aligns with the worth supplied by the therapies. As we all know from many new therapies, throughout a variety of therapeutic classes, typically worth and worth aren’t aligned. If bluebird bio didn’t budge on worth that may be an issue. Actually for any payer, not simply European entities. Although, in comparison with the U.S., European reimbursement authorities could be extra aggressive in demanding decrease costs as a result of they typically act as monopsonists or single purchasers.

With out realizing the small print of how low the German authorities wished the worth to be – or different payers, for that matter – it’s onerous to inform why negotiations failed.

However, it does increase the query whether or not bluebird bio may have come to an settlement if it had accepted a cheaper price than it initially wished.

Bluebird bio has stated it sees a “clear path to reimbursement in the U.S.” Whether or not that is true stays to be seen. First, the corporate should get its merchandise – indicated for β-thalassemia and cerebral adrenoleukodystrophy – permitted by the Meals and Drug Administration. This might very properly happen this year.

Then, it’s going to have to unravel the pricing and reimbursement riddle with payers. Whereas the U.S. market presents extra alternatives, given the shortage of monopsony, market entry will nonetheless be a serious hurdle and would require compromise on each side.

Bluebird bio’s travails in Europe are a wake-up name for the gene remedy trade. The event of gene therapies is tough sufficient. Throw within the problem of accomplishing market entry as soon as a product will get permitted, and the duty of reaching success on this space turns into even more durable.

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