United States: View From The Horizon: Digital Health And Cell, Tissue, And Gene Therapies In Boston

On April 30 our new global series, Life Sciences and Health Care Horizons, kicked off in Boston with two panel discussions that focused on the challenges and opportunities that our lawyers and clients are facing in two emerging markets in the industry: (1) cell, tissue, and gene therapies; and (2) digital health technology. This was the first event in a series that will span three continents over the next six months and focus on issues impacting industry leaders around the world. We are excited to share the following highlights from Boston, and we look forward to future discussions as we forecast and help clients prepare for what’s to come.

Cell, Tissue, and Gene Therapies

Cell, tissue, and gene therapies are an emerging area of focus for many life sciences companies in 2019. Since FDA’s approval of the first gene therapy, Novartis’ Kymriah™, in 2017, several other companies are anticipating approval of their cell, tissue, and gene therapy products and over 1,000 more companies are currently engaged in clinical trials.

Our panelists discussed and analyzed the challenges facing these cell, tissue, and gene therapy products, which start in the investigational stage and run through commercialization stage. Vadim Lubarsky, Executive Director of CMS Policy and Reimbursement at Novartis, described the reimbursement and operational issues that Novartis has faced since taking the first FDA-approved gene therapy to market. According to Mr. Lubarsky, the current regulatory framework was not built to properly account for these “one-time curative products” and Novartis has been one of the pioneering companies in the value based pricing for in the gene therapy market. Hogan Lovells partner Ken Choe echoed this sentiment, highlighting the fact that stakeholders throughout the cell, tissue, and gene therapy market, including manufacturers, health care providers and distributors, are continuing to push for regulatory reform, and part of that reform includes different drug pricing models. “Innovative products with reimbursement issues are the ones that lend themselves to [value-based pricing models],” according to Mr. Lubarksy. From Mr. Choe’s perspective, the biggest issue for value-based pricing models is the Medicaid drug rebate program, which discincentivizes manufacturers from having a low best price.

Hogan Lovells partner Hein van den Bos, who is based in our Amsterdam office, described a similar struggle in the EU regulatory framework for these products. Adding additional hurdles is the fact that pricing for these products must be negotiated on an EU-member state level and, depending on logistics, these products may require additional EU member state licenses.

From the commercial contracting perspective, we heard from Adriana Tibbitts, counsel at Hogan Lovells, who explained that the sheer number of contracts associated with these products creates an operational hurdle associated with launch. Mr. Lubarsky agreed with this sentiment, explaining that Novartis had to put hundreds of contracts in place in connection with the commercial launch of Kymriah™. As we continue to see more products approved, we expect that the contracting process will become more streamlined.

As closing remarks, Hogan Lovells partners Michael Druckman and Hein van den Bos echoed what other panelists had noted, which is that as we look to the future of these products, we see a changing landscape from a regulatory, insurance and commercial perspective.

Bridging the digital divide: Developing innovative digital health therapies that integrate a drug and a device

Digital health promises to bring digital technology into the health care arena, improving health and reducing costs. A key area of digital health innovation is the integration of digital health technology with pharmaceutical products. From enhancing access to medicine through telemedicine, to addressing non-adherence with medication-embedded sensors, to prescription digital therapeutics, digital health technologies are reshaping the medical landscape.

Susan Lee, a partner on Hogan Lovells’ Global Digital Health Team, moderated a panel discussion with industry leaders focusing on the future of digital health development and adoption for therapies combining a prescription drug with a medical device. The panel featured Tracy Palmer Berns (Chief Compliance Officer, AMAG Pharmaceuticals), Bruce Carroll (Vice President, Healthcare Policy and Market Access, Proteus Digital Health), Yuri Maricich (Chief Medical Officer and Head of Clinical Development, Pear Therapeutics), and Hogan Lovells counsel Brooke Bumpers.

Panelists highlighted the legal and regulatory challenges impacting the ability to bring these products to market, including FDA’s evolving understanding of digital health technology and application of the 21st Century Cures Act. Panelists noted that even combining an approved drug product with a well characterized digital technology requires substantial regulatory review, as was the case with Abilify MyCite®, the first FDA-approved “digital pill” intended to track the ingestion of medicine.

Similarly, launching prescription digital therapeutics—software-based disease treatments—requires working with FDA to provide a framework for developing products and keeping pace with the need to provide routine software updates. Regulatory innovation, such as FDA’s Software Pre-Certification Pilot Program, was described as essential to ensure the safety and efficacy of products, while enabling digital therapeutics to adapt and improve software without lengthy review processes.

The panel also addressed payment and reimbursement arrangements for digital health products. With enhanced data collection, payment models based on a variety of patient outcomes are possible, and commercial insurers in particular have been open to developing value-based arrangements. Brooke Bumpers noted that payers recognized the potential benefits and cost-savings, but wanted evidence based on established metrics to demonstrate their value.

In addition to educating payers about the value of digital health technologies, the panel discussed the need to engage with patients and health care providers to drive demand and adoption of emerging therapies. Increasing awareness of digital health options and building trust in the use of technology were seen as key to spurring adoption. Panelists spoke about the importance of a regulatory framework that encourages innovation but provides safeguards against ineffective or harmful products to maintain confidence in digital health technology, generally.

The discussion concluded with panelists sharing their optimism that in the near future payment models will develop that will embrace more widespread use of digital health therapies. One panelist predicted that, with increased adoption, we will stop thinking of the products as “digital health” and will view them simply as health care products and therapeutic options.

Life Sciences and Health Care Horizons – Global Event Series

From spotting trends in digital health innovation to breakthrough cures and navigating fluid regulatory landscapes, the Hogan Lovells’ Life Sciences and Health Care Horizons event series will span three continents and feature cutting-edge analysis, engaging panel discussions, and featured keynote speakers.

Save the date

30 April: Boston

16 May: London

27 June: Paris

30 Oct.: Tokyo

6 Nov.: Shanghai

13 Nov.: Northern California

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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