Magazine Article | April 1, 2020

The Evolving Payer Focus On Prevalence In Rare Diseases

Source: Life Science Leader

By Cécile Matthews and Bhavesh Patel

Cécile Matthews
In recent years, several new drugs to treat rare diseases have been launched, giving hope to many small and often underserved patient communities. Researchers continue to see development of drugs for rare diseases as an important and potentially lucrative target — bringing the prospect of many new drugs in the years ahead.

These therapies often do and will have high price tags, but the fact that they would be used by small numbers of patients means that the impact on payers and health systems has so far been considered manageable, especially

Bhavesh Patel
when compared to levels of lifelong care many rare disease patients often require when treatments are not available. A recent analysis of trends in payer decisions related to reimbursement indicates that payers are looking at a range of issues, including disease prevalence, with new levels of scrutiny and are working to rein in pricing of many rare disease treatments.

As more manufacturers invest in clinical development of rare disease therapies, and more of these products are positioned to enter the market, the economic burden they collectively present to healthcare systems and payers is growing rapidly. As a result, many payers are now looking closer at disease prevalence estimates as they make reimbursement determinations. There are also signs that they are less willing to overlook the limitations on clinical data often associated with these drugs. In many cases, payers are aggressively negotiating rebates and setting budget limit thresholds.

At CRA, we conducted an analysis of 15 rare and ultra-rare disease therapies recently approved in France, Germany, Italy, Spain, the U.K., and Japan to better understand the factors payers are now considering for reimbursement of rare disease drugs. The analysis worked to assess the relative importance of different factors and how conclusions were reflected in pricing decisions. We reviewed factors including average annual treatment cost (AATC), unmet medical need, payer authority evaluations, and drug dosing strategies, in addition to disease prevalence rates as reported by the EMA or in the literature.


In the analysis, researchers focused on three ultra-rare disease products — Kanuma, Strensiq, and Brineura — as well as select therapies approved to treat rare diseases including cystic fibrosis (CF) and pulmonary arterial hypertension (PAH).

Kanuma, approved for treatment of lysosomal acid lipase deficiency (LAL-D), was found to have a high AATC relative to other treatments for ultra-rare diseases. Unlike some drugs to treat rare diseases, Kanuma is supported by robust data and a strong clinical profile that was a key consideration in pricing decisions. Infants treated with Kanuma demonstrated an increase in growth improvements and survival rates, and a placebo-controlled pivotal trial involving both children and adults met its primary endpoint. Considering these factors, price negotiations resulted in per-pack list prices of approximately €5,900 ($6,459) in Germany, €6,500 ($7,115) in Italy, and €8,900 ($9,743) in Spain. The range highlights the fact that payer assessments can vary widely in different countries. The higher list prices in Italy and Spain, however, may be offset by previously agreed upon and confidential net price discounts.

"Many industry insiders agree that payers will likely continue to apply higher levels of scrutiny to factors including disease prevalence during pricing negotiations for rare and ultra-rare disease drugs."

As with Kanuma, pricing negotiations for Strensiq to treat childhood-onset hypophosphatasia involved careful review of the drug’s clinical profile and assessment of unmet need in patients. Payers considered the fact that patients typically experience a range of symptoms with varying severity (including skeletal malformations that can be fatal) and the lack of treatment options. They also reviewed results from a single-arm clinical trial that showed improvements in X-ray appearance of patients’ wrists and knees compared to historic controls. For payers in Spain, these results were deemed insufficient, and they requested additional clinical data before granting reimbursement. Prevalence estimates for hypophosphatasia also may have played a role in Strensiq’s price; however, estimates varied depending on the calculation methods used, payer location, and severity of patients included in the review. Strensiq is approved to treat both severe and mild forms of hypophosphatasia, but payers seemed to focus primarily on its use in more severe cases when making pricing decisions.

With Brineura, discrepancies between measures of disease prevalence and incidence, which are notoriously difficult to develop and confirm, appeared to be significant enough to affect pricing decisions. The prevalence of ceroid lipofuscinosis type 2 (CLN2) disease is about one in 2 million, while its incidence is about one in 200,000. When European payers reviewed Brineura for treatment of CLN2 disease, the incidence indicated a higher number of treatable patients. In the German assessment for Brineura, it appeared that payers took only disease incidence into account when calculating the likely patient population, and Brineura was awarded an AATC of €530,000 ($580,217).

Another important consideration for payers now is the availability of alternative therapies. Both Kalydeco and Orkambi were approved to treat CF patients with specific genetic mutations, but they achieved significantly different prices. Kalydeco was first approved in 2012 for treatment of CF patients with a mutation in the G551D gene; it was later approved for treatment of additional mutations that cause CF. Orkambi was approved in 2015 for treatment of CF patients with a mutation in the F508del gene, which is a more common CF mutation. As a result, Orkambi was expected to treat more patients than Kalydeco, consistent with a lower AATC.

In another example, Opsumit, Adempas, and Uptravi all were approved for treatment of PAH within a few years. Adempas was approved only four months after Opsumit, but for two indications: PAH and chronic thromboembolic pulmonary hypertension (CTEPH). But the second indication resulted in only a slight increase in the number of treatment-eligible patients based on EMA estimates. Accordingly, both drugs ultimately achieved a similar AATC as a result of similar disease prevalence estimates and launch dates. In Japan, Adempas achieved a slightly lower AATC compared to European markets; perhaps payers anticipated an increase in patient volume and budget impact with the second indication and may have used this information to negotiate a lower AATC. Finally, Uptravi was approved, but restricted its indication to patients who have failed or are ineligible for first-line treatments, leading to a higher AATC than Opsumit and Adempas in all markets except Japan. European payers likely considered the fact that the drug would treat a smaller number of patients compared to other therapies on the market.


Many industry insiders agree that payers will likely continue to apply higher levels of scrutiny to factors including disease prevalence during pricing negotiations for rare and ultra-rare disease drugs. Drug developers should consider this new reality as they assess the potential impact of, and limitations on, factors including the robustness of clinical data, magnitude of clinical benefit, burden of disease, and lack of available treatment options. Manufacturers also may need to align with stakeholders including patient advocacy leaders and clinicians to provide the full range of perspectives that payers will require in the years ahead in pricing negotiations.

The authors wish to acknowledge the contribution of Owen Male to this article.

CÉCILE MATTHEWS is a principal in the Life Sciences Practice at CRA with 20 years of experience in strategy consulting for the pharmaceutical industry. Her areas of expertise include pricing, reimbursement, and market access globally.

BHAVESH PATEL is an associate principal in the Life Sciences Practice at CRA with experience in a range of therapy areas including oncology, cardiovascular disease, diabetes, and rare diseases.