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Darwin's Medicine blog

Professor Brian D Smith is an authority on the pharmaceutical industry and works at SDA Bocconi University and Hertfordshire Business School.

Gene Genie

Evolution will find new markets for gene and cell therapies

Evolutionary scientists are fond of quoting Orgel’s second law: ‘Evolution is cleverer than you are.’ It was coined by biochemist Leslie Orgel to describe how evolution stumbles on in its irrational way, eventually, towards solutions that we rational humans might never find. Nature is replete with examples of this but Orgel’s wisdom also applies to life sciences markets. Bear with me while I ramble into the science before returning to the practical implications.

When faced with a problem, evolution doesn’t plan. Instead, it generates a million answers until it finds one that is marginally better than the present solution. Then it varies that improved answer until it finds another step forward, and so on. If you read Richard Dawkins’ ‘The Greatest Show on Earth’, you will find a treasure trove of examples, from how the eye developed to how spiders design webs. The evolutionary process is fantastically wasteful – far more species have arisen and become extinct than are alive today – but it gets there in the end. That’s really what Orgel meant when he coined his slightly facetious law.

I like to think of Orgel’s law when I see something happening in the life sciences market that seems an intractable problem. Or at least a problem that’s intractable to my rigid, trained scientific mind. I was reminded of just such a puzzle recently when reading about how NICE, ICER and CADTH (their Canadian cousin) are cooperating on a project called ‘Valuing a Cure’. This aims to find novel, more valid ways of valuing very expensive cell and gene therapies.

It’s laudable that these three bodies are looking at this. There’s a strong argument to be made that current economic assessment models are inappropriate for these novel therapies. Leaving aside their cost, their effectiveness, risk and ancillary considerations make them very different beasts. As that tripartite HTA project suggests, we haven’t figured out how to put
a price on these amazing new treatments.

But I’m interested in a wider view of this issue. Can these very expensive treatments ever be affordable, even if HTAs pronounce them as good value? Imagine a thought experiment in which every current and imminent biologic, immunotherapy, rare disease treatment, cell and gene therapy and other advanced new medical technologies was proven to deliver, say £100,000 a quality-adjusted life year (QALY). This would, by current standards, be a great value claim for many new products – better than they can currently substantiate.

Then, in the second stage of our thought experiment, consider what governments would do. The demand would be enormous but even a back of the envelope calculation would reveal that most governments, even rich ones, can’t afford that. It’s a bit like offering me a Ferrari. I’d love one, I think they are great value. I just don’t have that sort of cash to buy one each for my family of five. And even if I did, there are school fees to pay, an extension to build and so on.

So will these advanced therapies ever find a market? Some rational thinkers call for expanding health budgets, either by cutting other (unspecified) costs or increasing taxes significantly. Others optimistically predict a kind of Moore’s law to bring down the prices of these superb technologies.

Personally, I’m sceptical of any combination of these providing the sort of market that the inventors of expensive therapies hope for and, they argue, require. I find it hard to imagine a time when the NHS will cough up £100,000 per QALY for anything other than socially exceptional cases.

But evolution is extremely clever, as the spider web in the corner of my office reminds me. Look carefully and we can see it working. In Poland, new grandparents are buying vaccines instead of silver gifts. Health tourism is booming. Everywhere, affluent but not wealthy patients are paying for non-reimbursed blood sugar monitoring systems and aesthetically pleasing prosthetics. That’s where the money lies, so that’s where evolution will lead the business models of cell and gene therapies.

Of course, it sounds fanciable to think of an ordinary person spending hundreds of thousands on a medicine, without government support. But try another thought experiment. If your nearest and dearest was dying and the Gene Genie popped up, offering a cure for, say, half a million, would you find it? For many, the house would be on the market in a moment. And then, if Moore’s law and competition drives the treatment cost down, technology improves the outcome and financial service firms develop new models of funding private treatment, cell and gene therapy become a modern version of a luxury cruise: once the reserve of the few, now the choice of the many.

In innovative companies, the wheels are already turning. Roche has opened Herceptin markets in China by working with insurance companies. They are clever to do so. But not as clever as evolution.

Article by
Professor Brian D Smith

Professor Brian D Smith is a world-recognised authority on the evolution of the life sciences industry. He welcomes comments and questions at brian.smith@pragmedic.com

4th March 2019

From: Healthcare

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