Gene Therapy Breakthroughs: Pharmacy's Next Frontier
June 4, 2025
Gene and cell therapies are no longer theoretical breakthroughs or future promises. They are here, transforming how we treat complex and rare diseases. For pharmacy benefit managers, health plans, and policy leaders, these therapies represent both a monumental clinical advancement and a looming financial and operational challenge.
As science pushes forward with precision medicine, stakeholders across the healthcare system must grapple with cost structures, access frameworks, and long-term planning. The implications for managed care and pharmacy benefit design are significant and evolving quickly.
Understanding the Basics: Gene vs. Cell Therapy
Gene and cell therapies are often discussed together but involve different mechanisms of action.
Gene therapy introduces new or modified genetic material into a patient's cells to correct or replace malfunctioning genes. This is usually accomplished through a viral vector that delivers the genetic material into the appropriate cells.
Cell therapy involves the transfer of living cells into a patient. These cells may be sourced from the patient (autologous) or a donor (allogeneic), and are often modified or expanded outside the body before being reintroduced.
These therapies are fundamentally different from traditional pharmaceuticals. Rather than managing symptoms or slowing disease progression, many gene and cell therapies offer the potential for one-time treatments that provide long-lasting, possibly curative, outcomes.¹
Recent Advances and Approvals
The last decade has seen unprecedented progress in gene and cell therapy. Key drivers include the development of gene-editing tools such as CRISPR-Cas9, innovations in viral vectors like REVeRT (reconstitution via mRNA trans-splicing), and the emergence of targeted cell therapies such as CAR-T.²
These breakthroughs have led to a growing list of FDA-approved therapies. Indications range from inherited blood disorders such as sickle cell disease and hemophilia, to cancers, muscular dystrophy, and rare neurological conditions. In March 2025, the FDA approved several new treatments, including Encelto (revakinagene taroretcel-lwey), an encapsulated, allogeneic gene therapy designed to treat ALS. The development pipeline is robust, with hundreds of therapies in various stages of clinical development.³
The Cost Challenge: Innovation Comes at a Price
Despite their promise, gene and cell therapies carry staggering costs. Treatment prices typically start around $400,000 and can exceed $4 million. For instance, newly approved gene therapies for hemophilia B are priced above $3 million, and others have climbed as high as $4.25 million.³
The economics behind these figures are complex. Manufacturing processes are intricate, the patient populations are small, and clinical trials are expensive. The resulting price tags are difficult for health plans to absorb, especially when the treatment outcomes may take years to fully measure.
Moreover, traditional pharmacy reimbursement models are not designed to handle one-time curative therapies. These therapies challenge short-term budgeting and can result in significant financial exposure for payers who may not retain the member long enough to see the cost offset through avoided medical events.
One often-overlooked challenge is member turnover. A study published in JAMA Network Open found that approximately 15 to 20 percent of commercially insured individuals switch health plans each year.⁴ For therapies designed to deliver value over a lifetime, this creates a disconnect between the payer funding the therapy and the payer who benefits from its long-term impact.
A Path Forward: Outcomes-Based Agreements
To address the tension between innovation and affordability, many stakeholders are exploring outcomes-based agreements. These contracts link reimbursement to real-world patient outcomes. If the therapy does not meet agreed-upon performance metrics, the manufacturer provides a rebate or cost-sharing arrangement to the payer.
A recent example is Bluebird Bio’s partnership with Michigan Medicaid for Lyfgenia®, a gene therapy for sickle cell disease. Under the agreement, the manufacturer shares costs related to hospitalizations from vaso-occlusive episodes for up to three years after treatment.⁵ This is one of the first large-scale public payer initiatives that attempts to align pricing with long-term value, and more than half of U.S. states have opted into the agreement under the CMS Cell and Gene Therapy Access Model.³,⁵
These agreements mark a significant shift. They show a willingness from manufacturers to share risk and acknowledge payer concerns about long-term sustainability. However, outcomes-based contracting is not without hurdles. It requires robust data collection, clear clinical endpoints, and transparency between all parties. Scaling these agreements will require operational alignment and regulatory flexibility.
The Expanding Pipeline: What to Expect in 2025 and Beyond
The pipeline for gene and cell therapies continues to grow. As of early 2025, there are more than 2,000 therapies in development globally. At least 35 of these are in Phase 3 clinical trials, and six are in preregistration in the United States.³
Approximately 54 percent of the pipeline is focused on oncology. The remaining therapies target rare diseases and conditions affecting fewer than 200,000 people in the U.S., including neurological, metabolic, hematologic, and musculoskeletal disorders.³,⁶
Data readouts, regulatory reviews, and label expansion decisions are expected throughout the year. This rapid pace of innovation reinforces the need for pharmacy benefit strategies that can evolve just as quickly.
Strategic Implications for Pharmacy Benefit Management
For PBMs and managed care organizations, this is a pivotal moment. Several strategic actions are needed to ensure financial sustainability and patient access:
- Develop risk-sharing frameworks that align payments with long-term outcomes.
- Integrate genomic data and clinical analytics to better identify eligible patients and predict treatment response.
- Collaborate with manufacturers and regulators to standardize data reporting, define outcomes, and streamline contract negotiations.
- Explore third-party risk arrangements such as reinsurance pools or gene therapy carve-outs to mitigate short-term financial exposure.
The traditional tools of utilization management and prior authorization will not be sufficient. New models that account for the unique nature of these therapies are essential.
Looking Ahead: Opportunity with Caution
Gene and cell therapies are ushering in a new era of precision medicine. They offer hope for patients who previously had limited or no treatment options. But enthusiasm must be balanced with pragmatism. Access will depend not just on clinical success, but on thoughtful benefit design, innovative reimbursement models, and cross-sector collaboration.
The next five years will be critical. Stakeholders who invest in infrastructure today—data systems, value-based frameworks, and educational outreach—will be better positioned to lead tomorrow.
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References:
- American Society of Gene and Cell Therapy. Gene and Cell Therapy FAQs. https://asgct.org/education/more-resources/gene-and-cell-therapy-faqs. Accessed March 7, 2024.
- News Medical. Gene therapy breakthrough: Scientists develop method to deliver larger genes to target cells. https://www.news-medical.net/news/20231024/Gene-therapy-breakthrough-Scientists-develop-method-to-deliver-larger-genes-to-target-cells.aspx. Published October 24, 2023. Accessed March 8, 2024.
- Mass General Brigham. Gene and Cell Therapy Researchers Present Key Findings from Multiple Innovative Studies at ASGCT 2025. https://www.massgeneralbrigham.org/en/about/newsroom/press-releases/gene-and-cell-therapy-researchers-present-key-findings-asgct-2025. Published May 12, 2025.
- Fang H, Frean M, Sylwestrzak G, Ukert B. Trends in Disenrollment and Reenrollment Within US Commercial Health Insurance Plans, 2006-2018. JAMA Netw Open. 2022;5(2):e220320. https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2789399
- Bluebird Bio. Press Release: First Outcomes-Based Agreement with Medicaid. https://investor.bluebirdbio.com/news-releases/news-release-details/bluebird-bio-announces-first-outcomes-based-agreement-medicaid. Published March 11, 2024. Accessed May 14, 2024.
- U.S. Food and Drug Administration. Approved Cellular and Gene Therapy Products. https://www.fda.gov/vaccines-blood-biologics/cellular-gene-therapy-products/approved-cellular-and-gene-therapy-products. Updated March 6, 2025.
