On January 30, 2024, the CMS Innovation Center (CMMI) announced the release details of the Cell and Gene Therapy (CGT) Access Model with an overview fact sheet and corresponding FAQ. The CGT Access Model will test outcomes-based agreements (OBAs) for gene therapies in severe sickle cell disease (SCD). This voluntary model will be on a rolling start beginning January 2025. SCD is a genetic blood disorder that affects 100,000+ people in the U.S. The model population is Medicaid beneficiaries for whom Medicaid is the primary payer and Medicaid expansion Children’s Health Insurance Program (CHIP) beneficiaries (“Title XIX beneficiaries”) in fee-for-service and Medicaid managed care. 

While the details released today pertain to gene therapy in SCD, CMMI leaves the door open for additional therapies and indications to be added in the future, which would need to be applied for separately.  

Background 

The CGT Access Model was initially announced in February 2023 as one of three new models for testing by the CMS Innovation Center as part of the Health and Human Services (HHS) Secretary’s response to President Biden’s Executive Order “Lowering Prescription Drug Costs for Americans.”  

An estimated 50 percent to 60 percent of people living with sickle cell disease are enrolled in Medicaid. Hospitalizations and other health episodes related to SCD cost the health system nearly $3 billion per year. Gene therapies for the treatment of SCD, as well as other complex conditions, hold significant potential to improve patient outcomes and therefore reduce long-term health spending, but they can also pose challenges to state budgets due to the high cost of the therapy.  

Model Details  

The CGT Access Model is a voluntary model whose participants will include both individual states and manufacturers with FDA approved gene therapy products. Importantly, the model will include coverage of a defined scope of fertility preservation services and supports for ancillary services, including travel expenses, case management, and behavioral health services. 

States will be able to express their intent to participate by submitting a Letter of Intent (LOI) by April 2024. States may then apply to the model by responding to a Request for Applications (RFA) by February 2025. After states sign an agreement with CMS, states may begin participation in the model between January 2025 and January 2026.  

Manufacturers will be able to apply to the model by responding to a RFA by May 2024. Manufacturers who participate in the Medicaid Drug Rebate Program (MDRP) and market U.S. Food & Drug Administration (FDA)-approved or -licensed gene therapies for the treatment of severe SCD are eligible to participate in the model. Negotiations between CMS and manufacturers are scheduled to take place between May – November 2024. Providers will not be participants in the model. 

Under the model, CMS will negotiate an OBA with participating manufacturers, which will tie pricing for SCD gene therapy to whether the therapy improves health outcomes for patients with Medicaid over a period of time. CMS will establish financial and clinical outcome measures, reconciling data, and evaluating results; under the model, if the gene therapy is less successful at improving health outcomes than expected, the drug manufacturer will reimburse the health care payer (state Medicaid agency) some portion, to be determined, of what was paid for the therapy.  

The model will allow CMS to bring states together and negotiate on a multi-state basis. Agreements will include price concessions such as volume-based rebates or guaranteed rebates. Negotiations will also include additional pricing rebates and a standardized access policy. Participating states will then decide whether to enter into an agreement with manufacturers based on the negotiated terms and offer the agreed-upon standard access policy in exchange for rebates as negotiated by CMS. 

CMS and states will have an arrangement in which:  

States will provide data to CMS. CMS will use submitted claims data in the Transformed Medicaid Statistical Information System for model operations and analysis.  
CMS will provide states with optional funding to support activities that promote equitable access to care.  
States will be responsible for the cost of the cell and gene therapy, but at a discounted price tied to specific outcomes, as negotiated by CMS. 

The contract between states and manufacturers, with key terms as negotiated by CMS on behalf of states, will be structured as a supplemental rebate agreement. States and manufacturers will have the option to include separate CHIP programs that will be subject to different considerations. Within this agreement, manufacturers will be obligated to provide states with supplemental rebates that reflect model-negotiated terms (i.e., pricing, access standards, outcomes). In turn, states will be obligated to implement an agreed upon standard access policy. 

The performance period of the model will include the OBA term, the measurement period, and a reconciliation period. If, for example, the length of the OBA term is six years (i.e., covering patients who receive the therapy from 2025-2030), the measurement period is three years, and the reconciliation period is two years, then the model performance period would be 11 years. In this example, the first evaluation results would be published in 2027 and the final evaluation report would be published in 2035. 

ADVI will continue monitoring developments and the next steps. This is a delayed release. ADVI Instant content is distributed in real-time for retainer clients. Get in touch to learn more about how we can support your commercialization, market access, and policy needs.