How do we put a price on a cure?

Gene therapy has been the subject of research for decades, but with several gene therapies now approved and many more in clinical trials, we are starting to see potentially curative treatments being a real option in many diseases that previously offered no hope of full recovery or substantial improvement¹.

Researchers predict that by 2036, genetic therapies will be the standard of care for rare genetic diseases². However, the advent of these therapies available for prescription, whilst an impressive breakthrough for science and a renewed hope for patients and their families, presents a number of pricing dilemmas which could lead to these innovative medicines being inaccessible for many patients. One analysis by the Institute for Clinical and Economic Review (ICER) stated that the average price for gene therapy ranges between $1 million and $2 million per dose³. Zolgensma, a gene therapy for treating children with Spinal Muscular Atrophy, has been characterised as the ‘most expensive drug ever’ with a price-tag of $2.48 million per dose in certain markets. However, it offers life-changing results for babies and young children who previously had a life expectancy of only two years⁴. This raises the question of how we should set the price of these therapies. Are high prices justified given the sizeable investment into their development and life-changing effects, and if not, how should vital research into life-changing treatments be paid for?

Costs vs profits  

Pharmaceutical companies invest billions of dollars into R&D, clinical trials and regulatory approval, and production requires specialist equipment and expensive viral vectors⁵. Over time, manufacturing processes become optimised, and costs usually decline, but the level of investment and the length of time before the investment can be recouped plus shareholder pressure are all significant factors in the pricing of medicines. The process of getting a drug to market is also extremely risky: only 13.8% of therapeutics which enter phase 1 of the approval process go on to complete phases 2 and 3 and are approved by the FDA, meaning that pricing of successful medicines needs to in part contribute to other R&D losses and failed trials⁶. Furthermore, patent-wars contribute to elevating prices. For example, the Broad Institute owns the patent to use CRISPR/Cas9 as a human cell editor in the United States and licences it to pharmaceutical companies, resulting in additional costs for those using CRISPR/Cas9 technology⁷. As a result of all of these factors, the pricing of innovative medicines is extremely complex and has to cover extensive outgoings. Already, these pricing pressures are having an effect on the viability of research. Overall investment in gene therapies dropped from $8.2 billion in 2021 to $1.4 billion in 2024, with companies including Pfizer leaving the sector in favour of quicker returns^8.To maintain these life-changing treatments, it is crucial this sector remains financially viable.

So, are these high prices justified?

Long-term value of gene therapies

If you consider the potential of gene therapies to replace a lifetime of expensive treatments, they could even be considered good value, potentially saving the healthcare system money in the long-term. For instance, Roctavian™, an investigational gene therapy for patients with factor VIII (FVIII) hemophilia A is listed on US markets for $2.9 million per patient⁹. The US-based ICER estimated the average lifetime costs for patients with factor VIII (FVIII) hemophilia A (who develop inhibitors) to be between $15 million and $100 million¹⁰, more than 5 times (and up to 30 times) the estimated lifetime cost of Roctavian. Not only this, Roctavian would significantly enhance quality of life.

Exploring innovative pricing frameworks

Insurers and manufacturers are navigating the dilemmas presented by this new era of curative treatments by experimenting with alternative pricing frameworks to find ways to maintain investment, whilst also ensuring that patients can get access to life-changing therapies.

A crucial issue with gene therapy is the uncertainty of treatment effectiveness. Effectiveness varies among patients for several reasons, and long-lasting results are not guaranteed. One approach to address this variation is to implement performance-based instalment payments. However, this raises difficult questions: how do we define success and how do we put a price on varied outcomes of treatment? Is partial improvement worth half the cost of a cure, and how would this be quantified?¹¹

The manufacturers of Roctavian™ have introduced an outcomes-based warranty to all U.S. insurers, providing partial refunds for up to four years if a patient stops responding to treatment, with refunds reaching up to 100% of the total cost¹¹. However, the refund may not fully cover costs associated with treatment failure and additional expenses¹¹. Should a patient who receives no benefits from gene therapy pay anything at all for the failed treatment, considering they may return to paying for a previous treatment plan?

Other solutions under review include government-investment schemes in exchange for affordability commitments, subscription models and pricing tailored to a country’s ability to pay ¹¹.

Unequal access to life-saving therapies

Even with the introduction of new pricing frameworks, the high cost of developing gene therapies is likely to have broader implications, contributing to the existing imbalances in access to healthcare. Those in higher income countries (HICs) will be more likely to be able to afford these medicines than those in low to middle income countries (LMICs), due to high drug prices, limited regulatory capacity and lack of suitable infrastructure ^12,13. This disparity is further exacerbated by the fact that to date, clinical trials evaluating the safety and efficacy of gene therapy treatments have been concentrated in high-income countries¹² and therefore do not accurately represent populations from LMICs countries. Despite this, many of these treatments are highly relevant to LMICs; for instance, sickle cell anaemia (SCA) is highly prevalent in LMICs. Worldwide, over 5 million people with SCA reside in Africa and 1 million in India, whilst ~140,000 live in the US and Europe¹². Yet most gene therapy trials targeting SCA are concentrated in Europe and the US, with no open clinical trials listed in Africa or India¹². Furthermore, although over 2000 gene therapies were undergoing development globally in 2022, fewer than five clinical trials were conducted in Africa, marking a large gap in relevant health data and the ongoing barriers to healthcare¹³. Even within HICs, there persists an inequality in accessing gene therapies, as these treatments are often not covered by insurance, leaving them available to only the wealthiest patients.

Conclusion

Gene therapy offers extraordinary potential for millions of patients, provided we can determine an economical and sustainable way to price them. Optimisation will be key to lowering costs but most significantly, the solution likely lies with an innovative pricing framework that balances risk, outcome and long-term sustainability for both healthcare systems and manufacturers. Without this, we risk sidelining some of the most transformative medical advances of our time.

By Philippa Rolfe

References

¹Wong, C. L. (2023). The estimated annual financial impact of gene therapy in the United States. Gene Therapy volume 30.

²Braga LAM, C. F. (2022). Future of genetic therapies for rare genetic diseases: what to expect for the next 15 years? . Ther Adv Rare Dis.

³Cell and Gene Therapy Manufacturing Costs Limiting Access. (2023). Retrieved from Genetic Engineering and Biotechnology News: https://www.genengnews.com/insights/cell-and-gene-therapy-manufacturing-costs-limiting-access/

⁴Ellyatt, H. (2021). The UK’s National Health Service just approved a drug that costs nearly $2.5 million a dose. Retrieved from CNBC:https://www.cnbc.com/2021/03/08/nhs-approved-a-drug-that-costs-2point5-million.html

⁵Chi Heem Wong, D. L. (2023). The estimated annual financial impact of gene therapy in the United States. Gene Therapy volume 30.

⁶Chi Heem Wong, K. W. (2019). Estimation of clinical trial success rates and related parameters. Biostatistics, Volume 20, Issue 2.

⁷Jon Rueda, Í. d. (2024). Affordable Pricing of CRISPR Treatments is a Pressing Ethical Imperative. The CRISPR Journal.

⁸Beasley, D. (2025). Gene therapy loses luster as investors eye quicker returns from weight-loss drugs. Retrieved from Reuters: https://www.reuters.com/business/healthcare-pharmaceuticals/gene-therapy-loses-luster-investors-eye-quicker-returns-weight-loss-drugs-2025-03-21/

⁹Gomes, N. (2023). US FDA approves BioMarin's gene therapy for hemophilia A. Retrieved from Reuters: https://www.reuters.com/business/healthcare-pharmaceuticals/us-fda-approves-biomarins-gene-therapy-hemophilia-2023-06-29/

¹⁰Louis P Garrison, B. J. (2021). Gene therapy may not be as expensive as people think: challenges in assessing the value of single and short-term therapies. J Manag Care Spec Pharm.

¹¹Sharon Phares, M. T. (n.d.). Managing the challenges of paying for gene therapy: strategies for market action and policy reform in the United States. J Comp Eff Res, 2024.

¹²Cornetta K, B. M. (2022). Gene therapy access: Global challenges, opportunities, and views from Brazil, South Africa, and India. Mol Ther.

¹³Olaghere J, W. D.-U. (2025). Scientific Advancements in Gene Therapies: Opportunities for Global Regulatory Convergence. Foundation For The Fda.