Q&A on AMCs getting into the gene therapy space

Gerald McDougall, PwC partner:

It’s an exciting time. We’re talking about curative therapies. Gene therapy isn’t necessarily new – it’s been around for two or three decades, and academic medical centers with large research portfolios have been at the forefront. But now that it’s coming to the point where these therapies are getting approved and reaching the clinic at scale, I think there’s tremendous excitement associated with the promise of what gene therapies could achieve.

There are lots of challenges ahead, but I think there’s tremendous momentum as well. And there is and has always been a moral imperative to be able to have patients have access to these curative therapies. There’s this convergence between innovation entrepreneurship with the biomedical research side and the clinical application. The challenge is how to deliver this complex care at scale and at a price point that makes sense for the payers and reimbursement system that we have.

HRI: Is there a revenue component to this as well? Some academic medical centers and hospitals are facing tighter margins and could be looking for ways to generate new revenue.

Gerald McDougall: I think everyone’s asking that question right now. Hospitals can benefit from very lucrative medical revenues from gene therapies, but they’ll need to build clinical capabilities to do so first. Right now the early gene therapies are for the most part for very small indications and rare diseases. This isn’t a volume play for hospitals right now. But that could eventually change as more gene therapies enter the pipeline.

HRI: Could this model eventually expand to larger nonacademic medical center hospitals or general hospitals?

Gerald McDougall: I think it already has. We have many clients that are perhaps not academic medical centers, but they are innovative clinical delivery systems of excellence. They are immediate adopters of innovation. And I think for gene therapies, the adoption curve is going to be much faster thanks to how transformative these therapies are for the clinical standard of care.

HRI: What are some of the ways that hospitals can compete in this space? What are some of the core competencies that are going to be necessary for hospitals to even engage in this market?

Gerald McDougall: I imagine any organization that has the ability to conduct transplants across different disease categories can quickly figure out how to do gene therapies. I think the other piece of this is that if you’re going to participate early in the gene therapy space, you’re going to want to think about participating in clinical trials for gene therapies.

A lot of organizations, particularly integrated delivery systems, may not have the capabilities to participate in phase 1 trials. They need to think through the ability to do clinical trials matching or have the capability to do predictive analytics about whether they have the patients. Because even if you have the therapy, if you don’t have access to a pool of patients with a disease, it’s not going to work.

Another competency is regulatory affairs. In theory it’s not much different from doing compliance in a research setting, but the bar is much higher. Not only do they need to capture consent, but they also need to track patients longitudinally after treatment and, if they’re looking to develop this themselves, learn how to submit the therapy to the FDA.