This was part of Technological Innovation in Health Care Delivery

Can Financial Engineering Make Gene and Cell Therapies More Affordable?

Andrew Lo, Massachusetts Institute of Technology (MIT)

Monday, May 15, 2023


Biomedical breakthroughs such as gene and cell therapies are delivering cures to serious illnesses such as spinal muscular atrophy, hemophilia, certain types of blindness, and other previously untreatable conditions. However, they often come with eye-popping price tags, imposing challenges to healthcare insurers and patients. In this talk, Prof. Lo will review these challenges, describe some of the subtleties of the healthcare delivery ecosystem—including drug pricing practices—and propose a solution. Often called the “Netflix” model, the proposal involves allowing healthcare payers to subscribe to the lowest-cost provider of re-insurance for these expensive one-time therapeutics: the drug manufacturer itself. The subscription model for cures is among the most efficient methods of health insurance, and has advantages for all stakeholders, including payers, patients, and drug companies.