LIVE from RiskNavigator 2026

Announcer

And now live from the BCS Financial Risk Navigator Conference in Chicago, Illinois. It’s the Firm and Final podcast. Please welcome your host, Mehb Khoja.

Mehb Khoja

All right. So that feels like a lot of pressure that we have to live up to now with that really nice intro. So first off, thank you to everybody who is here for our conference. And thank you to all the production folks that put this together.

Today’s been a day that we’ve been talking a lot about the intersection of drugs and high cost claims.

And so I’m really thrilled to have this panel conversation today. And everybody up here works in some form or fashion around high dollar drugs. And I thought a good way to get us started is maybe just introduce yourself, tell us what part of the pharmacy value chain you work in. And let’s start with you, Pat.

Pat Gleason

Sure, thanks Mehb.

Pat Gleason, I work at Blue Cross… well Prime Therapeutics, which is owned by Blue Cross Blue Shield, I’m in the Blue Cross Blue Shield Plans.

I do a number of things at Prime, including forecasting gene therapy members and their utilization, providing that feature as reporting for clients and self-insured employers. Value based contracting with pharmaceutical manufacturers for the remuneration of their therapies when they don’t work and they don’t deliver on the outcomes, not the rebate side of things but for the clinical outcomes. And then do real world evidence generation for helping making decisions around utilization management, prior auth, step therapy, and formulary placement.

Mehb Khoja

Okay. Jim?

Jim Clement

Thanks Mehb. Jim Clement with Synergie Medication Collective. We are owned by the Blues, the Plans across the United States, and we represent about 98 million Blues lives.

Synergie’s role in the marketplace and the Blue ecosystem is really to lower medical drug spend, but also to optimize the pharmacy supply chain, whether that be specialty pharmacy, retail or mail. We concentrate a lot on value based contracts as well in the cell and gene space, as well as oncology and rare disease.

We focus more on the medical side of the house.

Mehb Khoja

Ramesh.

Ramesh Jayasuriya

Hey good afternoon. Ramesh Jayasuriya, I represent Evio.

Evio is a pharmacy services company owned by six large Blue Cross Blue Shield Plans. We only really have one focus area, and that’s really all about making high cost medications affordable. Quite fitting given the conversation today.

We do that through essentially three primary strategies. We have a large longitudinal data asset as well as analytics and talent we’ve gathered that essentially mines that data set to identify insights and action you can take to figure out the right medication for the right patient.

The second lever is really around innovative contracting. So think beyond rebates. So a concept like direct purchasing where we essentially mitigate all the sort of the intermediaries in between a manufacturer and a patient and essentially extract that value and hands that value to a plan so you could make that medication more affordable.

And the last piece is really about a set of digital assets that underpin all these things that we do that enable us to be efficient and effective.

Mehb Khoja

Awesome. Ashley.

Ashley Hume

Awesome. I’m Ashley Hume, I’m the CEO at Emerging Therapy Solutions. We’re mostly known as ETS in the market and our company works on high cost, low frequency claims. So transplants and cell and gene therapies primarily.

We do that in a couple of ways. We have a predictive analytics tool where we’re mining down to the individual member level and segmenting people into high, medium and low risk for receiving a cell or gene therapy.

And then we are proactively outreaching if the payer or employer chooses to turn that particular feature on, but to get them navigated to the highest value center.

We have contracts in place at about 180 centers across the country. And we also have URAC accredited UM and CM and so we’re able to really manage kind of start to finish the entire episode of care for cell and gene therapy.

So we essentially spend a lot of time thinking about how to manage these $3 million claims before they become a $3 million claim.

Mehb Khoja

Awesome. So I’m always interested in how people got into their career.

And so I’ll just give you my background as to how I started working in high dollar pharmacy. I’m an actuary by background. I started my career on the employee benefit side. Employee benefit customers needed stop loss coverage, and so we were helping employers make decisions around that product.

Over the course of time, it just seemed like pharmacy became a larger part of stop loss reimbursements and eventually reinsurance reimbursements. And that’s how I started focusing on high dollar pharmacy.

Ashley, how did you get involved in this industry and specifically in cell and gene?

Ashley Hume

So I can credit our founder, Dave McLean. And he was the founder of URN back in the early 90s, United Resource Networks, which became Optum’s Transplant Network that still operates today. I had worked for him at a company called Novel Objects, like back in the mid 2000s, that really worked on high cost specialty drugs, and he called and said, well, you thought that was a wild ride. Wait till you see what’s coming with cell and gene therapy.

So he was the founder of the company and I was the first employee.

And at the time, I mean, I had done a ton of work with just sort of innovative contracting, both on the payer and the provider side over the course of my career. So it was a perfect fit.

And I said, let’s go. And now here we are, almost eight years later, and we’re still finding new ways to tackle these incredibly fast moving, rapidly evolving landscapes with cell and gene.

Mehb Khoja

Ramesh, how about you?

Ramesh Jayasuriya

Sure. Always been attracted to industries and spaces where I can solve problems and create impact. I’ve always been in sort of the intersection of technology and business and spent about 20 years in healthcare. My first ten predominantly, if not exclusively focused on medical side of the equation and then the last ten focused on pharmacy.

And to me, like I keep staying in healthcare because of two things. One, the impact I can create. And the second part is there’s a never ending list of issues and problems to solve. And every time I think I learned something, there’s 100 other things that I had no clue about. That keeps me energized.

Mehb Khoja

All right, Jim, trade relations. What does that mean?

Jim Clement

Yeah. Well, that’s we’re probably on the front end of things. I’ve been in the pharmacy supply chain really my entire career started off in the health systems, but in the health systems, I quickly realized that pharmacy was starting to take a big bite out of the expenditures. And so born and raised in Saint Louis, and so there was a small PBM starting up in Saint Louis and really started to get involved in specialty pharmacy in the early 2000s.

We were going through the make or buy decision when we started buying. And one thing led to another, but I’ve been around the manufacturer negotiation component my entire career.

Mehb Khoja

Okay. And Pat, you actually went to school to be a pharmacist, but you ended up working in insurance. Why the hell did you do that?

Pat Gleason

That’s a great question, Mehb. And actually, I went to pharmacy school and then I decided to go do a residency in pharmacy practice. I went to Pittsburgh to do that, the University of Pittsburgh Medical Center. And during that time there in general internal medicine, seeing how physicians were making decisions and not considering cost, blew my mind, frankly.

And so then I decided I’d do a fellowship in outcomes research to better understand clinical outcomes and cost, the economics of drug therapy and decision making and cost effectiveness assessments, and how to do that real world analysis.

And then went into academia. So I was a professor at Pitt and teaching in general internal medicine, decided I’d go back to where my roots are in Minnesota, did the same thing at the University of Minnesota for a few years, got pulled away at an internet startup company in 2000 that ran out of venture capital. Happy to provide more details, but we don’t have time.

And found my way into Prime Therapeutics which at time was four Blues Plans, Mehb. And employee number 320, 25 years ago. And now we’re 7,000 employees plus and 19 Blue Plans.

And during that time spent formulary development, utilization management, using my skills to identify where we can find more cost effective drug therapy rationale to ensure that members are getting that therapy at the lowest cost and getting the best outcomes, and then along the way, negotiating those value based contracts with pharma just kind of fell into my lap.

So I’m like, why not? Because they’re overpricing their drugs to value.

And then gene therapies came and we got problems of concerns of problem, concern, durability like these drugs are getting gene therapies approved with following patients for two to three years, maybe five. But they’re supposed to be promised as a cure. So that’s a durability question. They’re priced as a cure, but are they?

So let’s contract for outcomes to ensure that we can get value for that high price. And also we need to understand how to pay for them, which is what a lot of what you guys are doing with stop loss and reinsurance. So we need to forecast that. And so I probably talked long enough about my background, but it’s been a fun ride.

And I’m looking forward to continuing working with you all on that.

Mehb Khoja

Well it’s a very diverse background of the panel that we have today. And I think one of the key takeaways from the conversations we’ve had in the conference is that healthcare is becoming unaffordable, and pharmacy and drugs are probably the fastest growing part of that unaffordability. And so whether we’re talking about GLP-1s or gene therapies, how did we get to this place where costs are so high?

And I know I’m starting with the easiest question of the day, but why did we get to this place where the costs are so high?

Jim Clement

I’ll go ahead and take a shot at it. But you know, industry and what I mean by industry Pharma really moved away from that mega blockbuster pill. And moving away from that blockbuster pill, they started to probably because just everything that, you know, Francis Collins did and you know, the DNA and decoding that and what that did is the science really leapfrogged over the last probably 40 or 50 years.

And it allowed pharmaceutical companies to focus on disease states that there just wasn’t any option. But with that came smaller populations.

So in order to make up their R&D cost on a smaller population, the price naturally had to rise. Did it have to rise to the state that it is?

You know, Pat, you said three drugs launched in the last month, the lowest cost of which was $400,000.

Pat Gleason

That was oncology therapies, right, Jim.

Jim Clement

Right. So, you know, that’s how we’re in this place.

Ashley Hume

Well, I think honestly like thinking about CAR-T and we’ve talked a lot about CAR-T today, when CAR-Ts were new and they were refractory cancers, you know, third, fourth line and really, really sick people. So at this point, we’ve paid a ton of money already trying to cure this person. And they were made for that patient.

So it was super unique. It was a really, you know, crazy concept that we were going to create a curative therapy for this particular patient.

And so the price point when CAR-Ts came out doesn’t seem outrageous compared to some of the other drugs that are chronic use drugs and things like that. Well, now as they’re moving up in line of treatment and you’re seeing them at third line, second line someday, first line, somebody said that earlier and it’s likely true.

So when we get to that point and as we get competitive therapies on the market, and then we get to Autologous CAR-T and some of the other types of CAR-Ts that are coming to market, the price point’s been set. And so trying to peel that back every time there’s a new approval, I’m like, is this going to be the one where they decide to be maybe $20 grand under the last one?

And the answer is no, $20 grand over the last one.

Mehb Khoja

Twenty grand over.

Ashley Hume

So it’s certainly a challenge that we’re going to have to continue to pursue solutions for.

Ramesh Jayasuriya

I really like that. I would add that there’s also a system limitation, right. What I mean by that is if you think about whether it’s CAR-T or gene therapy, so anything that’s priced above $750,000 or even million, it’s being pushed through a system that was never architected to handle that. The current system in place for medications, whether it’s, you know, distribution, financing, how we take care of those patients, all was created for much lower costs, lower complex therapies.

And we’re expecting these really high cost therapies to behave the same way.

And it doesn’t. Right. If you think about it from a health plan perspective, financing a curative therapy on paper, even if it works perfectly, which it doesn’t, Pat you’ve got quite a bit about this previously as well. It’s difficult when you factor in things like churn.

So how do you… how do you figure out what happens to that member if they’re cured but they disenroll from your plan and go to another plan? If you have a really good value based contract, maybe you have portability provision so that you’re still covered, even if they go from one carrier to another, but most of them don’t.

So what happens to the way that you finance and sort of the upfront investment you made in keeping that member healthy, which now benefits another carrier, not you.

Mehb Khoja

Yeah, yeah.

Pat Gleason

My two cents on it on how we got here to these very, very expensive therapies are that the manufacturers are beholden to their shareholders. They’re going to price to what the market they believe can bear, and then as they bring these new therapies, for example, a gene therapy for, say, hemophilia, or in the case of Zolgensma for spinal muscular atrophy, there were therapies prior to that that ran in the range of $300,000 to $400,000 annually.

So they’re… then for Spinraza Nusinersen in particular for spinal muscular atrophy. And then you got Zolgensma is $2.5 million price point now came to market $2.1 million.

But they’re justifying that price off of the therapies that they’re going to eliminate as a cost. So you had an annual cost of $300K, ten years that’s $3 million. And they’re saying, look, we’re saving you money. But the hard part was they price theirs off of something that was already overpriced. But that’s where we are.

Mehb Khoja

Yeah, Ramesh, you brought up something that’s interesting. You said like the system wasn’t set up to handle this type of payment structure. And this is going back now about ten years, but a think tank was put together by MIT to bring together experts that were working on cell and gene. And the topic of the cost came up and somebody in the room said, we can charge whatever we want to charge. The reinsurers will pay for all of it.

And somebody said, we should probably get a reinsurer’s perspective. And that’s when I joined that, that workgroup. This is where I met Ashley, and we were starting to talk about how the cost of these things were going to get financed. In 2020, I came to BCS, I met Pat because we were working on a gene therapy solution, and we were just side-barring about this.

But at that time, back in 2019, 2020, everybody was worried about Valrox. Later was named as Roctavian, but at the time, the thought was this was going to be a $4 to $5 million therapy. FDA reasons it got pushed out, it got pushed further and further. And finally, when Roctavian came to market, I think at a price point of $3 to $4 million, it just never had the uptake that all of us were worried about.

Ashley, why did that happen? Why was the uptake not there?

Ashley Hume

Oh, well, I mean, a lot of reasons Mehb. Patient selection, definitely one of them. Whether or not the patients were interested for a variety of reasons, including lifestyle reasons. But in addition to that, I think it is, I mean it was a therapy, the durability did not look spectacular compared to some of the other gene therapies. And you can only get one gene therapy.

So if you can only get one, you probably want to make sure that you’re getting the right one. So maybe you’re going to wait for the second gen or the third gen. But also these are people that have been living their life with hemophilia for a long time. They’re kind of used to it and they just want to maintain their existing lifestyle.

Jim Clement

Well, there was chronic use meds that to your point, that were very good. The patients were comfortable with it.

Mehb Khoja

There are other therapies available to a patient with hemophilia, and they didn’t necessarily need to use the gene therapy, especially since, Ashley, you mentioned a lot of lifestyle changes would need to be made in order to use those therapies.

Ashley Hume

I also think, I mean, it’s a great example and we talk about this all the time, the difference between hemophilia, sickle cell diseases, and metachromatic leukodystrophy, right.

Those are completely different situations. And all of the gene therapies at this point, each one of them has to be managed individually. And the considerations around who the right candidates are, what ramp is going to look like, you know, all of those different considerations are going to be different.

And I’m sure everyone remembers when Elevidys was approved. And it was like a bum rush to get that therapy. I mean, they must have dosed 100 kids in the first three months it was on the market and it’s time sensitive. These are kids with degenerative diseases. They don’t have any other options. Like, yeah, those moms are going to fight like hell to make sure they get coverage for their child.

And now there’s challenges and there’s been restrictions and all sorts of different issues with the FDA. And, I mean, each one of these therapies is going to have its own set of caveats, which is why we have to be super nimble as we are thinking about how we manage them.

Mehb Khoja

Let’s talk about durability, because drugs are made for patient use, but they don’t always work. But in this world where we’re talking about $2 to $4 million claims, $2 to $4 million therapies, what happens if the therapy doesn’t work? Should the payer who paid for that therapy be responsible for the payment?

Pat Gleason

I’m going to short answer that with a strong yes. Yeah, yeah.

Jim Clement

I second that.

Ramesh Jayasuriya

Yeah I think it’s the only equitable way to do it. Right. Because otherwise you create a system where there’s really no sense of accountability. It’s no different than, you know, a lot of us use an iPad or iPhone, and if it’s broken within the first year or some period, you should be able to get your money back so you could get a new product.

And it’s the same equivalent when you’re spending $4 million, because that patient is going to cost a lot of money. And in some of these cases, I think hemophilia is interesting. And, you know, Pat’s way more credible than this. I’m not a clinician. But one of the interesting things is like when you track these patients over time, that’s getting gene therapy, but then also using factor around the same level. Then you go, oh, wait, like patient didn’t get any benefit because they still have to go to their prescriber at some frequency.

The system didn’t get any benefit. The plan didn’t get any benefit. The only party that’s benefiting is the gene therapy manufacturer because they just sold their expensive product.

Ashley Hume

I do, I agree absolutely there needs to be outcomes based agreements and the money should go back to whoever paid. Like it shouldn’t be going back to an ASO. It shouldn’t be going back to a PBM. It should be going back to whoever paid.

And the other piece is and I cannot believe I’m going to say this because I am going to get out the world’s tiniest violins for biotech for a minute here, for a minute.

But there are situations where I don’t know that it makes sense. And I think about things like MLD where you have 20 kids a year getting treated. Their clinical trials were tiny, they’re doing their best, and as long as they can put endpoints in place and they’re hitting the marks that they committed to, it may not work every time. And there’s not a big enough sample where you can really say, okay, well, one of the 20 kids didn’t have an effective outcome, and so you’re going to have to pay that back. I mean, that’s a tough run.

Jim Clement

But that’s exactly why the value based contract is absolutely the price of entry. If a manufacturer is going to pursue that and get approved, somebody mentioned earlier in the conference, you know, approval off of phase 1 or 2 B study, you know, and to your point a trial population of 12. Right.

So and I’m not saying this is wrong necessarily. And the FDA has now the plausible mechanism of action. Right. Which is going to open the funnel even wider.

It’s basically a transference of risk from the manufacturer in funding a larger clinical trial to the marketplace. And the, you know, the regulatory environment has all these and the FDA has all these tailwinds for manufacturers. They received a lot of tailwind to bring that drug to market.

They need to stand behind it.

Ramesh Jayasuriya

Well and there’s systematic tailwinds right. I mean just look at Part D redesign the decent chunk of risk that used to sit on the books of manufacturers that got passed now to plan sponsors.

Pat Gleason

You mean Medicare, Medicare Part D?

Ramesh Jayasuriya

Part D, yeah.

Ashley Hume

I just I hope that we can come up with ways, and just since there’s been so much restructuring in the government and things like that, I hope we can come up with ways, because a lot of this used to come out of NIH when we had these rare disease populations.

So I worry about the rare disease development and how many of those programs are getting cut, and at what point are we going to come up with a way so that we can kind of do both?

Mehb Khoja

So we talked about value based contracts. And I think the challenge in this industry, so this is largely a self-insured and reinsurance industry. Let’s just talk about risk transfer for a second. You have a member who’s getting care. They’re capped at their out of pocket. Then you have the employer who’s kicking in up until like a stop loss deductible. Then you got the stop loss carrier who’s picking up an expense from like their deductible up until a reinsurance limit. And then you ultimately have a reinsurer who’s picking up the lion’s share of this expense.

If you have a value based contract, how do you solve for the fact that there’s multiple payers involved and they’re very much downstream?

Jim Clement

I think that’s a that’s probably a forensic accounting challenge.

Mehb Khoja

Yeah.

Jim Clement

But I think it can be solved. Right. We have to figure out a way to solve it. There’s receipts.

Ashley Hume

Proportionate share.

Ramesh Jayasuriya

I think it goes back to who’s footing the bill. Right. So typically like to me in some ways, at least in current state, value based contracts, they’re themselves some sort of a protection or insurance instrument. Right. You’re protecting yourself against a future risk. And if you think about that funding mechanism, if one party is spending that upfront investment in, typically this requires some real world evidence to figure out the right endpoints.

It requires trade expertise, such as Jim and team like that to go hammer out that agreement and then require somebody to administer. Right. Collect all the data and do that invoicing, audit all of that. So let’s just say for conversation’s sake, for the most part today it tends to be a health plan who’s picking up that tab or a PBM, Pat will pick up the tab.

In those cases, if they’re spending that money up front, well then all the warranty payments will flow to them. But if we can create a construct where that investment gets spread across stop loss, reinsurers, others, then I do think the mechanics are easy, right?

Because to Jim’s point, we already know we can reconcile and say this is exactly attached to this claim. Here are the warranty dollars coming back.

It’s just a matter of figuring out what’s an equitable way to finance it on the front end. Because what you couldn’t have is a system where the health plan or the PBM or some one entity is footing the bill to create that infrastructure and maintain it. And then as soon as the warranty hits, five people put their hand up going, well, I want a piece of that pie.

Mehb Khoja

All right. So I’m thinking about the fact that somebody described cell and gene today as lightning strikes. And if you’re from Chicago, you know it’s been raining a ton this past week. So with lightning comes rain.

Are cell and gene going to be lightning strikes? Or are they going to become the way that medicine is administered?

Jim Clement

I think they’re going to become like days throughout the year the temperature in Texas is over 50. I mean, really it’s not a lightning strike anymore.

Ashley Hume

It’s a benefit category. I mean, it’s going to become like everyone remembers when specialty drug or high cost imaging, like it’s a benefit category. This is the beginning days of a benefit category.

Pat Gleason

I kind of think cell and the BiTEs, I mean, we haven’t said anything about the BiTEs, but if you want to, just whoever wants to pull the phone and Google BiTE, it’s Bispecific T-cell Engager.

You know it’s there can be competitors to the CAR-Ts, and they may be priced maybe half but they’re still over $100K of what a CAR-T is, which is, you know, around $400 -ish right now. The CAR-Ts and BiTEs… that wave is going to hit before the gene in my opinion, and becomes a non-lightning strike, more like rain in your analogy Mehb.

We’re talking 2 to 3 years, probably for the BiTEs and the CAR-Ts to really start to take off. And then the gene therapies I think we’re more like five-ish years out from really tsunami-ish, to grab another word that was used earlier today. That’s what I’m thinking.

Mehb Khoja

Okay. I’m going to shift the conversation a little bit here. And if the audience has questions that they would like to ask of our panel, please get that ready. I’ll maybe ask that after this next question. I heard Dan say we have to talk about AI during every session today. So I’m going to put you guys on the spot to talk about AI.

How are your companies using AI related to the work you’re doing in high dollar drugs? Are you using it for any type of analysis? Are you using it for identification purposes? Ashley, why don’t we start with you?

Ashley Hume

Yeah, we’ve built some internal tools just to monitor, honestly, the news, there’s just so much information every day. So we do have some tools to monitor news and kind of aggregate some of that, especially because we’ve now expanded into having to monitor the international pipeline, because who knows what’s going to happen, how quickly we’re going to be dealing with therapies that are approved in other countries, just with the different approval pathways that are available or in process of development.

With our proactive patient ID program, we don’t use AI. We use algorithms to kind of mine the data. And then once we’ve sort of established here’s the members that truly need review, then those go to a clinician and the clinician does the actual review.

So I think we are definitely using AI for efficiency purposes. But we’ve actually tested our tools against AI just to see how the difference plays out. And it’s super different.

And I think if you were to test, and it’s a fun game and everyone should try it, but if you were to test, you know, the same prompts in Claude and in ChatGPT or whatever other tool of choice you’re using with the same prompts and the same inputs, you’re going to get different answers.

Mehb Khoja

You can’t always trust the answers. Ramesh?

Ramesh Jayasuriya

Sure. I think it’s a fascinating question in that nowadays when people talk about AI, like where mind goes directly is into large language models, right? Claude, OpenAI, etc., etc.

To me, we take a pretty broad view on AI in that there are some sort of really mature technologies that fit under the broader AI bucket, whether it’s robotic process automation or machine learning, that actually, depending on the use case, is better.

So for us, I kind of parse this into two buckets. What do we use in production settings? When I say production settings, these are things that we are using for like live production.

A couple of examples. One is we tend to review a lot of medical policies. Historically, you have a clinician pharmacist that typically has to review it manually. It’s pretty cumbersome.

So that’s an area that we see a huge use for large language models that we use that helps our pharmacists get a ton of efficiency, because it does a lot of the kind of the repetitive work, but there’s always a human in the loop that’s sort of checking and kind of validating that. So that’s one example.

Another one is from a machine learning perspective, we use quite a bit of machine learning in all of our analytical products. And then when you go to non-production environments, that’s where we use it most liberally.

So everything from, gone are the days where like our product people will do prototypes in a Word document or PowerPoint. Now it’s about like build something over a weekend and let’s see how it works, again in a non-production setting.

Mehb Khoja

Okay. Jim?

Jim Clement

Yeah, I would say we’re using it right now. We’re very conservative in our approach with AI at this point in time. We’re a services organization, we’re here to serve our participants, which is the Blue ecosystem. Right now, we’re really focused if we’re using AI, it’s really focused on administrative efficiencies, not necessarily the analytic application just yet.

Mehb Khoja

Okay. How about you Pat?

Pat Gleason

We have a product called High Touch RX at Prime Therapeutics that I’m a business owner for and a clinical owner as well. And that is to provide surveillance of all high cost therapies after that prior auth utilization management and they’ve started on that therapy.

So there’s inevitably drift in some members to a non cost effective regimen. The dose started to escalate, the dose the interval became shorter. Not sure why that’s happening. It just does. Physicians start to do things that are becoming sort of out of bounds and investigational.

So we use AI to help us find that opportunity. And then it’s a pharmacist making a phone call on soft steerage. So it’s like, you know, just help me understand how we got here with this new therapy regimen that you’ve got for our member and your patient.

And by the way, they have out-of-pocket costs and you’re an outlier, you know.

And on top of that we also now scrape every prescribing product information, so the PI that exists out there for anything that we can find for drug-drug interaction, drug condition interaction, dosing reduction that would be result of renal insufficiency, kidney efficiency or hepatic liver.

And then go look against the medical claims for those members. Because we have integrated medical and pharmacy data, that’s the value part of Prime. And working with our Blues Plans and being owned by Blues Plans, sharing of that information on the medical claims so we can find those members that have now developed some kind of kidney or hepatic insufficiency that we can see in the claims. Their dose hasn’t been reduced, and we can have those conversations too.

So we’re using AI in that manner to ensure that members are getting the most cost effective, safe therapy, and we’re saving our plans money and the members money along the way.

Mehb Khoja

Okay. Can we use AI to predict cell and gene patients?

Pat Gleason

Yeah. Yes. The short answer is yes. That’s usually more from a predictive modeling, which is a form of AI, but it’s much more human controlled. It’s not like large language models like Ramesh is talking about, but we do that too. So I left that out, so thanks for prompting me Mehb.

And we’re doing that right now.

So we forecast potential candidates like again integrating medical and pharmacy data, knowing what conditions they have, how they’re utilizing their healthcare, the visits and the drug therapies that they’re getting to say, okay, you have sickle cell and you’re also getting this number of infusions and you’ve got iron overload.

You probably are a good candidate for a gene therapy to treat that. And you should get it.

And we have, to be frank, we have a lot of underused, those sickle cell gene therapies are great and we only have less than 5% of people that have been treated with a gene therapy for sickle cell.

Mehb Khoja

So there’s more coming.

Pat Gleason

There’s more coming. And it has a lot to do with the economic status of those individuals also and the systems that we have in America. But we could do better with sickle cell treatment and beta thalassemia, for that matter, too.

Ashley Hume

And one other point on that, because we’ve had similar experience, like once you find the people that are great candidates, next step kind of back to human in the loop. Talk to the patient. Because what we found is once we outreach and the navigators kind of start having those conversations, a lot of the patients are like, nope, I’m not doing it. At least not this year or next year.

Some people say I’m not doing it ever. I’m never going to have the bandwidth to leave my family for two months and go receive a gene therapy.

So I think it’s additional insight, but you get so much more refined once you go through those exercises to get down to your populations.

Pat Gleason

Yeah, just to build upon that for a second, think about sickle cell and beta thalassemia. It’s an African-American population… those are the individuals because of their genes that they’re the ones that have this disease. They’re lower in the socioeconomic status.

To your point, the treatment isn’t just the gene therapy. They have to be pretreated as if they’re going through a bone marrow transplant with busulfan and that busulfan if you’re a woman can lead to infertility on top of it all, you know.

So if the family is dependent upon the individual having two jobs and one of those are McDonald’s and trying to go tell the employer that I need to go take two months off to go get treated…

Ashley Hume

You need daycare.

Pat Gleason

It’s just it’s not going to, we need a better-

Mehb Khoja

They’re not going to get the treatment.

Pat Gleason

In America we got to do better. So we’ll stop there. But that’s why we aren’t seeing when we like forecast and look at candidates like, okay, yeah, we’ve got these 100 people. We’ve got probably 200, 300 in our book of 17 million commercially-insured that look like they’re great candidates for sickle cell treatment with a gene therapy or beta thalassemia. And we have less than three that have been treated.

Ashley Hume

And we talked to a sample of ten and had two that said they were interested.

Mehb Khoja

Wow.

Ashley Hume

When we actually spoke with the patient.

Mehb Khoja

I’d like to open it up to the audience to see if anybody has questions for our panel.

Mike

So if you had a magic wand, how do you fix this? The problem in America with drug costs?

Mehb Khoja

It’s a very tough question because you have a country full of capitalists that are working in different parts of the healthcare system, which happens to be extremely disparate. And so I don’t have the answer for you, Mike, I just know that each of us has to do our part, and we all have to work together, because at the end of the day, all of us have family, friends, loved ones that have these issues. And so it becomes incumbent upon all of us to work together to lower the cost, make it more affordable for everybody.

Pat Gleason

The Europeans do have a system where they require an economic review in most countries to justify the price. The manufacturers have to show their data, show where they’re going to get offsets on the medical side, and or caregiving and other social economic factors, and provide those economic models to policymakers that are government employees.

And that price, especially through NICE in the UK, for example, is a threshold. And if the manufacturer won’t come under that threshold, then their drug isn’t allowed on the market.

So to Mehb’s point, I mean, if we’re a capitalist economy in the US, I don’t know if it’ll ever fly, but we do have an entity called the Institute for Clinical and Economic Review, or ICER. They’re nonprofit, they do economic modeling, and they set out for a lot of these very expensive therapies, make a statement about what a fair price would be. And that’s at an investment of $150,000 a year, per quality adjusted life year gained, to get into some detail.

But point being, almost all branded drugs are overpriced to value and should have a lower price. And that’s at an investment, that’s not like a cost neutrality to medical offset or caregiving value. That’s still an investment of $150,000 a year.

And, like I say, most drugs are overpriced to value.

Ramesh Jayasuriya

I love that .I think I would add one more component because I agree with you Pat, but one part is figuring out that price to value equation, which is so important.

I think the other part in the US, especially if we narrow in on the kind of the drug value chain, there’s so many intermediaries that are incentivized from an economic standpoint based on the unit price. So they kind of get paid a percentage of the VAC or AWP or ASP, one of those units that are all the unit price.

And when you do that, it creates perverse incentives. So if you can de-link how you compensate different actors in this ecosystem and pay a fair and transparent price and when they do better, pay them additional incentives, when they don’t do well, hold them accountable. That could be another powerful lever to kind of extract value out of the system that’s now being trapped by intermediaries.

Mehb Khoja

Okay, why don’t we wrap up with one last question, and we have brokers in the room who represent employers. We have health plans. What’s one piece of advice from where you sit in the pharmacy value chain? What’s one piece of advice that you can leave the audience with as a takeaway? A method to keep the costs as low as possible because we’re all after healthcare affordability. Pat, why don’t we start with you?

Pat Gleason

I heard really good conversations earlier today around ensuring that you’re looking at your data, you’re understanding in particular, it sounds simple, but the unit price right? And ensuring that the unit price isn’t marked up beyond a fair price.

So there’s some conversations around site of care and you know, if the drug is billed and priced through the medical benefit, it’s got one price for the exact same drug and unit. Yet on the pharmacy benefit is substantially lower.

Or if it’s on the medical benefit, if it’s an outpatient clinic versus the inpatient clinic, you know, so taking the time to understand what you’re getting billed at and knowing what your right fee schedule should be for your unit price of that given drug, that’s going to be a smart thing to do.

Mehb Khoja

Okay, Jim?

Jim Clement

Yeah, I mean it extends off of that as well the earlier conversation, it’s you know, we have the data, use it. Whether you’re a health plan or a reinsurer. The data is there. Don’t leave excess funds on the table or paint it out when there’s alternatives that are 25% cheaper.

You just can’t. We can’t do that.

Mehb Khoja

Ramesh?

Ramesh Jayasuriya

Yeah I mean there’s a lot of actuaries and finance people in the room, so this phrase will resonate with you when I think about this sort of really high cost claim, especially cell and gene, I think about black swan events in finance where it’s typically really easy in the retrospective to predict those, but it’s very hard to do that proactively.

So you have to have mechanisms to sort of go upstream and figure out how you can reduce your risk as much as possible.

So to me, the big takeaway is how do you go upstream? How do you figure out the patients and the cases that need attention well before the claim hits? Because the markers are there. And that’s sort of the beauty, right?

Like if you look backwards, you will always say, well, yeah, it’s obvious. It’s not obvious because there’s factors that you couldn’t control, but doing your best to identify them and figuring out how to intervene early in my mind is the only remedy.

Mehb Khoja

Ashley, I’ll give you the last word.

Ashley Hume

All right. Well, I mean, my one takeaway is start now, because right now we have 40 per million in a commercial setting that are going to receive a cell or gene therapy in 2026, receive like get over the finish line. A lot more are going to start the process.

But we’re looking down the barrel of a gun here because we’ve got type one diabetes, we’ve got lupus, Parkinson’s, like you name it, like conditions where, you know someone, probably somebody in your family, has one of these conditions and they’re going to have approvals in the next couple of years.

And I heard somebody say earlier that they’re encouraging their clients to implement mid plan year. Do that. I can’t tell you how often we are in the process of with an employer or with a regional health plan to onboard them for our services. And they’re like, yeah, we’re going to look at this for ’27 or for ’28. And then a few months later they call and say, oh geez, we just heard that we have a patient with X, can you help us?

And we’re like, we would love to and we don’t have the structures in place. So we’re a point solution. So we work with health plans and general employers. We also work with the Blues through Synergie. Like we are trying to get in front of these issues.

And the best thing you can do is ensure if you’re going to work with a point solution, that you have a fee structure that works for where you’re at today. So probably more like a case based fee structure. So you’re not paying for something you’re not going to use, but you have it in place and people know what to expect so that when it happens, you’re not just standing there wishing you would have.

Mehb Khoja

There’s a lot of solutions that are out there. The key is having them in place before you actually need it. Right? But there are a lot of solutions out there. We’re going to leave it there for today. Help me thank the panel and we’ll join you all again next time on Firm and Final. Thank you.