Could the ‘Netflix Model’ work for gene therapy?

New treatments for genetic diseases are promising but expensive. [Bloomberg]( This is Bloomberg Opinion Today, a miracle cure of Bloomberg Opinion’s opinions. [Sign up here](. Today’s Agenda - Gene [therapies]( can’t be stopped. - Poland’s [populism]( got popped. - The [federal deficit]( must adopt. - Temperature [records]( got topped. Laundry Day Did you do your laundry over the weekend? I ask because the average person washes their clothes one to three times a week. That’s 50 to 150 loads every year. Some of you might have a washer and a dryer at home. Others (like me!) have not been blessed by the laundry gods, so we have to either go to the machines in the basement or trudge to the laundromat to do our wash. At the laundromat, you might have to drop a dozen quarters in the machine, or maybe you have to buy a refillable card. Either way, you’re paying per wash. Then there are laundry services — some of them pay-per-load, others by pay-by-weight, still others subscription-based — which will pick up your garments up at your door. This is more expensive, obviously, but it saves time. By now you may be wondering when this newsletter became a glorified Wikipedia page for [laundry](. Valid question! I am telling you all of this not because your dirty laundry is particularly interesting, but because it’s going to help me explain gene therapy, a highly precise procedure that fixes errors in our DNA. Lisa Jarvis [recently met]( LaShaundra Carter, who was hospitalized some 100 times in 2018 — about as often as you might do your laundry in a year. Carter was making such regular trips to the ER because she suffered from sickle cell disease, a genetic disorder that causes red blood cells to warp and get trapped in blood vessels. This disease affects some 100,000 people in the US — predominantly Black Americans — and patients can suffer from pain that feels like “shards of glass running through their veins,” Lisa writes. For many years, the illness was dismissed by researchers, but despite the disease’s pernicious history of racism, there’s still hope for a cure. In 2020, Carter began a clinical trial of a gene therapy treatment, where doctors managed to replace her sickled cells with modified ones that could “produce beautifully flexible and disc-shaped red blood cells.” Thanks to the therapy, she’s been pain-free for almost three years. LaShaundra Carter, her son Isaiah Carter, and her mom, Sheree Powe Photographer: LEXI COON “The tens of thousands of people with sickle cell should all have the same opportunity as Carter: to wake up one day and feel what it’s like to not be in pain,” Lisa writes. “Equitable access is also what matters for the future of the technological revolution brewing in medicine. After all, what good are miracle cures if only the few can get them?” By the end of this year, the gene therapy that Carter received is expected to be approved by the FDA. Although it was free for her during clinical trials, the drug is expected to [cost]( between $1.35 million and $2 million. On the low end of that projection, that amount of cash could buy 56 brand new Honda Civics (base model only, no extras). Which begs the question: Is it fair to make a life-saving drug so expensive? Lisa says Big Pharma’s imperfect math equation for gene therapy is sketchy at best, involving a complex series of questions that attempt to quantify a drug’s value to society: After treatment, how many hospital visits will the patient avoid? How many [prescriptions]( will no longer need filling? How many quality years of life will they gain? Eventually, they land on a million-dollar figure that has more hot air than zeroes. To bring all this back to laundry day: Just as there are many ways to pay for clean shirts, so are there many ways to pay for gene therapy. As it stands, these are the two most compelling models: - An Outcomes-Based Contract: This model tethers the company’s financial rewards to how patients on the treatment fare over time. - The Netflix Model: Rather than pay per patient, the state pays a flat fee for unlimited access to the treatment.[1](#footnote-1) An estimated two-thirds of sickle cell treatment-seeking patients will be publicly insured, either through Medicare or state Medicaid programs. The wave of new gene therapy could cost $12.2 billion per year, which means state governments are in for a world of hurt, financially speaking. “We used to call it the whack-a-mole principle,” says Rebekah Gee, the former secretary of health for Louisiana. “If something goes up, something has to come down.” Money printers can’t just go [brrrr]( in this instance: “While large plans might be able to manage the occasional multimillion-dollar drug, that kind of hit will blindside self-funded plans,” Lisa writes. Typical plans with 1,000 people have an annual budget of about $6 million per year. If just one of those individuals needs gene therapy, it will wipe out more than half of the budget. The Netflix Model would help absorb a lot of that financial pain, especially if it were tied to outcomes. A combination of both strategies might be just what gene therapies need, Lisa writes. Read the whole feature [here](. It will certainly put any complaints you might have about doing the laundry in perspective — and give you a lot to think about as you wait for your clothes to dry. Poland’s Positive News Poland’s back, baby!! For a minute there, it seemed like it was headed for a [Polexit](, despite having just joined the EU in 2004. But “Poland — whose eight years of euro-skeptic, conservative rule under the Law and Justice (PiS) party put it in the same illiberal camp as Viktor Orban’s Hungary — now looks headed for [closer]( ties with the European Union,” Lionel Laurent [writes](. After a record [turnout](, Sunday’s exit polls suggest Donald Tusk is set to return as prime minister. “This is a big deal, politically and economically, as the bounce in investor optimism suggests,” he says. Saying the EU is fragile right now is an understatement. Authoritarian leaders dead-set on destroying the rule of law are setting up camp in Hungary, Turkey and most recently Slovakia. For nearly a decade, Poland, too, was one such place. But Tusk’s apparent victory “is a warning to politicians who expect the recipe of polarization, scapegoating and budget giveaways to work every time,” Lionel argues. Although the centrist prime minister will undoubtedly clash with PiS-backed Polish President Andrzej Duda — who will remain in power until 2025 — Tusk’s pro-European presence should fortify the country in more ways than one. Telltale Map As you read this, three more warships and a contingent of Marines are making their way to the coast of Israel. The fleet — coming from Kuwait — is expected to arrive by the middle of this week. In his latest column, James Stavridis [wonders]( how they could be used in the Gaza war. “The principal reason to consider speeding them to the scene of the crisis is the presence of so many US citizens in a war zone. There are roughly 200,000 Americans, mostly dual citizens, in Israel,” he writes. Just today, Israel decided to [evacuate]( several towns near its border with Lebanon. “There is a very real risk of a wider conflict if Hezbollah — with the likely green light from Iran — decides to join the fight from the north,” he explains. Telltale Charts The random [baby]( that George Santos was holding on Friday isn’t the only [mystery]( on Capitol Hill. Matthew Yglesias [says]( the federal deficit remains a puzzle that not even Paul Krugman can [solve](. “Thanks to Bidenomics, the US is fully employing the manpower and resources available to the country for the first time in my career. That’s great news — but it means that government money isn’t free,” Matthew writes. If you were to ask me who used the phrase “gobsmackingly bananas” to describe a scientific trend before today, I’d probably have said [Ms. Frizzle]( on the magic school bus. But no! It [was]( Zeke Hausfather, a researcher at the nonprofit group [Berkeley Earth](: “The first global temperature data is in for the full month of September. This month was, in my professional opinion as a climate scientist — absolutely gobsmackingly bananas,” he said. The [hottest September on record]( “comes after the warmest June ever recorded. And the toastiest July. The same was true for August. And it will likely be followed by a warmer-than-average October,” Lara Williams [writes](. As it stands, these record temps don’t doom our climate fight. But until we stop burning fossil fuels, the planet will continue to get hotter. Governments subsidizing such emissions are largely to blame: Last year alone, says Bloomberg’s editorial board, “fuels that drive climate change and pollute the air were [underpriced]( to the tune of $7 trillion. It’s hard to think of a more misguided policy.” Further Reading Why did Australia [fail]( its First Nations citizens? — Ruth Pollard The SEC’s [new rules]( for hedge funds lack an accountant’s precision. — Aaron Brown British grocery stores are getting way too into [rewards programs](. — Andrea Felsted Italy’s debt-laden xenophobic government is using the culture wars as a [distraction](. — Rachel Sanderson China’s latest [real estate headache]( has everything to do with private equity. — Shuli Ren [Singapore](’s glass-half-full view of the global economy is good news. — Daniel Moss Katy Perry may be singing all the way to the bank, but it hasn’t always been [like this](. — Stephen Mihm Putin and Xi’s “no limits” [friendship]( is getting messier and messier. — Minxin Pei [Sports M&A]( is alive and well. — Adam Minter ICYMI Trump got [a gag order](. Rite Aid filed for [bankruptcy](. (Leticia Miranda has [thoughts](.) Lululemon is [joining]( the S&P 500. SBF’s new plan to win in court: [Adderall](. Kickers London’s toilet graffiti is [pure art](. (h/t Andrea Felsted) Cruise ship [condos]( go on sail. Meet the [anti-avocado militias]( of Michoacán. Tesla’s [three-pack of beer](costs $97. Would you vote for a [Romney-Winfrey]( ticket? Bottomless brunch comes with [a vomit fee](. Notes: Please send CyberBeer and feedback to Jessica Karl at jkarl9@bloomberg.net. [Sign up here]( and follow us on [Threads](, [TikTok](, [Twitter](, [Instagram]( and [Facebook](. [1] Louisiana pioneered this model after the FDA approved Sovaldi, Gilead’s groundbreaking Hepatitis C virus treatment. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. 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