Innovation is an important word in the pharmaceutical sector. There are high expectations for groundbreaking new products in the field of Advanced Therapy Medicinal Products (ATMPs). However, the first wave of products in this category has not been an unqualified success—and that is because insufficient thought has been given to what the market for this type of product should look like.

ATMPs are an exciting category of pharmaceutical products
ATMPs are a group consisting of gene therapy, cell therapy, and tissue-based therapy, in which major scientific advances have been made over the past decade. Concrete products have been developed for all these therapeutic modalities, which have been clinically tested and are commercially available. The category of ATMPs is quite heterogeneous, as gene and cell therapy differ considerably from each other. What the modalities have in common is that they hold the promise of addressing the underlying causes of serious diseases with a one-time or long-lasting effect. These promises have also generated enthusiasm among companies, investors, and patients.

Yet there is much discontent
Despite the promises and enthusiasm, innovators still have many hurdles to overcome. Naturally, there are still questions surrounding the safety of some medicines. More importantly, however, the long-term efficacy of these medicines is still unclear. This is logical given the short period of time in which these drugs have been allowed to prove themselves. However, the products are coming onto the market at high prices; the list prices are sometimes a few million per patient. At such prices, uncertainties about efficacy become more urgent: you don’t pay for a Ferrari if it’s not clear whether you can take it on vacation.

This situation has caused a lot of discontent. Pharmaceutical companies, mostly from the US, complain that reimbursement authorities are not accommodating enough. For this reason, Bluebird Bio has withdrawn its products from Europe. Of the 13-15 gene therapies that have been granted marketing authorization in the US and Europe, only a few appear to be financially successful. One example is onasemnogene abeparvovec (Zolgensma), but even there, there is a lot of criticism about the high prices. These high prices have led to various projects in the Netherlands where university medical centers are going to produce their own variants of ATMPs such as CAR-T. Naturally, this has also led to discontent among the pharmaceutical industry, which believes that university medical centers should not have this role.

Thinking about innovative markets
When new products are introduced, the market in which these products become part of often does not change much. An example is LED lamps: consumers continued to buy lighting in stores; wiring, sockets, and electricity rates did not change. In some cases, the innovation is so groundbreaking that markets are also reorganized. The introduction of electric cars was accompanied by different charging infrastructure, business models, and consumer mindsets, while smartphones brought us app stores, dependencies on operating systems and digital ecosystems, and the emergence of subscription-based revenue models.

ATMPs can also be regarded as a group of groundbreaking innovations and therefore deserve a new market. It is unjustified—and perhaps naive—to assume that the market for small molecules is capable of accommodating gene and cell therapies. More thought needs to be given to revenue models, infrastructure, reimbursement, manufacturing, and so on.

Of course, this thinking is already well underway. For example, you could view the academic manufacture of CAR-T as an attempt to reorganize the value chain and the distribution between public and private. And in the HTA world, a lot of thought has already been given to outcome-based payments, payment in installments, or subscription models. So far, it has remained at the level of thinking and initial attempts. This is probably because stimulating new marketplaces requires coordination, and it is not clear who should take on this coordination. However, it is worth being aware that ATMPs need – and deserve – an innovative market structure for these products. It is therefore a positive step that the ATMP field has united in ATMP-NL; only through structural cooperation, as is also being pursued within FAST, can we build a well-functioning system that contributes to accelerated and affordable access to innovative therapies for patients in the Netherlands.

Wouter Boon is Professor of Innovation and Transition Studies at Utrecht University and affiliated with the Copernicus Institute of Sustainable Development. He researches emerging technologies and their contribution to societal transitions. Wouter studies innovations that lead to a responsible and accessible healthcare system, more specifically innovations in the field of prevention, digital solutions (AI, eHealth), imaging, and pharmaceutical products. He also looks at innovations for sustainable mobility (car sharing, electric cars) and energy (local energy initiatives). Theoretically, he contributes to improving our knowledge of how users of innovations become involved and are involved in innovation processes. Wouter Boon spent most of his research time studying the demand side of innovation processes: what is the role of users in shaping and accepting new products and services? How do markets for new products emerge and how can these markets contribute to transitions? How can innovations be scaled up in a socially responsible manner? And how can the government work on demand-driven innovation policy?