Swiss drugmaker Novartis is looking to partner with global reinsurance companies to help health systems bear the cost of new generation, personalized therapies, according to the Financial Times.
The idea to work with the reinsurance industry comes as Novartis and other pharma giants brainstorm ways to finance drugs with high potential but hefty price tags. Many drugmakers are increasingly betting on these specialized cell and gene therapies — which offer the prospect of curing patients from once incurable diseases — for revenue growth.
Novartis CEO Vas Narasimhan told the Financial Times that the company is considering is a "reinsurance model in which a third party underwrites the catastrophic case of a child having one of these conditions."
A reinsurance model could prove attractive for both the insurance and pharmaceutical industries.
Reinsurers, which already provide a backstop to employer health insurance plans, could benefit from this new revenue and help differentiate themselves from the competition. The could pool the cost of treatments by drug companies across the country to spread out risk.