New System Needed for Pricing Oncology Pharmaceuticals
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Anti-cancer therapy is big business. In Australia alone between 2000 and 2009, cancer-related pharmaceutical expenditure has risen over 200% to over half a billion dollars per annum.
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New System Needed for Pricing Oncology Pharmaceuticals
- 2. Phil Haywood Do we need a new system to price oncology pharmaceuticals?
- 3. • Increasing numbers of expensive pharmaceuticals for use in oncology • Unaffordable by most people if not subsidized ($40,000 to $70,000 per course) • Oncology drugs cost over $Aus1 billion in 2009 ($5 billion for cancer care) • Oncology drugs are one of the most rapidly increasing portions of the PBS – cost control • Genetic guided treatment reducing the size of market for pharmaceuticals- incentive issue Outline of the potential problem…(1)
- 4. • Potential for treatment to increase in length (multiple lines of therapy) • Evidence this is happening within the clinical literature • Limited clinical evidence supporting length • Economic evaluation and subsequent decision making based on clinical evidence • May not describe the clinical situation and may give rise to inaccurate economic evaluations and decisions • May not result in health maximising decisions • In Australia, Pharmaceutical Benefits Scheme central to this, could potentially result in inaccurate pricing decisions and incorrect Outline of the potential problem…(2)
- 5. Stylised Australian Process • Evaluate one pharmaceutical at a time • Compare to alternatives in line of therapy • Each decision made on the basis of cost- effectiveness and effectiveness • Each decision may be correct but may not represent the more global picture
- 6. Framework PBAC Decision New Treatment Pathway First Line Treatment Second line treatment Third line treatment Pharmaceutical A vs No treatment A A None None Pharmaceutical B vs Pharmaceutical A B A B A None Pharmaceutical C vs Pharmaceutical B C B A C B A • Drugs are displaced from one line of therapy to the next • In the new line of therapy they have not been evaluated • If the characteristics of the drug change the old evaluation is invalid Time
- 7. Evidence- Analysis of protocol A and protocol B
- 8. Overall survival is the same
- 9. But progression free survival was not 4.8 months versus 3.1, p<0.01
- 11. Pharmaceuticals more toxic when used later • 60% more adverse events when used in a later line of therapy • If restrict to the classic adverse events for chemotherapy 80% more adverse events • Therefore pharmaceuticals less effective but more toxic when used displaced from one line of therapy to the next
- 12. Scenario Cost Effectiveness NMB (population, portion receiving treatment) Required price reduction Advanced Breast Cancer $40,781 per quality adjusted life year $4 million loss 4% Advanced Pancreatic Cancer $70,412 per quality adjusted life year $2 million loss 56% Advanced Lung cancer $40,215 per quality adjusted life year $0.2 million loss 1% Advanced Melanoma $82,743 per quality adjusted life year $43 million loss 91%
- 13. Conclusions • Increasing numbers of pharmaceuticals not supported by evidence base • Evidence suggests less effective and more toxic • Modelling suggests price reductions based on outcomes appropriate • Oncology may need to move to outcome based reimbursement
Editor's Notes
- Introduce self Thank Marion Thank TCRN, CHERE, UTS for financial and non-financial support Thank supervisors
- There are three separate issues that combine to potentially cause an issue that requires thought within economic evaluations The first is that there are increasing treatments available for use in cancer treatment, these treatments can be used in sequence one after another, thus increasing options can result in an increasing length of treatment The second is that there is limited clinical information available about the use of later treatments which makes the evaluation of the later lines of therapy difficult These two features mean that both economic and clinical evaluation difficult 3. The third is that there is the subsidisation and pricing of cancer pharmaceuticals by a third party, in Australias case this in the Pharmaceutical Benefits Scheme. The problem is that if the information used is not correct then the pricing may be inaccurate, either too high or too low, if it too high we are forgoing health in other areas, if it is too low lowering incentives for designing and distributing new pharmaceuticals
- There are two potential issues that may result in a problem in the length of treatment The first is that there are increasing treatments available for use in cancer treatment, these treatments can be used in sequence one after another, thus increasing options can result in an increasing length of treatment The second is that there is limited clinical information available about the use of later treatments which makes the evaluation of the later lines of therapy difficult These two features mean that both economic and clinical evaluation difficult 3. The third is that there is the subsidisation and pricing of cancer pharmaceuticals by a third party, in Australias case this in the Pharmaceutical Benefits Scheme. The problem is that if the information used is not correct then the pricing may be inaccurate, either too high or too low, if it too high we are forgoing health in other areas, if it is too low lowering incentives for designing and distributing new pharmaceuticals
- This is a stylised example of the decision making process of the PBS, essentially pharmaceuticals are offered up for evaluation one and a time. They are compared on the basis of the best available evidence to the alternatives, remember the evidence is limited Each decision is made on the basis of the effectiveness and cost-effectiveness to the drugs However the whole treatment sequences may not be represented by each of the aggregate of the individual decisions
- Here is an example of this Time passes as you move down the table, new pharmaceuticals are developed and introduced into practice, evaluated and subsidised The first column is the decision that the PBS evaluates, one drug against it nearest alternative The second column is the new treatment pathway for patients, increasing pharmaceuticals result in an increasing treatment sequence with the best drug being used first The final three column show the pharmaceuticals used in each line of treatment, first line is the first drug used until it fails then second line etc As can be seen for drug A as new and improved pharmaceuticals are used it gets used later and later So one issue is that drug A has not been evaluated in its new line of treatment This is not a problem if the characteristics of the drugs are not altered, its cost, its toxicity and its effectiveness, however if it is altered then there is a potential problem
- In order to evaluate the potential change in the characteristics a variety of clinical evidence was assessed I am going to present the evidence synthesised from randomised controlled trials the best available evidence Looked for a specific type of RCT, one where patients received two or more lines of therapy These are quite rare, then I compared the characteristics of the each treatment in the initial and subsequent line of treatment So in the stylised example this trial generates two comparisons , one for protocol A and one for protocol B
- Here is a meta-analysis of one characteristic, overall response, which is the portion of patients who experience shrinkage of the tumour This is a forest plot where individual studies are combined to improve the power Each line is an individual comparison, the edges show the 95% CI, the size of the diamond is relative to the number of participants The solid line represents no difference between the comparisons, if the comparison is to the left then it implies the drug performed between in the initial line of treatment, to the right implies that the drug performed better in the second line of treatment As I said most trials produced two comparisons I have separated this into cancer types, lung cancer, gastric cancer, colorectal cancer and pancreatic cancer Overall drugs before half as well in the subsequent line of therapy compared to the initial line of therapy, but as can be seen there is enormous variation between cancers This is consistent with the other characteristics
- Here are a number of examples to show the impact that the mispricing could occur