Assessing Value in Cancer Care:Advances in UGI Malignancies as a Case Study

Neal J. Meropol, M.D.

Chief, Division of Hematology and Oncology

University Hospitals Case Medical Center

Case Western Reserve University

Cleveland, OH

Moving the Bar in UGI Malignancies: A Review of Recent UGI Phase III Studies—Clinically Meaningful or Just Statistically Positive?

What the media tells us

• “Targeted therapy save lives!”• “We’re going to bankrupt the

economy!”• “The pharmaceutical industry is

evil!”

What we should be asking

• What does this mean for individual patients and their decisions about treatment?

• What does this mean for how we invest in, develop, and pay for new cancer treatments?

Adapted from C. Borger, et al. Health Affairs 25(2): w61-w73, 2006; Reproduced in Meropol and Schulman, J Clin Oncol, 2007

US Health Expenditures and GDP

$25,000 $30,000 $35,000 $40,000 $45,000 $50,000 $55,000 $60,000 $65,000$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

Australia

Austria

BelgiumCanada

France

Germany

Italy

Japan

Netherlands

Norway

SpainSweden

Switzerland

U.K.

USA

Total Health Expenditure per Capita and GDP per Capita,

US and Selected Countries, 2008

GDP Per Capita

Per

Capit

a H

ealt

h S

pendin

g

Source: Organisation for Economic Co-operation and Development (2010), "OECD Health Data", OECD Health Statistics (database). doi: 10.1787/data-00350-en (Accessed on 14 February 2011).Notes: Data from Australia and Japan are 2007 data. Figures for Belgium, Canada, Netherlands, Norway and Switzerland, are OECD estimates.

Health Expenditures and Life Expectancy

Fuchs and Milstein, NEJM 2011

Growth in healthcare spending is greater than growth in GDP (but this has moderated recently)

Healthcare Costs: A Primer, Kaiser Family Foundation, 2007

NIH Estimates for Cancer Costs in the United States: 2010

• Total costs: $264 billion• $103 billion for direct medical

costs• US spends ~$2.5 trillion on

healthcare per year

Factors contributing to high cost of cancer care

Demographics• Aging of population

Unit cost• Exclusivity-patent protection• High cost of drug

development/manufacture

Regulatory• Medicare standard:

“reasonable and necessary” – not value

• Medicare unable to negotiate price

Schnipper, Meropol, Brock, Clin Cancer Res, 2010Peppercorn, Sikora, Zalcberg, Meropol, Lancet Oncol, in press.

Demand• Use of treatments with

small benefit and high cost (overutilization)

• Physician commitment to individual patients

• Neither patient nor physician incentivized to consider cost (moral hazard)

• Diagnostics (Dinan et al. JAMA 2010)

Oncology Drug Contribution to Spending Growth - 2009

Growth RateAll clinic drug expenditures5.1%Antineoplastics 9.5%

*Cancer drugs are #1 among hospital and clinic drug expenditures*In general, drugs account for only 10% of healthcare spending *>1/3 of Medicare drug spending is cancer-related

Doloresco F et al. Am J Health-Syst Pharm, 2011MEDPAC Data Book, 2010

Influences on drug expenditure trends

• Growth in spending is moderating overall– Increased supply: generics– Decreased demand: recession, unemployment,

cost-sharing, fewer new drugs to market– 2006: 8.9% > 2007: 4% > 2008: 1.8%

• Health reform• Increased specialty drugs

Hoffman JM et al. Am J Health-Syst Pharm, 2010

The Cost of Care Has Wide Impact

PatientsProducers Providers

Payers Employers

Cancer is a substantial financial burden on individuals

Bernard et al. JCO, 2011

What is the value?

PFS OS

Cont Exp HR P Cont Exp HR P

Pancreatic, Gem±Erlotinib

3.6 3.8 .77 .004 5.9 6.2 .82 .038

Hepatoma, BSC±Sorafenib

2.8 5.5 .58 <.001 7.9 10.7 .69 <.001

Gastric, FP/CP ±Trastuzumab

5.5 6.7 .71 .0002 11.1 13.8 .74 .0046

Biliary, Gem±Cisplatin

5.0 8.0 .63 <.001 8.1 11.7 .64 <.001

NET, BSC±Sunitinib

5.5 11.4 .42 <.001 early .41 .02

NET, BSC±Everolimus

4.6 11.0 .35 <.001 early 1.05 .59

What is the clinical benefit?

Very low

Modest

Higher

Moore, JCO 2007; Llovet, NEJM 2008; Bang, Lancet 2010; Valle, NEJM 2010; Raymond, NEJM 2011; Yao, NEJM 2011

What is an ICER (Incremental Cost Effectiveness Ratio)?

ICER =

COSTnew - COSTstandard

EFFECTnew - EFFECTstandard

Survey of US OncologistsWhat do you think is a reasonable definition of "good value for money" or cost-effectiveness per life-year gained?

$0–$50,000 21%

$50,001–$100,000 49%

$100,001–$150,00019%

$150,001–$200,0006%

>$200,000 5%

Neumann et al. Health Affairs, 2010

ToGA: Cisplatin/Fluoropyrimidine +/- Trastuzumab in Gastric Cancer

Control(N=290)

Trastuzumab(N=294)

Hazard Ratio P

Median Survival

11.1 mo. 13.8 mo. .74 (0.6 – 0.91) .0046

Median Survival – “High HER2”

11.8 mo. 16.0 mo. .65 (.51-.83) .036 for interaction

Progression Free Survival

5.5 mo. 6.7 mo. .71 (0.59-0.85) .0002

Progression Free Survival – “High HER2”

5.5 mo. 7.6 mo. .64 (.51-.79)

Response rate 35% 47% .002

Bang Y-J et al. Lancet 2010

Comparison of results of Trastuzumab in metastatic breast cancer and gastric cancer

Trastuzumab in breast Trastuzumab in gastric

Control (N=234)

Tras(N=235)

HR P Control (N=290)

Tras(N=294)

HR P

PFS 4.6 mo.

7.4 mo. .51 <.001 5.5 mo. 6.7 mo. .71 .0002

5.5 mo.High HER2

7.6 mo. .64

OS 20.3 mo.

25.1 mo.

.80 .046 11.1 mo. 13.8 mo. .74 .005

11.8 mo.High HER2

16.0 mo. .65

Resp Rate %

32% 50% .001 35% 47% .002

Slamon DJ. NEJM, 2001 Bang Y-J et al. Lancet 2010

NICE assessment of Trastuzumab

• Issues for NICE– What is the appropriate comparitor for ICER

calculation? ECF? CF? EOF?– What HER2 subgroup?– Incurable disease, size of population?

• Comparitor: epirubicin 3-drug regimens• ICER = >£63,100-£71,500 per QALY for

licensed population• ICER = £45,000-50,000 per QALY for IHC 3+

population -- APPROVED

Cost Effectiveness of new oral therapies for cancer: British payor perspective

Renal Studies OS PFS ICER

Sunitinib vs. IFN 1st line 26 vs 22 mo 11 vs 5 mo £71,462

Everolimus vs BSC 2nd line Too early 4 vs 2 mo £51,613

Liver cancer

Sorafenib vs. BSC 10.7 vs. 7.9 mo 6 vs. 3 mo £64,754

NET Studies

Sunitinib vs. BSC 11 vs. 6 mo.

Everolimus vs. BSC 11 vs. 5 mo.

Coon et al. Health Technology Assessment 14 (2):2010Motzer et al, Lancet 372:449-56, 2008. Motzer et al, NEJM 356:115-24, 2007.Motzer et al, J Clin Oncol 27: 3584-90, 2009www.nice.org.uk/guidance/TA189

PFS OS

Cont Exp HR P Cont Exp HR P

Pancreatic, Gem±Erlotinib

3.6 3.8 .77 .004 5.9 6.2 .82 .038

Hepatoma, BSC±Sorafenib

2.8 5.5 .58 <.001 7.9 10.7 .69 <.001

Gastric, FP/CP ±Trastuzumab

5.5 6.7 .71 .0002 11.1 13.8 .74 .0046

Biliary, Gem±Cisplatin

5.0 8.0 .63 <.001 8.1 11.7 .64 <.001

NET, BSC±Sunitinib

5.5 11.4 .42 <.001 early .41 .02

NET, BSC±Everolimus

4.6 11.0 .35 <.001 early 1.05 .59

What is the clinical benefit?

Very low

Modest

Higher

Moore, JCO 2007; Llovet, NEJM 2008; Bang, Lancet 2010; Valle, NEJM 2010; Raymond, NEJM 2011; Yao, NEJM 2011

Clinical Benefit

New Drug Cost/Year of New Drug

Value?

Pancreatic, Gem±Erlotinib

Very low Erlotinib $53954 Very low

Hepatoma, BSC±Sorafenib

Modest Sorafenib $115866 Low

Gastric, FP/CP ±Trastuzumab

Modest Trastuzumab $51225(exclude load)

Modest

Biliary, Gem±Cisplatin

Modest Cisplatin $364 Higher

NET, BSC±Sunitinib

Higher Sunitinib $108569 Higher

NET, BSC±Everolimus

Higher Everolimus $201516 Modest

What is the drug value?

Based on AWP for oral drugs, ASP for IV

What does the tras story tell us about the future of oncology clinical trials and oncology care?

• Diagnostics development must begin early in clinical development

• All cancers will become “rare” cancers• “Blockbusters” are dinosaurs• The bar must be set high early in clinical

development• Treatment based on site of origin is being

replaced by treatment based on phenotype

The impact of the cost of the diagnostic

• Everyone gets the diagnostic test• Only a subset get treated (i.e. the test results in

fewer patients treated)• Cost-effectiveness of diagnostic improves as:

– Cost of diagnostic decreases– Discrimination ability of diagnostic improves

(who wont benefit at all; who will benefit greatly with treatment)

• If treatment improves overall, diagnostic becomes less cost-effective

Impact of personalized medicine on pharmaClear advantages

Longer treatment duration

Potential new indications, new market

Competitive advantage with “personalized” approach

Co-marketing of diagnostic

Clear disadvantages

Reduced market size

Uncertain

Development time of new therapeutic

Success in bringing pipeline therapeutic to market

Impact of higher-value therapeutic on pricing/willingness to pay

Peppercorn, Sikora, Zalcberg, Meropol. Lancet Oncology, in press.

Where we need to go

• Reduce overutilization – eliminate non-beneficial interventions

• Raise the bar for approval• Link payment to value – cost-sharing• Authorize CMS to negotiate price• Reduce incentives for development of marginal

advances• Improve evidence base: comparative

effectiveness research

Schnipper, Meropol, Brock, Clin Cancer Res, 2010Peppercorn, Sikora, Zalcberg, Meropol, Lancet Oncol, in press.

Value-based insurance design

• Not all effective treatments have equivalent value

• Cost sharing can be used to discourage low value treatment and encourage high value treatment (contrast with current plans that base coverage on cost )

• Potential for different coverage based on disease/stage

What defines value?How can we move from implicit to explicit and transparent decisions regarding allocation of scarce resources?

Drummond et al. Can J Clin Pharmacol, 2009

Cancer?

Politics is the third

dimension

Our new cancer hospital