Within the oncology community, price tags have sparked debate.
Hagop Kantarjian is concerned about the high prices of immunotherapies and other cancer drugs, and he’s being anything but quiet about it.
In May 2013, Kantarjian and 120 other doctors and researchers published a commentary in the journal Blood, calling for lower drug prices. The following year, Kantarjian was lead author on the paper “High Cancer Drug Prices in the United States: Reasons and Proposed Solutions,” published in the Journal of Oncology Practice.
“It is our obligation as cancer doctors to keep patients from harm and injustice,” says Kantarjian, a medical oncologist with the Department of Leukemia at the University of Texas MD Anderson Cancer Center, in Houston. “If high prices make drugs unaffordable and inaccessible, thus causing harm, then we should do something.”
So, Kantarjian is.
Frustrated with the lack of movement on the prices of cancer drugs thus far, the doctor and some of his colleagues have supported a patient-driven online petition (http://chn.ge/1DCWT1M
) asking Congress to give the government, patients and other stakeholders more power when it comes to negotiating prices for cancer drugs.
Currently, prices are set by the companies that make the medications. While drug makers maintain that their prices reflect the value of their immunotherapies, as well as a continuing investment into research aimed at creating new cancer drugs, they point out that they are making it easier for some to afford the medications via financial assistance programs.
Ultimately, Kantarjian and his colleagues want prices that maintain reasonable profits for drug companies while reflecting a drug’s benefit and, yet, remaining affordable to both patients and the health care system.
But who should decide what constitutes “reasonable” or “affordable,” and how? People in all corners of the oncology world are working to answer those questions. Researchers are conducting cost-benefit analyses, oncology organizations are offering advice and patients are being polled about their ability to keep up with prices.
To succeed, “we have to acknowledge that there must be some upper limit to how much we can, as a society, afford to pay to treat each individual patient with cancer,” says Leonard Saltz, a medical oncologist at Memorial Sloan Kettering Cancer Center who has been very involved in the debate over cancer-drug prices. “All of us need to be willing to discuss what that might be.”
HAGOP KANTARJIAN , shown on the job at MD Anderson Cancer Center, wants patients, physicians and the government to have a role in setting the prices of cancer drugs. PHOTO BY F. CARTER SMITH
The Cost of Immunotherapy
Since 2000, the average price of new cancer drugs has increased from between $5,000 and $10,000 per year to more than $120,000 per year, while the average household income for a family of four has dropped by 8 percent over the last decade to $52,000, Kantarjian and colleagues say. In fact, of 12 new oncology treatments approved in 2012, 11 were priced above $100,000 for one year of treatment, Kantarjian reported in his commentary in Blood.
“Even patients with insurance have out-of-pocket expenses of 20 to 25 percent,” the petition states. “This could force many families to decide whether to pay $25,000 a year for one cancer drug, about half the household income, or forgo the treatment to save the money for other necessities.”
The prices of immunotherapies are becoming an increasingly important part of the equation, since the U.S. Food and Drug Administration has approved five such drugs – including Opdivo (nivolumab), Yervoy (ipilimumab) and Keytruda (pembrolizumab) — within the past few years, and more are in the pipeline. Eventually, some of these may be used as part of more expensive combination regimens.
Costs and sales of oncology drugs and immunotherapeutics are rising more quickly than other biopharmaceutical sectors, notes Saltz. Envisioning the transformation of some cancers into chronic conditions, Citigroup analyst Andrew Baum expects immunotherapy revenues to reach $35 billion within 10 years.
Although these new treatments could radically change the oncology market, there is still a question about whether they will ultimately decrease or increase the cost of treating cancer.
Opdivo, approved for both melanoma and lung cancer, is priced at $12,500 a month, or about $150,000 for a year of treatment; patients take the drug until disease progression or unacceptable toxicity. Keytruda, approved for the treatment of metastatic melanoma, will cost about the same.
Yervoy, approved in 2011 for patients with either previously treated or newly diagnosed advanced melanoma, costs $130,000 for a 12-week course, and some patients take more than one course.
Provenge (sipuleucel-T), a series of three immunotherapy vaccines approved in 2010 based on its ability in a clinical trial to improve median overall survival of men with advanced prostate cancer by 4.1 months, is priced at $93,000 per patient.
The establishment of these prices is likely to support the setting of similar prices for such drugs approved in the future, according to Daniel M. Geynisman, of the Department of Medical Oncology at Fox Chase Cancer Center in Philadelphia, and colleagues in a 2014 review of studies on the cost-effectiveness of cancer immunotherapies.
“A common tactic of pharmaceutical companies is to benchmark prices of new oncologics against existing products and to set the price at a level that is at least as high as the highest priced competing product,” they wrote.
Merck and Dendreon, at least in part, relied on that strategy.
“In pricing Keytruda, we thoroughly considered the unique clinical value of this innovative therapy in advanced melanoma, possible future uses in other cancers and our commitment to access,” says Frank Clyburn, president of Merck Oncology. “The cost of Keytruda is also consistent with other innovative oncology medicines, including the standard of care in advanced melanoma.”
Dendreon considered the millions of dollars spent developing Provenge and seeking its FDA approval; the substantial manufacturing cost for the therapy, which cannot be mass-produced because it incorporates the blood cells of each individual patient; and its benefit-to-risk ratio. “The Provenge price, along with the therapy’s efficacy and safety profile, created a cost per QALY (quality adjusted life year) that was in line with most other therapies available and lower than many,” says Dendreon General Manager Jim Caggiano.
Likewise, Bristol-Myers Squibb considered a host of issues when it set prices for Opdivo and Yervoy, “including the value they deliver to patients and society, the scientific innovation they represent, and the investment required to continue to research and develop innovative medicines in our pipeline,” a company spokesperson says. “As a company, we are sensitive to concerns about the rising costs of health care, including pharmaceuticals, and the importance of continued access to medicines, while recognizing there remain significant unmet needs that require continued development of innovative treatment options.”
All three companies offer and/or donate to programs that may assist patients in paying for the medicines or getting them for free.
What is it worth?
Recognizing that putting a dollar value on human life is difficult, and that the figures are debatable, some experts quote the price of one year of extended life to be $50,000 to $60,000. For example, if a drug improves life duration by 50 percent to 90 percent over life expectancy or by six to 11 months, it might be priced at $30,000 to $50,000. Many recent cancer therapies that offer such benefits, however, carry higher price tags.
In their recent review, Geynisman and his co-authors found that, while the cost-effectiveness of many immunotherapies has yet to be studied, most that have been analyzed have high incremental cost-effectiveness ratios (ICERs), meaning that their dollar costs are high in relation to the benefits they offer, when compared against the costs and benefits of standard treatments.
→ THE AVERAGE PRICE of a new cancer drug is $120,000 per year, and immunotherapies are no exception. These prices can be difficult for patients to bear, since even those with insurance must typically pay 20 to 25 percent of those costs out-of-pocket.
→ SOME ONCOLOGISTS and oncology organizations are working to allow stakeholders including the government and patients to have more of a say in what cancer immunotherapies cost.
The authors cited a study that found that Yervoy, at a willingness- to-pay of $146,000 per QALY, was cost-effective for 95 percent of eligible patients compared with best supportive care; however, they noted that the drug’s ICER is “higher than commonly accepted cost-effectiveness thresholds.”
The authors also cited a study that found that Provenge plus standard treatment was not cost-effective at an ICER of $289,964 when compared to standard treatment alone.
With plans afoot for combinations of these drugs with others, and for their extended use in multiple cancers, “overall expenditures on these inhibitors threaten to be unsustainable,” Geynisman and colleagues wrote.
They suggested, however, that prices might drop due to competition among drug makers, clinical trials such as the lung cancer Master Protocol that study a large number of drugs at once, shorter drug-development times due to FDA programs such as the breakthrough designation, the identification of biomarkers that determine which patients will benefit from treatments, and possible reductions in the number or size of doses – for instance, by determining whether or not a tactic like checkpoint inhibition therapy needs to be continued indefinitely.
One thing is certain: As high-cost treatments become standard practice and the proportion of health care resources allocated to these treatments grows, cost-effectiveness of the treatments will need to be transparent to decision-makers. And that includes patients, Geynisman and co-authors assert.
“Concerns of financial and emotional distress from the use of costly new cancer drugs that offer marginal benefits, especially among patients with incurable cancers, have prompted the IOM (Institute of Medicine) Committee on the Quality of Cancer Care to recommend providers to communicate information on both total and out-of-pocket costs with patients and to promote early communications of supportive care,” they wrote.
Oncology Organizations Providing Guidance
Not all cancer drugs are alike, and those with the most value should command the highest prices and the most comprehensive insurance coverage, some in the health care arena contend. Expert panels organized by the American Society of Clinical Oncology (ASCO) have convened to assess value based on a drug’s comparative effectiveness compared to prevailing therapies, while taking into account toxicity and cost.
Richard Schilsky, ASCO’s chief medical officer, explains that “ASCO is trying to stimulate a conversation about value in cancer care and to provide a framework to guide the discussion between doctors and patients about the value of available treatment options.”
Merck is open to the idea.
“This is an important initiative being undertaken by ASCO and it is still under development,” Clyburn said. “We look forward to hearing the outcomes and guidance when they become available.”
Memorial Sloan Kettering Cancer Center acted on advice from a committee of its own doctors in 2012 when it decided not to offer a then-new targeted cancer drug — Zaltrap (ziv-aflibercept), for colorectal cancer — because its price was over $11,000 for a month of treatments and its effectiveness and side effects were similar to those of Avastin (bevacizumab), available at half the price. The drug’s makers, Sanofi and Regeneron, responded by cutting the drug’s price in half.
“If no one else will act, leading cancer centers and other research hospitals should. The future of our health care system, and of cancer care, depends on our using our limited resources wisely,” wrote the doctors, Saltz, Peter B. Bach and Robert E. Wittes, in a New York Times op-ed that year.
The petition Kantarjian is supporting suggests a similar dynamic, with drug prices being set, in effect, by committee. The petition asks that Medicare be allowed to negotiate what it pays for cancer drugs. A 2003 law forbade the agency from negotiating or setting prices or establishing a list of covered drugs. Some, including the National Committee to Preserve Social Security & Medicare, say that lobbying by drug makers helped shape that outcome.
The petition also suggests that, after a drug receives FDA approval, a group of concerned parties, including patients and their advocates, should have a role in estimating a fair market price, and that the nonprofit, non-governmental Patient- Centered Outcomes Research Institute should include recommended prices in its assessments of the value of new cancer drugs. Finally, the petition calls for groups of cancer experts, such as ASCO, to create guidelines for cancer drug pricing relative to treatment value.
They are. In mid-June, the expert panels convened by ASCO debuted a conceptual drug valuation tool focused on gauging the health benefits offered by new treatments in comparison to existing treatments. The tool compares the clinical benefit and toxicity of pairs of regimens that have been examined head-to-head in clinical trials to generate a numeric measurement of “net health benefit.” The cost of the drug regimens is given but not factored into the overall scores.
Doctors from Memorial Sloan Kettering Cancer Center also recently made public a tool for estimating the value of drugs, called DrugAbacus. It estimates fair market prices based on relative values that users ascribe to the toxicity, clinical benefit and novelty of the drugs in question. And the National Comprehensive Cancer Network, which publishes clinical treatment guidelines for various cancer types, has started including “evidence blocks” that rate the affordability of each regimen.
Health insurers should also play a part in determining value, according to Schilsky.
Currently, insurers may ask patients to pay a higher percentage of the cost of cancer immunotherapies just because they are oncology drugs, says Linda House, president of the patient advocacy group Cancer Support Community. But Schilsky argues that the percentage a patient pays should be based on a drug’s effectiveness, not what it treats.
“The concept of value-based insurance dictates that if something is proven useful, offering a substantial improvement, then it should be well reimbursed with minimal to no copays,” he says. “If another therapy is developed that is marginally beneficial, doesn’t produce major improvement, or is associated with significant toxicity, then it may obtain regulatory approval but reimbursement may be at a lower level or it may have a higher copay.”
Struggling to Keep Up
Patients will likely appreciate any changes that allow them to receive effective therapies without a lot of out-of-pocket expenses. At the moment, that kind of balance isn’t always easy to come by.
About 25 percent of patients with cancer reported in 2006 that they had spent all of their savings, or the majority of that money, on their health care, according to the New York Times oped by Bach, Saltz and Wittes. A 2011 study showed that 2 percent of patients with cancer found themselves in bankruptcy due to those expenses, the doctors wrote.
Meanwhile, a recent survey by the Washington, D.C.-based Cancer Support Community, an international nonprofit, found that even more patients with cancer or in remission — nearly two out of five in a study of about 500 — were worried about the prospect of bankrupting themselves or their families as a result of cancer treatment expenses. While respondents weren’t asked if they had been treated with immunotherapy, the survey results can be extrapolated to any patient with cancer who is facing a high-cost intervention, House says.
Of the respondents in the Cancer Support Community survey — mostly insured women with breast cancer — nearly half (47.7 percent) said they had paid more for their treatment over the past 12 months, attributing those added costs to insurance premiums (61.2 percent), deductibles (46.7 percent) and treatment co-pays (45.8 percent).
A series of video interviews accompanying the report showed cancer patients discussing the difficulty of meeting out-ofpocket expenses and the trade-offs they had been forced to make, such as choosing doctors based on co-pays, cutting back on food or activities — including education — to save money, and becoming isolated from family members.
“Even if I starve to death, I will not let go of my insurance. That is my life,” said one woman identified as Mary from Culver City, Calif.
A physician quoted in the video, John D. Sprandio, Sr., a specialist in hematology and oncology based in Philadelphia, said that two of his patients recently had elected not to undergo therapy because of costs.
“People are making decisions like consumers,” he said, “in a situation where the clinical stakes and the potential suffering of patients are substantial.”
Clyburn said that Merck is tuned into that problem.
“While we recognize the most important role we can play is delivering innovative oncology medicines, we are also keenly aware that paying for innovative medicines can be challenging for governments, payers and people with cancer,” he says.
“We share a responsibility to ensure that the people who need these medicines the most have access to them — and are committed to working with the entire cancer community to help people with cancer and their caregivers better navigate their journey. That is also why we invest not only in the continued development of our medicines, but also in the many support programs and services to help ensure that people prescribed Keytruda have access to our medicine.”
Jennifer Kelly Shepphird, Ph.D., and Tony Hagen contributed to this article.
Controlling Your Costs
For those interested in immunotherapy but concerned about the costs, financial help may be available. Here are some resources:
> Cancer Support Community
Cancer Support Community can help patients decide whether to take immunotherapeutic drugs, and direct them to organizations that may help pay for these drugs. Call 888-793-9355.
BMS Access Support
can help patients understand and navigate their insurance coverage for cancer treatment or appeal payer decisions not to provide coverage. It also can refer patients to independent charitable foundations that may be able to provide financial support, including the Bristol-Myers Squibb Patient Assistance Foundation, a charitable organization that provides free medicine to eligible uninsured patients who have an established financial hardship. More information can be obtained by calling 800-861-0048 or by visiting BMSAccessSupport.com.
The BMS co-pay program
helps eligible, commercially insured patients who have been prescribed Opdivo or Yervoy with their co-pays or co-insurance costs. Additional information can be obtained by calling 800-861-0048 or by visiting BMSAccessSupport.com.
The Merck Patient Assistance Program
may provide free Keytruda to U.S. patients who are without insurance coverage, whose insurance does not cover the drug, or who otherwise cannot afford to pay. Patients may qualify if they have a household income of $58,350 or less for individuals, $78,650 or less for couples or $119,250 or less for a family of four.
The Merck Access Program
provides reimbursement support for some patients prescribed Keytruda, helping patients understand and navigate their insurance coverage for the drug. The program can help answer questions about insurance coverage, prior authorization, insurance appeals and direct patient assistance, including co-pay support for eligible patients. This program can also offer information about independent co-pay assistance foundations to which Merck donates, which provide financial assistance to eligible patients who cannot afford their cost-sharing obligations. Each independent foundation has its own independent eligibility criteria and application process. More information is available by calling 855-257-3932 or visiting merckaccessprogram-keytruda.com.
Dendreon’s PROvide program
offers financial assistance for patients who have commercial insurance. Patients who want to apply for this program should call Dendreon ON Call at 877-336-3736. A reimbursement coordinator will provide program information to patients or their providers, and assist with the application process.
For additional resources, visit curetoday.com