Debating Value Versus Cost for Immunotherapy

Meir Rinde
Published: Wednesday, May 16, 2018
Joseph Alvarnas, MD
Joseph Alvarnas, MD
The high costs of cancer drugs have drawn criticism and scrutiny for a number of years, but sticker shock reached a new level recently over the price tags attached to the first of what are expected to be a growing number of chimeric antigen receptor (CAR) T-cell therapies. Up-front prices are approaching $500,000 for a 1-time treatment.

Economic analyses suggest that the high costs are justified once the survival rates, durability, and quality of life the therapies provide are taken into account. Similar studies of checkpoint inhibitors and other immunotherapy drugs, which can cost more than $100,000 per patient per year, have also concluded that their prices are often appropriate given their efficacy.

In some situations, however, the costs of new therapies are so high that they have been judged unreasonable for the benefits provided or they threaten to cause unacceptably large increases in national healthcare spending. Globally, several countries regularly use cost-benefit analyses to determine if and when their healthcare systems will pay for expensive therapies. The United States does not. Concern over the costs of immunotherapies and access to new cancer drugs is now contributing to increasingly urgent calls for adoption of universally accepted value frameworks in this country.

In March, the President’s Cancer Panel issued a report acknowledging the financial toxicity associated with cancer care across the spectrum of treatments and suggesting potential remedies (Figure 1).1 Topping the list is the need to develop a framework with which to evaluate anticancer therapies that takes into consideration information on clinical outcomes, toxicities, impact on quality of life, and costs.

Drug prices “often do not reflect the benefits experienced by patients. Steps must be taken to better align drug prices and costs with their value. Achieving better alignment could improve the quality of cancer care; create incentives for development of innovative, effective new drugs; and help address increases in drug spending that are threatening to put high-value drugs out of reach for some patients,” the report said. “Developing and implementing a widely accepted value framework for cancer drugs is a critical step toward value-based pricing.”

Studies Analyze CAR T-Cell Therapies

Since a key component of any value equation is the effectiveness of the treatment being evaluated, the 2 FDA-approved CAR T-cell therapies have fared well in early analyses despite their high price tags.

Figure 1. Key Component sin Pricing Equation1

Last August, the FDA granted the first approval for tisagenlecleucel (Kymriah) for treating patients up to age 25 years with B-cell precursor acute lymphoblastic leukemia (B-ALL) that is refractory or in a second or later relapse. Novartis announced a $475,000 price tag; with hospital markup, preparatory chemotherapy, management of adverse events and other factors, the total cost of treatment could reach $1.5 million per patient.2 The company established an outcome-based payment arrangement for Medicare and Medicaid patients, under which CMS won’t pay for patients who do not respond in the first month of treatment. In January, the FDA additionally granted a priority review for tisagenlecleucel for adults with relapsed/refractory diffuse large B-cell lymphoma who are ineligible for or who have relapsed after autologous stem cell transplant (SCT).

The second CAR T therapy, axicabtagene ciloleucel (axi-cel; Yescarta), was approved in October for the treatment of adult patients with relapsed or refractory large B-cell lymphoma after at least 2 lines of systemic therapy. Gilead/Kite Pharma set the price at $373,000. As with tisagenlecleucel, total treatment costs can far exceed the sticker price.

The drugmakers and CAR T advocates argue the prices are justified given the need to produce custom engineered T cells for each patient and the therapies’ striking effectiveness for children and adults who otherwise face poor prognoses. A new analysis by the Institute for Clinical and Economic Review (ICER) endorses the cost-effectiveness of the 2 treatments, projecting that the costs per quality-adjusted life years (QALYs) over patients’ lifetimes will come in below commonly accepted dollar thresholds in most scenarios.3

“With the caveat that we’re basing this on some very early survival data, we feel that both the substantial gains in life expectancy and quality of life, as well as cost differences against another active agent that are not as great, yield a cost-effective result,” said Dan Ollendorf, PhD, chief scientific officer for ICER, in an interview with OncologyLive®.

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