Advancing Health Economics, Services, Policy and Ethics

WHERE NEXT FOR ECONOMIC AND COMPARATIVE EFFECTIVENESS EVIDENCE IN AN ERA OF PERSONALIZED/ PRECISION MEDICINE

Stuart PeacockCanadian Centre for Applied Research in Cancer ControlUniversity of British ColumbiaBritish Columbia Cancer Agency

• A little bit about the Canadian Centre for Applied Research in Cancer Control (ARCC)

• Why is economic evidence important?• Economic evidence – a personalized medicine case

study in colorectal cancer• Some challenges ahead relating to personalized

medicine amongst other things• The importance of preferences as part of evidence

Overview

How can we inform and promote cancer control policies and practices (from prevention to palliative

care and survivorship) that are evidence-based, sustainable and ethical in order to reduce the burden

of cancer for Canadians?

5

ARCC - the big question?

How do you answer the big question?

• In the mid-2000s, the Canadian Cancer Society committed to invest in a national centre dedicated to health economics, services, policy and ethics in cancer control

• Identified a need for an organization that both– brings together these multiple disciplines to address

cancer control questions and– provides national leadership in research, knowledge

translation and capacity building in this area

6

• Interdisciplinary, inter-provincial and inter-professional with a commitment to cross-national collaboration

• ARCC is an unique partnership of 30 investigators, 30 associates and over 40 research staff from across Canada

• Two leadership hubs at the British Columbia Cancer Agency (BCCA)/University of British Columbia (UBC) and at Cancer Care Ontario (CCO)/University of Toronto (U of T)

7

Centre Approach

• Five thematic program areas:

8

Research

ARCC

Health Technology Assessment

Patients and Families

Societal Values and Public Engagement

Knowledge Translation

Health Systems, Services and Policy

Pan-Canadian Network

“Allocation of funds and facilities are nearly always based on the opinion of consultants but, more and more, requests for additional facilities will have to be based on detailed

arguments with ‘hard evidence’ as to the gain to be expected from the patient’s angle and the cost. Few could

possibly object to this.”

Cochrane AL. Effectiveness and Efficiency: random reflections on health services. Nuffield Provincial

Hospitals Trust, London, 1972.

Why is economic evidence important?

Oncology drugs in British Columbia

$0$20,000,000$40,000,000$60,000,000$80,000,000

$100,000,000$120,000,000$140,000,000$160,000,000$180,000,000$200,000,000

28%19% 9%

19%22%

11%14%

14%

16%

15%

12

Col-orectal

Lung Breast Prostate All sites$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

200220032004200520062007

Mea

n co

st p

er c

hem

o us

erMean cost by year and site

Monthly and median costs of FDA approved cancer drugs (2007 US$)

AldesleukinNelarabine

Denileukin

Alemtuzumab

Cetuximab

Source: Bach, NEJM 2009

Why is economic evidence important?

Safety Cost-Effectiveness

QualityEfficacy

The Fourth Hurdle

Economic evaluation for reimbursement decisions

• Many jurisdictions now require economic evaluation for reimbursement decisions (primarily for drugs)– Accompanied by guidelines for pharmaceutical companies– Pricing decisions maybe linked with reimbursement decisions

• Australia: Pharmaceutical Benefits Advisory Committee (PBAC)

• England and Wales: National Institute for Health and Clinical Excellence (NICE)

• Based on ‘Acceptable’ Incremental Cost-Effectiveness Ratios (ICERs)

Economic Evaluation in EuropeNorway:Pharmacoeconomic datarequired for reimbursement; official guidelines in operation.

Finland:Pharmacoeconomic evidence mandatory for evaluating newtherapies for reimbursement and may also be requested for existing therapies.

Sweden:Cost-effectiveness data required for reimbursement.

Denmark:Cost-effectiveness data may be requestedfor reimbursement decisions.

Britain:NICE evaluates the cost effectiveness of medicines. Guidelines updated April 2004.

Germany:Guidelines prepared. Institute for Quality and Efficiency in the Health Service established in 2004.

France:Not a formal requirement but increasingly used in reimbursement decisions. Guidelines prepared.

Spain:Health technology assessment at a regional level.

Portugal:Cost-effectiveness data incorporated into reimbursement decisions.

Italy:Cost-effectiveness considered in pricing and reimbursement decisions. Greece: Guidelines for pharmacoeconomic studies

prepared; cost-effectiveness data may be requested.

Belgium: Formal requirement for economic evaluation.

Netherlands:Pharmacoeconomic evidence explicitly required for reimbursement of new products.

Ireland: Guidelines for pharmacoeconomic studies prepared; cost-effectiveness data may be requested.

Source: National Centre for Pharmacoeconomics, Ireland

Health economic evaluation

Target patient group

Survival Quality of lifeNew Program

Old Program

Impact on health status

Impact on health care costs

Impact on health status

Impact on health care costs

Survival Quality of life

Hospitalisations Drugs, procedures etc.

Hospitalisations Drugs, procedures etc.

Incremental Cost-Effectiveness Ratio (ICER)

(Costnew – Costold)

(Effectivenessnew – Effectivenessold)

Incremental resources required by the intervention

Incremental health effects gained by using

the intervention

ICER = C / E

= ICER

Number Incremental cost per additional life-year gained at 1998/1999 prices ($AU)

PBAC decision

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

22

21

22

23

24

25

5517

8374

8740

17387

18762

18983

19807

22255

26800

38237

39821

42697

43550

43550

56175

57901

63703

71582

75286

85385

88865

98323

229064

231650

256950

Recommend at price

Recommend at price

Recommend at price

Recommend at price

Recommend at price

Recommend at price

Recommend at lower price

Recommend at price

Recommend at price

Recommend at price

Recommend at price

Reject

Reject

Recommend at price

Reject

Recommend at price

Reject

Recommend at price

Recommend at price

Recommend at lower price

Reject

Reject

Recommend at lower price

Reject

Reject

Source: George et al. Pharmacoeconomics 2001

ICER thresholds and the Australian PBACICER thresholds in Australia

Source: Rawlings. Lancet Oncology 2007

Cancer ICER thresholds in England and Wales

E and C 1994-2008 FDA Pivotal Trials

21

22

E and C 1994-2008 FDA Pivotal Trials

A personalized medicine case study: Cetuximab (Erbitux) in advanced

colorectal cancer (CRC)

• Treatment for advanced colorectal cancer (CRC) – improves overall and progression-free survival compared to best supportive care1

• Mechanism of action - monoclonal antibody that targets epidermal growth factor receptor (EGFR), modulating tumor cell growth2

• Resistance to cetuximab is common (>50% after one treatment) - Caused by mutations in component of EGFR: K-ras protein, which occur in ~40% of patients3

Cetuximab in Advanced Colorectal Cancer

Cetuximab in Advanced Colorectal Cancer

Effectiveness of cetuximab (overall and progression-free survival) is significantly associated with k-ras mutation status (p>0.001) - Patients with wild-type k-ras tumors did benefit (overall survival 9.5 months) - Patients with mutated k-ras tumors did not benefit (overall survival 4.8 months)3

Source: Karapetis et al, NEJM, 2009

Cost-effectiveness– Cetuximab may increase the already significant

cost of managing advanced CRC, especially when provided to all patients

– Drug and administration cost of cetuximab $71,000/patient4

– K-ras testing $450/patient4

Cetuximab in Advanced Colorectal Cancer

Cost-effectiveness cont…– Providing drug to all patients is not cost effective– Incremental cost effectiveness ratio (ICER) ~$300,000 per

QALY gained5

– Targeting the therapy to patients with wild-type k-ras improves cost-effectiveness

– ICER ~$180,000/QALY5

– Theoretical cost-savings associated with treating only wild-type k-ras, $740 million (US), accounting for cost of k-ras testing

Cetuximab in Advanced Colorectal Cancer

Some challenges ahead

• Current reimbursement systems for diagnostic tests are cost based rather than value based

• Tests for multiple markers cost thousands of dollars• Technology is changing – cost per single-nucleotide

polymorphism (SNP) analyzed is falling rapidly• True opportunity cost is often unknown – testing may

result in changes to medical utilization• Difficult to estimate a true economic value at any

given time

Identifying the costs of testing strategies

• Genetic tests share the same concerns about sensitivity and specificity as older diagnostics

• But, we have many years of experience modeling screening interventions

• Patient outcomes are likely to be influenced by multiple genes, and each gene can influence multiple outcomes

• Each outcome is modified by interactions with other genes and environmental exposures – including diets, drugs and disease states

Sensitivity, specificity and complexity

• Lack of data on patient and clinician behaviour following the results of diagnostic tests, and associated patient outcomes

• Issue gets more complicated if the test indicates a patient should not get a drug

• Are there alternatives? • If so, how does the analysis factor in the timing and

sequencing of alternatives?

Lack of effectiveness data

• Inconclusive or contradictory results from small (n < 200) RCTs may be insufficient for robust estimates of effectiveness

• More decision analytic modelling required, with careful consideration of parameter and decision uncertainty

• Use of surrogate end-points, e.g. progression free survival, is likely to increase

• Cumulative synthesis of RCTs needed

Lack of effectiveness data cont …

• Uncertainty with the clinical value of new technologies will likely mean that the value of additional research and policy options, such as CED, should be considered

• CED = provisional approval for coverage by payers on condition that additional data on effectiveness are collected through RCTs or patient registries

• Registries and linkable administrative data sets will only become more important

Coverage with evidence development (CED)

• Is personalized medicine more likely to lead to smaller and smaller sub-group analyses rather than ‘individualized’ care?

• Possibly, because the marginal cost of developing new drugs will outweigh the marginal benefits for pharmaceutical companies

• RCTs and economic evaluation will not become redundant – but they will be more complex and costly

• Linkable administrative data will be very important

Personalized vs. stratified medicine

• Personalized medicine promises to provide tailored therapies that take into account individual differences in risk and values

• The balance of risks and benefits for each person will differ because of preference heterogeneity

• Tailoring therapy and determining the optimal strategy will mean listening to patients preferences

• Economic evaluations need to model patient preferences about different treatment options

Preferences and personalized medicine

• PSA screening appears to prolong life expectancy but shortens quality-adjusted life expectancy i.e. it is a preference sensitive decision

• Men who receive decision support are more knowledgeable, have less decisional conflict, and are less inclined to undergo PSA screening

• Sexual and urinary dysfunction after treatment have modest effects on global quality of life

• Men with low literacy do not understand many prostate cancer terms

• Preferences should be part of guideline development (Krahn and Naglie, JAMA 2008)

Preferences count in many circumstances

36

• ... on inflating community expectations

A cautionary tale ...

At the February 1, 2012 data cut-off, median follow-up was 12.5 months for vemurafenib and 9.5 months for dacarbazine. In patients not censored at crossover, median OS was 13.6 months for vemurafenib vs. 10.3 months for dacarbazine (HR 0.76; P<0.01 post-hoc). In those censored at crossover, OS was 13.6 months for vemurafenib and 9.7 months for dacarbazine (HR 0.76; P<0.001 post-hoc). (BRIM3 Trial presentation at ASCO 2012)

Inflating community expectations

40

A d v a n c i n g H e a l t h Ec o n o m i c s , S e r v i c e s , Po l i c y a n d E t h i c s

Acknowledgements

ARCC is funded by the Canadian Cancer Society

Email: speacock@bccrc.caARCC website: www.cc-arcc.ca