The impact of pricing strategy on the costs of oral anti-cancer drugs.

BACKGROUND: The soaring costs of anti-cancer drugs pose a threat to the sustainability of cancer care. The pricing strategy chosen by manufacturers can impact the costs of oral anti-cancer drugs during dose modifications, but this issue remains under-recognized in the literature. In general, with the flat pricing strategy, there is a single fixed price for each tablet regardless of dosage strength, whereas with linear pricing, the price of each tablet increases with its dose. We hypothesize that flat pricing will have increased drug costs compared to linear pricing during dose reductions since the cost remains fixed despite decreased dose requirements. This practice may have significant financial implications considering the high costs, extensive utilization, and frequent occurence of dose reductions with anti-cancer drugs.  METHODS: Oral anti-cancer drugs reviewed by the pan-Canadian Oncology Drug Review program between 2011 and 2018 were identified. The cost per mg and cost per 28-day cycle were calculated for dose levels -2 to +2. The percent change in cost per mg and cost per cycle during dose modifications from the standard dose were calculated. We conducted Mann-Whitney U and Fisher-exact tests to compare the association between drug costs during dose reductions and pricing strategy. RESULTS: In this study, 30 oral anti-cancer drugs for use in 41 indications were analyzed; 44% of drugs used linear pricing and 56% used flat pricing. Dose reductions increased the mean cost per mg for drugs with linear pricing by 14.7% (range: 0%-50%) at dose level -1 and 17.2% (range: 0%-50%) at dose level -2 and flat pricing by 60.8% (range: 19%-100%) at dose level -1 and 99.1% (range: 0%-300%) at dose level -2. The cost per mg was significantly increased in drugs using flat pricing compared to linear pricing when dose reduction to either level -1 (P = 0.010) or level -2 (P = 0.006) occurred. The mean cost per cycle was decreased for drugs using linear pricing by 20.9% (range: -40% to 0%) at dose level -1 and 48.7% (range: -60% to -25%) at dose level -2 and flat pricing by 0.8% (range -6% to 0%) at dose level -1 and 11.0% (range: -50% to 100%) at dose level -2. The cost per cycle was significantly decreased in drugs with linear pricing compared to flat pricing when the standard dose is reduced to either dose level -1 (P = 0.005) or dose level -2 (P = 0.026). CONCLUSIONS: Overall, flat pricing had significantly greater costs compared to linear pricing during dose reductions of anti-cancer drugs. While there is a general expectation that the cost of drugs should decrease with dose reduction, drugs with flat pricing were generally found to have increased cost per mg and no change in the cost per cycle. The resultant increased spending on drug acquisition (despite purchasing lower doses) lead to financial wastage, which has significant implications on cost-effectiveness considerations and budgets. Future economic evaluations should take into consideration the hidden costs associated with dose reductions of flat priced drugs.

The impact of cancer drug wastage on economic evaluations.

BACKGROUND: The objective of this study was to determine the impact of modeling cancer drug wastage in economic evaluations because wastage can result from single-dose vials on account of body surface area- or weight-based dosing. METHODS: Intravenous chemotherapy drugs were identified from the pan-Canadian Oncology Drug Review (pCODR) program as of January 2015. Economic evaluations performed by drug manufacturers and pCODR were reviewed. Cost-effectiveness analyses and budget impact analyses were conducted for no-wastage and maximum-wastage scenarios (ie, the entire unused portion of the vial was discarded at each infusion). Sensitivity analyses were performed for a range of body surface areas and weights. RESULTS: Twelve drugs used for 17 indications were analyzed. Wastage was reported (ie, assumptions were explicit) in 71% of the models and was incorporated into 53% by manufacturers; this resulted in a mean incremental cost-effectiveness ratio increase of 6.1% (range, 1.3%-14.6%). pCODR reported and incorporated wastage for 59% of the models, and this resulted in a mean incremental cost-effectiveness ratio increase of 15.0% (range, 2.6%-48.2%). In the maximum-wastage scenario, there was a mean increase in the incremental cost-effectiveness ratio of 24.0% (range, 0.0%-97.2%), a mean increase in the 3-year total incremental budget costs of 26.0% (range, 0.0%-83.1%), and an increase in the 3-year total incremental drug budget cost of approximately CaD $102 million nationally. Changing the mean body surface area or body weight caused 45% of the drugs to have a change in the vial size and/or quantity, and this resulted in increased drug costs. CONCLUSIONS: Cancer drug wastage can increase drug costs but is not uniformly modeled in economic evaluations. Cancer 2017;123:3583-90. © 2017 American Cancer Society.

Methodological Issues in Economic Evaluations Submitted to the Pan-Canadian Oncology Drug Review (pCODR).

BACKGROUND: Public drug plans are faced with increasingly difficult funding decisions. In Canada, the pan-Canadian Oncology Drug Review (pCODR) makes funding recommendations to the provincial and territorial drug plans responsible for cancer drugs. Assessments of the economic models submitted by pharmaceutical manufacturers are publicly reported. OBJECTIVES: The main objective of this research was to identify recurring methodological issues in economic models submitted to pCODR for funding reviews. The secondary objective was to explore whether there exists any observed relationships between reported methodological issues and funding recommendations made by pCODR's expert review committee. METHODS: Publicly available Economic Guidance Reports from July 2011 (inception) until June 2014 for drug reviews with a final funding recommendation (N = 34) were independently examined by two authors. Major methodological issues from each review were abstracted and grouped into nine main categories. Each issue was also categorized based on perception of the reviewer's actions to manage it. RESULTS: The most commonly reported issues involved costing (59% of reviews), time horizon (56%), and model structure (36%). Several types of issues were identified that usually could not be resolved, such as quality of clinical data or uncertainty with indirect comparisons. Issues with costing or choice of utility estimates could usually be addressed or explored by reviewers. No statistically significant relationship was found between any methodological issue and funding recommendations from the expert review committee. CONCLUSIONS: The findings provide insights that can be used by parties who submit or review economic evidence for continuous improvement and consistency in economic modeling, reporting, and decision making.

Comparing assessment frameworks for cancer drugs between Canada and Europe: What can we learn from the differences?

The increasing burden of costs associated with novel cancer therapies is becoming untenable. In Europe and Canada, assessment frameworks have been developed to attribute value to novel therapies and ultimately facilitate access to cancer drug funding. A review of the two frameworks has not previously been undertaken. This review provides insight into the relative strengths and benefits of each approach, the various perspectives of value (patient, physician and societal) and how the frameworks relate to their unique context and core principles. Both frameworks assess the clinical benefit of a new cancer therapy. The European framework considers effectiveness, quality of life, and toxicity in its determination of benefit and has the advantage of providing a simple summary score to facilitate priority setting. The Canadian framework considers other elements including cost-effectiveness, patient preferences and adoption feasibility; its deliberative framework precludes a simple summative presentation of value but can address complex and nuanced drug funding considerations with flexibility. Both frameworks have evolved to meet the needs unique to their jurisdictions and offer potentially complementary tools in the assessment of new cancer drugs. Lessons learnt in both systems can be applied to future iterations of the frameworks, which remain works in progress.

Public engagement in priority-setting: results from a pan-Canadian survey of decision-makers in cancer control.

Decision-makers are challenged to incorporate public input into priority-setting decisions. We conducted a pan-Canadian survey of decision-makers in cancer control to investigate the types of evidence, especially evidence supplied by the public, that are utilized in health care priority-setting. We further examined how normative attitudes and contextual factors influence the use of public engagement as evidence at the committee level. Administered between November and December 2012, 67 respondents from 117 invited individuals participated in the survey. The results indicated that public engagement was infrequently utilized compared to clinical effectiveness evidence or cost evidence. General positive agreement between normative attitudes towards the use of evidence and the frequency of evidence utilization was observed, but absence of correlative agreement was found for the types of evidence that are supplied by the general public and for cost-effectiveness inputs. Regression analyses suggested that public engagement was unevenly utilized between jurisdictions and that educational background and barriers to implementing public input may decrease the odds of using public engagement as evidence. We recommend that institutions establish a link between committee members' normative attitudes for using public engagement and its real-world utilization.

An evaluation framework for funding drugs for rare diseases.

OBJECTIVES: For rare diseases it may be difficult to generate data from randomized trials to support funding of a drug. Enzyme replacement therapies for diseases of inherited metabolic enzyme deficiency provide an example of this dilemma. The Ontario Public Drug Programs convened the Drugs for Rare Diseases Working Group to develop a policy for assessing these drugs. METHODS: The Drugs for Rare Diseases Working Group developed terms of reference expecting that the ideal policy product would be transparent and consistent and address unique aspects of the treatment of a specific rare condition while being adaptable to other dissimilar conditions. The perspective was that of a public payer addressing requests for funding generated for a specific drug, and included respect for the principles of "accountability for reasonableness" of Daniels and Sabin. RESULTS: A seven-step framework was developed and tested by using the case study of idursulfase for mucopolysaccharidosis II (Hunter disease). Estimation of clinical effectiveness was done by using decision modeling. The model developed informed funding recommendations and ultimately led to an agreement with the manufacturer allowing funding of idursulfase in Ontario. CONCLUSIONS: This policy framework attempts to address the policy challenges of funding drugs for rare diseases. The framework will be used to assess other drugs in future and will inevitably require modification with experience. It is hoped that it may be of value to other policymakers.