Community oncologists will be at the forefront of using immunotherapies and will need to be strong advocates for greater information and affordability of therapies.
Published Online: February 15, 2017
Sumeet Chandra, MD
Immunotherapy as a treatment modality for cancer has been studied for over 5 decades. However, with the recent surge in new treatment options, immunotherapy seems to have come of age. An increasing number of immunotherapy agents have been approved for multiple tumor types over the past few years, bringing the promise of a more effective and less toxic form of cancer treatment. However, as these agents are increasingly making their way from the bench to the clinic, we as community oncologists will have to learn how costly new immunotherapy agents will be incorporated into the changing reimbursement landscape.
The cost of cancer care in the United States is growing rapidly and currently represents 5% of total healthcare spending.1 Costs are estimated to grow from $158 billion to $173 billion by 2020, reflecting an increase of 27% to 39%. Drug costs are a key driver of oncology spending, including immunotherapy and targeted agents—the per patient per year spending on chemotherapy has increased from 15% to 20%. The response to rising costs by both Medicare and commercial payers has been to explore various payment models including clinical pathways, the oncology medical home model, bundled payments, and the Oncology Care Model. The overhanging question is how will these new and potentially beneficial therapies be incorporated into payment models that are designed to contain the cost of cancer care?
Is QALY the Answer?
There is no question that those of us in community practice have seen some remarkable responses to immunotherapy. Pembrolizumab was first approved in 2015 for the treatment of metastatic melanoma based on improved overall survival (OS) and progression-free survival.2 Subsequently, nivolumab received approval for non–small cell lung cancer (NSCLC), and more recently, atezolizumab received approval for platinum-resistant metastatic bladder cancer, also based on significant survival benefit. The cost of pembrolizumab before discount is $12,500 per patient per month or approximately $150,000 per year. Similarly, both nivolumab and atezolizumab cost approximately $150,000 per year.3
The Institute for Clinical and Economic Review (ICER) recently evaluated the cost effectiveness of all 3 approved immunotherapies targeting programmed death-1 (PD-1; nivolumab) or programmed death-ligand 1 (PD-L1; pembrolizumab and atezolizumab).4 The report, which analyzed the clinical benefit of each drug against cost and health-system affordability, found that that a “substantial minority” of patients had gained clinical benefit, but for those patients who did respond, there was a substantial improvement in OS. In terms of cost effectiveness, ICER estimated that atezolizumab cost $219,179 per quality-adjusted life year (QALY) gained, pembrolizumab cost $240,049, and nivolumab $415,950. The report placed a benchmark of $100,000 to $150,000 per QALY. To reach this benchmark, ICER estimated that atezolizumab would require a reduction in its wholesale acquisition price (WAC) of 31% to 53%. For pembrolizumab, the WAC would require a reduction of 39% to 61%, and nivolumab would require a reduction of 57% to 68%.
How do we as community oncologists manage the financial burden of these costly medications in our current buy-and-bill model? The current unit cost for pembrolizumab is $4650, and for nivolumab it is $3000. As community practitioners, we need to be very diligent about obtaining preauthorization and documentation to ensure timely payment. As the indications for immunotherapies expand, the financial burden on practices is expected to substantially increase. The out-of-pocket costs associated with these treatments can also be prohibitive for many patients. Practices will need a robust financial assistance program to help with patient copayments, either through foundation programs or through the pharmaceutical companies themselves.
Bristol-Myers Squibb started a direct-to-consumer marketing campaign for nivolumab, in 2015, that has cost approximately $125 million.5 The drug maker has stated that this aggressive direct-to-consumer approach is a way to facilitate discussions regarding immunotherapies between healthcare providers and patients.5 This approach by the company has received a fair amount of criticism from academic and community oncologists, as well as patient advocates. We have definitely noticed the effects of this marketing campaign in our practice. In our experience many patients have a misconception that these therapies represent a “miracle cure.” Marketing campaigns have certainly influenced patient opinions about immunotherapy. As a community oncologist, the onus is on us to temper patient expectations about these treatments and also to bring up cost-benefit discussions with patients.
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