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The American Journal of Managed Care December 2018
Feasibility of Expanded Emergency Department Screening for Behavioral Health Problems
Mamata Kene, MD, MPH; Christopher Miller Rosales, MS; Sabrina Wood, MS; Adina S. Rauchwerger, MPH; David R. Vinson, MD; and Stacy A. Sterling, DrPH, MSW
From the Editorial Board: Jonas de Souza, MD, MBA
Jonas de Souza, MD, MBA
Risk Adjusting Medicare Advantage Star Ratings for Socioeconomic Status
Margaret E. O’Kane, MHA, President, National Committee for Quality Assurance
Reducing Disparities Requires Multiple Strategies
Melony E. Sorbero, PhD, MS, MPH; Susan M. Paddock, PhD; and Cheryl L. Damberg, PhD
Cost Variation and Savings Opportunities in the Oncology Care Model
James Baumgardner, PhD; Ahva Shahabi, PhD; Christopher Zacker, RPh, PhD; and Darius Lakdawalla, PhD
Patient Attribution: Why the Method Matters
Rozalina G. McCoy, MD, MS; Kari S. Bunkers, MD; Priya Ramar, MPH; Sarah K. Meier, PhD; Lorelle L. Benetti, BA; Robert E. Nesse, MD; and James M. Naessens, ScD, MPH
Patient Experience During a Large Primary Care Practice Transformation Initiative
Kaylyn E. Swankoski, MA; Deborah N. Peikes, PhD, MPA; Nikkilyn Morrison, MPPA; John J. Holland, BS; Nancy Duda, PhD; Nancy A. Clusen, MS; Timothy J. Day, MSPH; and Randall S. Brown, PhD
Relationships Between Provider-Led Health Plans and Quality, Utilization, and Satisfaction
Natasha Parekh, MD, MS; Inmaculada Hernandez, PharmD, PhD; Thomas R. Radomski, MD, MS; and William H. Shrank, MD, MSHS
Primary Care Burnout and Populist Discontent
James O. Breen, MD
Adalimumab Persistence for Inflammatory Bowel Disease in Veteran and Insured Cohorts
Shail M. Govani, MD, MSc; Rachel Lipson, MSc; Mohamed Noureldin, MBBS, MSc; Wyndy Wiitala, PhD; Peter D.R. Higgins, MD, PhD, MSc; Sameer D. Saini, MD, MSc; Jacqueline A. Pugh, MD; Dawn I. Velligan, PhD; Ryan W. Stidham, MD, MSc; and Akbar K. Waljee, MD, MSc
Currently Reading
The Value of Novel Immuno-Oncology Treatments
John A. Romley, PhD; Andrew Delgado, PharmD; Jinjoo Shim, MS; and Katharine Batt, MD
Provider-Owned Insurers in the Individual Market
David H. Howard, PhD; Brad Herring, PhD; John Graves, PhD; and Erin Trish, PhD
Mixed Messages to Consumers From Medicare: Hospital Compare Grades Versus Value-Based Payment Penalty
Jennifer Meddings, MD, MSc; Shawna N. Smith, PhD; Timothy P. Hofer, MD, MSc; Mary A.M. Rogers, PhD, MS; Laura Petersen, MHSA; and Laurence F. McMahon Jr, MD, MPH

The Value of Novel Immuno-Oncology Treatments

John A. Romley, PhD; Andrew Delgado, PharmD; Jinjoo Shim, MS; and Katharine Batt, MD
This study assesses the value of novel immuno-oncology treatments to society.
ABSTRACT

Objectives: To assess the value to society of improved survival from novel immuno-oncology (I-O) treatments.

Study Design: Case studies of ipilimumab for the treatment of advanced unresectable melanoma and nivolumab for advanced previously treated squamous non–small cell lung cancer (NSCLC).

Methods: Published data and survival analysis were used to estimate survival gains. We valued the gains using an economic model developed for application to discrete changes in life expectancy. We estimated aggregate utilization and value to society using cancer registry data and literature. We assessed the share of social value that flowed to the pharmaceutical manufacturer as sales revenue based on publicly available prices.

Results: For advanced melanoma, our analysis estimated an average real-world life expectancy (discounted at a 3% rate) of 32.4 months with ipilimumab versus 14.2 months with an existing standard of care. Treatment of advanced NSCLC with nivolumab generated a life expectancy of 28.1 months versus 14.3 months with an existing standard of care. Depending on model assumptions, the value of these survival gains ranged from $232,000 to $697,000 for a patient with melanoma and from $180,000 to $586,000 for one with NSCLC. Using a midpoint value to aggregate across treated patients over a 5-year window, the total value to society was estimated at $1.9 billion for ipilimumab in advanced melanoma and $1.7 billion for nivolumab in NSCLC. Less than 30% of the total value flowed to the pharmaceutical manufacturer in the form of profit.

Conclusions: The novel I-O treatments studied here generate substantial survival gains and, thus, social value. Less than half of this value accrued to the pharmaceutical manufacturer as sales revenue.

Am J Manag Care. 2018;24(12):e380-e385
Takeaway Points

Immuno-oncology is a new paradigm in cancer treatment whose value to society is not well understood.
  • Case studies of ipilimumab for melanoma and nivolumab for squamous non–small cell lung cancer point to substantial improvements in life expectancy compared with existing standards of care.
  • The value of these survival gains is substantial.
  • Revenues from sales of these drugs represent only a fraction of their value to society.
For more than 150 years, it has been hypothesized that the human immune system plays an important role in oncogenesis.1,2 As long ago as the 19th century, it was hoped that the immune system could be made to combat the disease, and in this century, the hope of immuno-oncology (I-O) therapy has finally begun to be borne out. The FDA approved ipilimumab in 2011 for the treatment of unresectable or metastatic melanoma.3 This monoclonal antibody inhibits a protein receptor that acts as a brake on immune response and thus promotes the availability of lymphocytes that target and kill cancer cells.4 Since the launch of ipilimumab, several other I-O treatments have been introduced. For example, nivolumab, another monoclonal antibody, came to market in 2014 for the treatment of unresectable or metastatic melanoma and disease progression following ipilimumab and, if BRAF V600–mutation positive, a BRAF inhibitor.5 In 2015, nivolumab was approved in the United States for treating metastatic squamous non–small cell lung cancer (NSCLC) with progression on or after platinum-based chemotherapy.6

In the past, the prognosis for these specific cancers has been quite poor. The advent of I-O treatment offers the prospect of substantial improvements in efficacy and tolerability in cancer care, with early evidence pointing to sizable gains in life expectancy. For example, a recent pooled analysis of long-term survival with ipilimumab for advanced melanoma indicates that roughly 1 of 6 patients can expect to live as long as 10 years, which is a degree of durable survival that borders on a cure for this subgroup of patients.7 Furthermore, I-O treatments may prove efficacious in treating a range of cancers. Nivolumab has been approved in the United States for the treatment of advanced renal cell carcinoma and other cancers,8,9 and as of November 2018, ClinicalTrials.gov reported 654 open studies involving nivolumab.10

Although the clinical promise of I-O treatment is well appreciated, its economic value remains controversial. In the United States, there are acute and growing concerns about the rising costs of both branded and generic drugs and the rising share of national health spending that drugs comprise.11 Costs represent one side of the equation. The economic approach compares costs with benefits in order to ascertain value. In some instances, the high cost of a new therapy may be dwarfed by the substantial benefits that the therapy provides to society in terms of improved outcomes. As an example, first-line treatment of chronic myeloid leukemia with tyrosine kinase inhibitors has been shown to produce survival gains worth $2.6 billion to a cohort of incident patients compared with a treatment cost of just $0.7 billion.12 In another context, the use of statins in cardiovascular care has been found to generate quite substantial value for society.13 At this time, however, evidence on the economic value of I-O treatments is lacking.

The present study investigates the potential of this new treatment paradigm for cancer care to provide value to society, in the sense that the willingness of individuals to pay for the survival gains that come from I-O treatments exceeds their cost. Specifically, this study evaluates 2 case studies, with corresponding analyses, of ipilimumab for the treatment of advanced unresectable melanoma and nivolumab for advanced previously treated squamous NSCLC. To do so, we use the best available evidence to quantify survival gains over an existing standard of care and value the gains based on an economic model developed for application to discrete changes in longevity. We then compare the value of the survival gains to society with the profits received by the pharmaceutical manufacturer.

METHODS

Assessing the value of I-O treatment to society is challenging because this paradigm of cancer treatment is novel and rapidly evolving.1 To develop meaningful insights, this study undertook 2 case studies corresponding to their approved indications: (1) ipilimumab for unresectable or metastatic melanoma and (2) nivolumab for advanced previously treated squamous NSCLC. For simplicity, we will frequently refer to these I-O treatments as ipilimumab for melanoma and nivolumab for NSCLC. These case studies represented relatively old versus new I-O treatments, with more versus less extensive evidence on survival and utilization. It should be noted that for melanoma, combination I-O therapy (nivolumab + ipilimumab) has been approved, but data on survival are relatively limited.14

Each case study involved several analytic steps. First, we characterized the real-world gain in life expectancy that a patient experiences from the I-O treatment. Second, we quantified the value of the survival gain to each patient and the aggregate value of the gains to the patient cohort and society. Finally, we determined the share of social value that flows to pharmaceutical manufacturers in the form of sales revenue. Following is a description of our methods for each step.


 
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