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The American Journal of Managed Care December 2018
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
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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
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The Value of Novel Immuno-Oncology Treatments
John A. Romley, PhD; Andrew Delgado, PharmD; Jinjoo Shim, MS; and Katharine Batt, MD
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David H. Howard, PhD; Brad Herring, PhD; John Graves, PhD; and Erin Trish, PhD

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):In Press

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