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The American Journal of Managed Care May 2019
Evaluation of Value-Based Insurance Design for Primary Care
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Daniel B. Wolfson, MHSA
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Cost-Effectiveness of DPP-4 Inhibitor and SGLT2 Inhibitor Combination Therapy for Type 2 Diabetes
Manjiri Pawaskar, PhD; S. Pinar Bilir, MS; Stacey Kowal, MS; Claudio Gonzalez, MD; Swapnil Rajpathak, MD; and Glenn Davies, DrPH
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Cost-Effectiveness of DPP-4 Inhibitor and SGLT2 Inhibitor Combination Therapy for Type 2 Diabetes

Manjiri Pawaskar, PhD; S. Pinar Bilir, MS; Stacey Kowal, MS; Claudio Gonzalez, MD; Swapnil Rajpathak, MD; and Glenn Davies, DrPH
This study evaluates the long-term cost-effectiveness of treatment involving combination therapy with dipeptidyl peptidase 4 (DPP-4) inhibitors and sodium-glucose cotransporter 2 (SGLT2) inhibitors compared with an alternative with sulfonyureas prior to insulin initiation on a background of metformin.

Results of base-case and scenario analyses demonstrate that for patients who are not at their A1C goal on metformin, intensification with DPP-4 inhibitors (second line) followed by addition of SGLT2 inhibitors (third line) on a background of metformin may be considered cost-effective compared with a more generic treatment strategy with metformin + SU prior to insulin initiation, with an ICER well under $100,000/QALY. Although the addition of costlier branded oral medications after metformin failure increased direct medical costs in pathway 1, the health benefits associated with pathway 1 medications partially offset treatment costs, improving life expectancy and quality of life over a patient’s lifetime.

With all scenarios demonstrating cost-effectiveness relative to willingness-to-pay thresholds, results are robust to alternate assumptions. Notably, the base-case analysis did not incorporate the potential cardiovascular protective effects of adding an SGLT2 inhibitor as documented in multiple clinical trials,16,21,22 yet scenarios incorporating cardioprotective effects further improved QALYs and lowered total costs to the point of reducing ICER results to below $50,000/QALY. Most other scenarios remained similar to the base case; the exceptions were those that led to limited duration of therapy, such as starting at a higher baseline A1C level, such that the benefits outweighed the costs accrued. This and other scenarios reinforce the conclusion that use of relatively new branded medications that rely on novel mechanisms of action may provide long-term benefits compared with traditional generic therapies. When additionally accounting for the range of price discounts that are commonly negotiated between payers and manufacturers on branded medications, ICERs fell close to $50,000/QALY with 25% discounts and as far as $36,201/QALY with 50% discounts, thereby indicating that pathway 1 is highly cost-effective compared with pathway 2 according to any willingness-to-pay threshold typically considered in the United States.32

To the authors’ knowledge, no economic evaluation has been performed to assess the cost-effectiveness of specific sequential treatment pathways, and the multiple intensification steps included in this analysis limit comparability with other publications. As noted in a review of diabetes-related cost-effectiveness publications, nearly all studies have evaluated the cost-effectiveness of a single intervention, whereas in the real world, patients will receive multiple interventions over a lifetime, both sequentially and simultaneously as suggested in guidelines.9,47 However, it is possible to consider the results of this analysis given the general literature on cost-effectiveness thresholds. ICERs are often evaluated relative to willingness-to-pay thresholds, and although $50,000/QALY or $100,000/QALY is often used as a point of comparison, the rationale is outdated.32 The World Health Organization’s WHO-CHOICE program suggests that 2 to 3 times the national gross domestic product would be appropriate in developed countries (approximately $115,000-$172,000),32 and alternate suggested values have ranged between approximately $110,000/QALY and close to $300,000/QALY.31,48,49 The present analysis results can be interpreted as falling under those suggested values and thus indicate that it represents good value for money.


Although the results of this analysis are robust, it does have some limitations to consider. When initiating insulin, it is assumed that patients drop SGLT2 inhibitors and thus do not continue to receive the benefits of potential weight loss and CVD protection associated with those medications. This was done due to lack of clinical data regarding the effects of combination therapy including metformin + DPP-4 inhibitor + SGLT2 inhibitor + basal insulin. Omitting the potential long-term benefits may also be offset by eliminating the associated long-term medication costs. The analysis was also simplified by assuming that insulin dosage within each line of therapy remained constant. This simplification was also used due to lack of additional data to inform changes over time. However, because any insulin change would apply to both strategies equally, the incremental results are anticipated to remain similar and thus have limited impact on study conclusions. Additionally, a less costly option among several rapid-acting forms of bolus insulin was selected as a proxy for this last line of therapy in both pathways. This assumption was considered conservative, as it limits cost offsets due to delaying the basal-bolus line of therapy and thus removes any potential bias associated with adding a step into the treatment pathway.

Another point of consideration is that this analysis did not incorporate certain potential adverse event differences. For instance, this analysis did not include costs related to infrequent adverse events that may be associated with some of the drugs in the SGLT2 inhibitor class, such as diabetic ketoacidosis or amputations,16 as these would have limited impact on analytic results. No association was incorporated between hypoglycemic events and other downstream complications, such as cardiovascular events, although recent study results have indicated a potential link between these events.50,51 Adding this relationship would only improve an already cost-effective result. Finally, no association between A1C treatment switching threshold and potential mortality (eg, if it is aggressive for some subgroups) was implemented; however, this was not required in the deterministic base-case analysis, as the threshold was appropriate for the cohort average.


Despite its limitations, by estimating lifetime direct medical costs and clinical outcomes of potential therapeutic pathways, this study improves on available information regarding the potential economic value of different treatment strategies that could be used for management of T2D. Specifically, this analysis shows that additional anticipated long-term health benefits of a sequential pathway with branded oral medication including DPP-4 inhibitors and subsequent addition of SGLT2 inhibitors prior to insulin initiation provides acceptable value relative to costs compared with a generic treatment pathway of metformin with SU and insulin in the United States.

Author Affiliations: Merck & Co, Inc (MP, CG, SR, GD), Kenilworth, NJ; IQVIA, Inc (SPB, SK), San Francisco, CA.

Source of Funding: Merck & Co.

Author Disclosures: Drs Pawaskar, Rajpathak, and Davies are employed by and own stock in Merck. Ms Bilir is employed by IQVIA, which was paid for this research. Ms Kowal is employed by IQVIA and was paid by Merck to conduct the full modeling study, which included manuscript development. Dr Gonzalez is an employee of Merck, which developed and commercializes a dipeptidyl peptidase 4 inhibitor.

Authorship Information: Concept and design (MP, SPB, SK, SR, GD); acquisition of data (SPB, CG); analysis and interpretation of data (MP, SPB, SK, CG, SR, GD); drafting of the manuscript (MP, SPB, SR, GD); critical revision of the manuscript for important intellectual content (MP, SPB, SK, CG, GD); statistical analysis (MP); obtaining funding (SR); administrative, technical, or logistic support (SK, GD); and supervision (MP, GD).

Address Correspondence to: S. Pinar Bilir, MS, IQVIA, 135 Main St, Floors 21 and 22, San Francisco, CA 94015. Email:

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