Download A Case for Market-Based Costs in Determining Cost

A Case for Market-Based Costs in
Determining Cost-Effectiveness: The
Hepatitis C Example
Avalere Health | An Inovalon Company
November 2015
Executive Summary
HCV CostEffectiveness
Studies
• Studies assessing newer HCV agents generally
demonstrated cost-effectiveness even though
they use the medications’ list prices
Marketplace
Realities
• The market has produced significant publicly
reported discounts that have not been factored
into most analyses
Best Practice
Costing
Methodology
• Accounting for these marketplace realities, a
best practice recommended by ISPOR Task
Force guidelines, would more accurately
measure cost-effectiveness
HCV: Hepatitis C Virus
ISPOR: International Society for Pharmacoeconomics and Outcomes Research
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Background
FDA has approved several direct-acting antiviral medications since 2013
The medications are associated with a high clinical cure rate, but carry a
relatively high cost
Cost-effectiveness research seeks to assess the value of new medications
in light of the higher costs at launch of innovative drugs
Cost-effectiveness models in HCV may be particularly sensitive to how
costs of the newer medications are defined
The costing exercise can be complex and can involve a variety of
assumptions about the market dynamics of the newly marketed drug
FDA: U.S. Food and Drug Administration
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Research Objectives
1
Summarize the results of recently published U.S. HCV costeffectiveness studies examining the new direct-acting
antivirals from the payer perspective
2
Determine the extent to which the models integrated
established methodological guidelines1 for utilizing marketbased pricing rather than published list prices
1 International Society for Pharmacoeconomics and Outcomes Research (ISPOR) Task Force for Good Research
Practices published guidelines on use of drug costs in cost-effectiveness analyses suggest that cost-effectiveness
analyses performed from a payer perspective should use drug prices actually paid by the relevant payer net of all
rebates, copays, other adjustments.
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Results Indicate a General Trend of CostEffectiveness for the Newer HCV Treatments
INDICATES GOOD VALUE UNDER GENERALLY-ACCEPTED THRESHOLDS
Identified Articles, Abstracts, and
HTAs by Genotype Focus (N=7)
● Sofobuvir-based regimes were
most commonly assessed – while
paritaprevir/ritonavir/ombitasvir,
dasabuvir, and daclatasvir were
also examined
● Five studies measured costs and
benefits over a lifetime horizon,
while two studies utilized a oneyear time horizon
Genotype 1
Gentoype 1-4
Genotype 2-3
● Under the commonly accepted cost
per QALY thresholds ($50,000$100,000/QALY), the newer directacting antivirals most often deemed
cost-effective
HTA: Health Technology Assessment
QALY: Quality-adjusted life year
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Many Models Did Not Capture Market-Based HCV
Drug Pricing and Publicly Reported Discounts
STUDIES MAY NOT REFLECT
ACTUAL PRICES PAID BY
PAYERS
• Inconsistency in the degree to
which models from payer
perspective reflected
anticipated or actual net HCV
drug pricing realities in the
marketplace
• Results from these analyses
may actually underestimate the
degree of cost-effectiveness –
depending upon the level of
net pricing that may be
realized in the marketplace
ONLY ONE STUDY1
APPROXIMATES PUBLICLY
REPORTED DISCOUNTS OF 0%
TO 44%
• Conforms most closely with
ISPOR Task Force guidelines by
introducing net pricing as a
distinct cost input
• Even with 0% discount, HCV
agents still possessed a cost per
QALY well below $100,000,
indicating high value
1 Chhatwal J, Kanwal F, Roberts MS, et al. Cost-Effectiveness and Budget Impact of Hepatitis C Virus Treatment With
Sofosbuvir and Ledipasvir in the United States. Annals of Internal Medicine. 2015;162:397-406.
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Important to Use Sound Costing Approach to Deliver
Assessments that Reflect Marketplace Realities
● Consensus guidance dictates that, where possible, all reported or
reasonably anticipated rebates, discounts, etc. should be considered as an
input for treatment cost comparison
● Many payers realize discounts not reflected in a benchmark price (e.g.,
WAC)
● Using benchmark prices could potentially lead to inflated cost-effectiveness
ratios that lead to improper assessments of treatments’ value
● As newer agents enter the market leading to increased competition and
rebates, we would encourage authors to update cost estimates in
previously published models to better reflect current marketplace realities
(i.e., available discounts)
Based on our review of the published models from the payer
perspective, those that found the new HCV agents to be cost-effective –
absent the use of market-based discounts – are underestimating value
WAC: Wholesale Acquisition Price
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Appendix
Methods
● Avalere conducted a literature search to identify the body of relevant HCV
direct-acting antivirals cost-effectiveness research
o PubMed search based on combinations of newly marketed HCV drug
names (e.g., sofosbuvir) and study design (e.g., cost utility) search terms
o Limited to studies conducted in adult humans with HCV, published in
English, focused on U.S. populations, conducted from the payer
perspective, reported results from a health economic model
● Supplemented PubMed search with a health technology assessment from
the Institute for Clinical and Economic Review and a search of professional
conference abstracts from ISPOR and the Academy of Managed Care
Pharmacy
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References
●
Chhatwal J, Kanwal F, Roberts MS, et al. Cost-Effectiveness and Budget Impact of Hepatitis C Virus
Treatment With Sofosbuvir and Ledipasvir in the United States. Annals of Internal Medicine.
2015;162:397-406.
●
Linas BP, Barter DM, Morgan JR, et al. The Cost-Effectiveness of Sofosbuvir-Based Regimens for
Treatment of Hepatitis C Virus Genotype 2 or 3 Infection. Annals of Internal Medicine. 2015;162:619629.
●
Saab S, Gordon SC, Sulkowski M, et al. Cost-effectiveness analysis of sofosbuvir plus
peginterferon/ribavirin in the treatment of chronic hepatitis C virus genotype 1 infection. Alimentary
Pharmacology and Therapeutics. 2014;40:657-675.
●
Younossi ZM, Park H, Saab S, et al. Cost-effectiveness of all-oral ledipasvir/sofosbuvir regimens in
patients with chronic hepatitis C virus genotype 1 infection. Alimentary Pharmacology and Therapeutics.
2015;41:544-563.
●
Gaitonde P, Yerlikaya NS, Chirikov VV, et al. Cost-effectiveness analysis of Sofosbuvir based
combination therapies among patients with HCV infection. Poster presented at ISPOR 20th Annual
International Meeting, May 2015, Philadelphia, PA, USA.
●
Tabano DC, Dilokthornsakul P, Campbell JD, et al. Cost Effectiveness of New Hepatitis C Therapies.
Poster presented at ISPOR 20th Annual International Meeting, May 2015, Philadelphia, PA, USA.
●
Tice JA, Ollendorf DA, Chahal HS, et al. The Comparative Clinical Effectiveness and Value of Novel
Combination Therapies for the Treatment of Patients with Genotype 1 Chronic Hepatitis C Infection. A
Technology Assessment from the California Technology Assessment Forum, Completed by the Institute
for Clinical and Economic Review. Final Report Released on January 30, 2015. Accessed at:
http://ctaf.org/sites/default/files/assessments/CTAF_HCV2_Final_Report_013015.pdf
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