New Payment Models for CAR T-cell Treatments Are Still Years Off

September 23, 2019

On Aug. 7, CMS announced that, effective Oct. 1, it would cover two types of CAR T-cell treatment, which use a patient’s genetically modified immune cells to fight cancer. But private payers continue to reimburse providers for CAR T-cell treatment for patients on a case-by-case basis, experts tell AIS Health, and they expect that trend to continue until this treatment becomes a standard of care. That’s likely to take more than three years.

In August 2017,

On Aug. 7, CMS announced that, effective Oct. 1, it would cover two types of CAR T-cell treatment, which use a patient’s genetically modified immune cells to fight cancer. But private payers continue to reimburse providers for CAR T-cell treatment for patients on a case-by-case basis, experts tell AIS Health, and they expect that trend to continue until this treatment becomes a standard of care. That’s likely to take more than three years.

In August 2017, FDA approved Novartis’ Kymriah (tisagenlecleucel) for certain pediatric and young adult patients with a form of acute lymphoblastic leukemia (ALL). In October of that year, the federal agency approved Kite Pharma, Inc.’s Yescarta (axicabtagene ciloleucel) for adult patients with certain types of large B-cell lymphoma who haven’t responded to or who have relapsed after at least two other kinds of treatment.

According to the National Cancer Institute, approximately 3,100 patients age 20 and younger are diagnosed with ALL each year; B-cell is the most common type of ALL. Kymriah is intended for patients whose cancer has been unresponsive to or has returned after additional treatment; this occurs in 15% to 20% of patients.

Diffuse large B-cell lymphoma is the most common type of non-Hodgkin’s lymphoma (NHL) in adults. Each year, approximately 72,000 new cases of NHL are diagnosed; diffuse large B-cell lymphoma constitutes about one in three newly diagnosed cases.

According to James Baumgardner, Ph.D., senior research economist at Precision Health Economics, CMS’s decision to cover CAR T-cell treatment signals to private payers that they must cover the treatment (see box, p. X). He adds that, based on his research, published in the journal Blood — and research conducted by the Institute for Clinical and Economic Review (ICER) — CAR T-cell treatments do quite well on cost-effectiveness metrics.

“The cost of [CAR T-cell treatment] is very high. The benefits are also very high,” says Baumgardner.

Affordability Will Be an Issue

ICER released a report in March 2018 that said both therapies “appear to be priced in alignment with their clinical value, but there are potential short-term affordability concerns — for axicabtagene ciloleucel under its current indication, and for both treatments should they receive future approvals for broader patient populations.”

In addition, ICER encouraged stakeholders to “collaborate now to develop payment and delivery systems that can ensure timely patient access, manage short-term affordability for expensive one-time treatments, and continue to reward the innovation that brings these new treatments to market.”

Significant changes to payment models for CAR T-cell treatment are at least three years away, says Max Cambras, managing partner and partner in L.E.K.’s life sciences practice. Payers need access to clinical outcomes data before they can propose a different payment model, such as “some sort of a capitated rate” or a bundle for the episode of care. The lack of insight into the patient populations that are more likely to have complex and costly adverse events is an impediment to bundled payments, he adds.

Thus, big questions — and challenges — remain for payer executives. One question that’s top of mind: How will they cover patients who need these life-saving treatments while managing risk and remaining profitable?

Kymriah costs $475,000 and Yescarta costs $373,000, each on a per-treatment basis. The price tags only include the costs of the drugs, not the follow-up care patients receive after treatment. Serious side effects, such as cytokine release syndrome (a large, rapid release of cytokines into the blood from immune cells affected by immunotherapy), neurological toxicities and fever, can make caring for some patients more complex.

More Patient Data Is Needed

It’s those serious side effects that land some patients in the intensive care unit. That’s another factor that can introduce significant variability into the type of care patients need and the total cost of care.

Given this reality, Cambras says patient stratification is the key to cost management. But that data will come only as providers treat more patients with CAR T-cell therapy. With this data in hand, he says providers and payers will be able to determine the patients who are most likely to experience serious side effects and then plan more effectively for the cost of care.

Cambras says CMS’s recent announcement signals that providers have “a lot more latitude in terms of the site of care,” and that flexibility could reduce the total cost of care. For example, providers could consider moving some aspects of the patient’s care to a skilled nursing facility, he adds.

CMS’s announcement also has an immediate impact on private payers’ Medicare Advantage plans, says Ash Shehata, partner with KPMG’s Global Healthcare Center of Excellence. CAR T-cell treatment becoming part of the standard Medicare benefit is “obviously a pretty big deal” for seniors, he adds. That means private payers will now be tasked with accommodating these treatments in their Medicare Advantage plans.

As CAR T-cell treatment continues to move from an approved therapy to a standard treatment within Medicare, Shehata says Medicaid will likely provide coverage as well. While CMS announced that it will increase its reimbursement from 50% to 65% of the cost of the treatment, state Medicaid programs are likely to pay even less, likely around 40%, he adds.

Payers Should Examine Contracts

Shehata’s advice, especially for larger payers: Take a hard look at contracts with providers. Also important is monitoring the reimbursement rate at which Medicare and Medicaid pays for these treatments and tracking reimbursement to those trends.

In addition, he advises payer executives to invest in a care coordination-focused approach to patients. Specifically, that means being mindful about the many “transactional decisions” about subsequent treatments and hospital admissions. “You can’t wait three or six or nine weeks between treatment processes to get approval,” says Shehata.

He also says payers should choose a select group of providers that understand how to manage patients through their care journey with CAR T-cell treatment.

Then there are the calls payers will receive from patients and physicians seeking information about coverage for CAR T-cell treatment. Payers must prepare for these phone calls, counsels Shehata. Staff at payers’ call centers will need detailed information at their fingertips to handle these questions; coverage plans will also need to be updated, he says.

Ben Isgur, who leads the Health Research Institute at PwC, advises payer executives to consider new approaches to covering CAR T-cell treatments. Take, for example, a mortgage model, where a series of perhaps three payments are made over a period of time, or a pure outcomes model, where the manufacturer is paid based on achieving certain health outcomes.

Another option is a hybrid of both approaches, he says. In the hybrid option, the manufacturer receives an initial “mortgage” payment and subsequent payments are based on meeting clinical outcomes.

Isgur says payers can also tap into previous learnings with drugs that treat hepatitis C. Gilead’s Sovaldi initially hit the market at $84,000 for a 12-week treatment, and the company’s Harvoni initially cost $94,500.

Payers’ actuaries were initially caught off guard with these treatments, he says. But, over time, the hepatitis C treatments have meant fewer liver transplants and more lives saved.

Three lessons learned with hepatitis C drugs, according to Isgur:

(1) Track these patient populations, in this case, patients with hepatitis C.

(2) Realize that competition is going to bring down drug prices.

(3) Take advantage of bulk pricing or a subscription model. For example, Louisiana has negotiated a subscription model with Asegua Therapeutics, a subsidiary of Gilead Sciences, for a fixed amount it pays the company for hepatitis C treatment for its Medicaid and prison populations (RDB 1/24/19, p. 1). NPR reports that the state has at least 39,000 people in these subgroups.

by Aine Cryts


MMIT’s Take: CAR T-cell Treatments

“The fourth quarter of 2018 was a crucial point for [Novartis’] Kymriah, which saw multiple controllers begin to adopt coverage,” Bill Fucich, a client success lead at MMIT, tells AIS Health. Now that new payment models for CAR T-cell treatments are in development, more payers will be reconsidering Kymriah’s formulary placement, but affordability will be key in determining coverage.

Fucich outlines how payers can begin strategizing to keep costs down. “Identifying self-funded lives for the medical benefit and those self-funded lives with a stop-loss option are key in this space due to the high cost of therapy,” he says. “The ability to negotiate an installment payment plan versus a one-time payment can keep costs in check and impact access.”

Payers should also look to how major insurers have covered Kymriah since launch. He points out that both UnitedHealth Group and Anthem, Inc. began covering Kymriah in the fourth quarter of 2017, within six months of the drug’s launch. “UnitedHealth Group and Anthem, Inc., the two largest payers in the commercial space, have shown willingness to cover products in this space with restrictions and adopt coverage earlier in launch,” he says.

“Kymriah saw the largest increase of coverage after 18 months post launch, gaining 68 million lives from 12 months post launch in the commercial space,” Fucich says. “This resulted in coverage increasing from 40% to 89% of commercial lives.”

Medicaid coverage also picked up steam in the same 18-month time period, Fucich says, pointing out that UnitedHealth and Anthem, the second and third largest managed Medicaid payers in the U.S. behind Centene Corp., displayed coverage nearly a year before any other Medicaid payers.

“The state of New York was also an early adopter of coverage on the Medicaid side, adopting coverage in the first quarter of 2018, slightly after United and Anthem,” he says. Fucich says about 10.5 million people, approximately one-sixth of all Medicaid lives, have access to Kymriah.


PBMs Are Hesitant to Add New Narcolepsy Drugs to Formularies

Two newly approved narcolepsy medications offer novel, possibly more effective options to people for whom older medications aren’t working well, but most health plans are requiring patients and providers to try generic alternatives first.

The FDA in March approved Jazz Pharmaceuticals’ Sunosi (solriamfetol) the first dual-acting dopamine and norepinephrine reuptake inhibitor, for adults with narcolepsy or obstructive sleep apnea. In August, the agency approved Harmony Biosciences, LLC’s Wakix (pitolisant), a selective histamine 3 receptor antagonist/inverse agonist that works to increase histamine in the brain. Sunosi was launched in July, and Wakix is expected to be launched later this year.

Some researchers say Sunosi and Wakix may have advantages over older treatments. Still, plans have been reluctant so far to add Sunosi to their preferred drug lists, and they seem likely to take the same cautious approach with Wakix.

First-line treatment for narcolepsy generally involves stimulant medications such as methylphenidate, amphetamines or modafinil/armodafinil, says Mesfin Tegenu, R.Ph., president of PerformRx. “Efficacy of the agents rarely exceeds around 70% to 80% of the normal ability to stay awake,” Tegenu tells AIS Health.

April Kunze, Pharm.D., senior director, clinical formulary development and trend management strategy at Prime Therapeutics LLC, adds that “more than half of all patients fail over time on Provigil [modafinil] or Nuvigil [armodafinil].”

Some stimulants, including modafinil and some forms of methylphenidates and amphetamines, are available in generic form, Tegenu says. “Many plans may require trial(s) of an available generic product prior to payment of a brand-only formulation, or trial of less costly alternatives to higher-priced generic items if there’s a significant price difference,” he says.

It’s not clear whether either Sunosi or Wakix provide substantially better outcomes than the therapies currently in use, says April Kunze, Pharm.D., senior director, clinical formulary development and trend management strategy at Prime Therapeutics LLC.

“Sunosi has not been compared to modafinil in head-to-head studies,” Kunze says. “Solriamfetol may be a reasonable choice with more clinical experience and head-to-head studies showing non-inferiority or superiority to modafanil. Until that time, it is likely that payers will want to use guideline-recommended therapies prior to a new therapy.”

Studies Highlight Drugs’ Effectiveness

Sunosi’s approval was based on Phase 3 clinical trials involving more than 900 narcolepsy and obstructive sleep apnea patients who received either 75 mg, 150 mg or 300 mg of Sunosi, or placebo, once a day. Compared to the placebo group, the patients who received 150 mg of Sunosi were able to stay awake better by the end of the trial. In the 12-week clinical studies, approximately 68% to 74% of people taking Sunosi at 75 mg and 78% to 90% of people taking Sunosi at 150 mg reported improvement in their overall clinical condition.

The study showed that the improvements in wakefulness began during the first week of taking the drug and ramped up throughout the 12-week trial period. Data from the group taking 300 mg indicated a greater risk of side effects. Because of this, the FDA considered implementing a black box warning on the drug, but Jazz avoided the black box by limiting dosage to 150 mg.

Wakix, which is the only narcolepsy treatment not scheduled as a controlled substance, is set to launch in the fourth quarter. Trials that included 261 patients in total demonstrated a statistically significant improvement in excessive daytime sleepiness when compared to placebo. Harmony Biosciences says the drug may appeal to patients who don’t want to take controlled substances.

Prime Therapeutics will be evaluating Sunosi at its next Pharmacy & Therapeutics (P&T) committee meeting for formulary placement and utilization management placement, Kunze tells AIS Health. Wakix also will undergo P&T review prior to launch.

Tegenu says that both Sunosi and Wakix are non-formulary products for now for PerformRx, since it’s not possible to know whether they’re equally or more effective than older treatments. They will be “handled the same as all newly available drugs: considered non-formulary until enough clinical data is made available to add them to the covered medications class of drugs.”

by Jane Anderson


Home Infusions Declined From 2018-2019, but Rise Is Expected

by Angela Maas

A recent study by UnitedHealth Group says the location in which a specialty drug is administered could make a huge difference in terms of costs. The study estimates that when specialty therapies are administered in a patient’s home or in a physician’s office as opposed to a hospital outpatient department (HOPD), annual savings for five conditions would total $4 billion. But Zitter Insights research shows that the percentage of people receiving nononcology infusions at home actually dropped between 2018 and 2019.

The United study found the following savings opportunities per patient when a drug was administered at home or in a physician office vs. an HOPD:

✦ For multiple sclerosis, there was a savings of $37,000 for four months of treatment.

✦ For immune deficiency, there was a savings of $32,000 for six months of treatment.

✦ For rheumatoid arthritis, there was a five-month savings of $28,000.

✦ For inflammatory bowel disease, there was a five-month savings of $21,000.

✦ For cancer chemotherapy, there was a savings of $16,000 for four months of treatment.

Between May 30 and July 20, Zitter surveyed pharmacy and therapeutics (P&T) committee members who work for 48 commercial plans covering 170.4 million lives and found that an average of 12% of the plans’ members receive nononcology infusion therapy at home (see chart below). That’s down from the 16% reported for 2018 by 49 commercial plans covering 147.6 million members. Also seeing a decline were HOPD infusions, which dropped from 13% in 2018 to 10% this year. However, the percentage of physician office administrations increased from 19% to 24%. Many of the payers said they anticipated a shift in care to the home by the middle of 2020.

Zitter also found that among the 48 commercial respondents, 45% prefer that specific therapies are administered either at home or at an infusion center. Sixty percent of 30 Medicare payers with 32.3 million covered lives also cited this. Among the commercial plans, 30% said they always prefer home infusion regardless of what drug is being administered.



Reality Check: Breast Cancer HER2+



Pharmacy Benefit

Under the pharmacy benefit, about 32% of the lives under commercial formularies are covered with utilization management restrictions. In health exchange and Medicare formularies, about 38% and 52% of the lives are not covered for at least one of the drugs, respectively.

Medical Benefit

About 39% of the lives under commercial policies have access to the medications with utilization management restrictions. Under Medicare policies, more than 82% of the lives are covered without restrictions in place.


Trends From AIS Health

Amgen and Allergan Launch Kanjinti

In July 2019, Amgen Inc. and Allergan plc launched oncology drugs Mvasi (bevacizumab-awwb), an Avastin (bevacizumab) biosimilar, and Kanjinti (trastuzumab), a Herceptin (trastuzumab) biosimilar. They are the first biosimilars of those reference drugs, both from Genentech USA, Inc., a Roche Group unit, to launch in the United States. The biosimilars are priced 15% less than their reference products.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online

FDA Approves Kanjinti

In June 2019, the FDA approved Amgen Inc. and Allergan plc’s Kanjinti (trastuzumab-anns) for the treatment of human epidermal growth factor receptor 2-overexpressing breast cancer and HER2-overexpressing metastatic gastric or gastroesophageal junction adenocarcinoma. It is the fifth biosimilar of Herceptin (trastuzumab), from Genentech Inc., that the agency has approved.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online

Payers Plan to Prefer Herceptin Biosimilars

With the Herceptin biosimilars expected to become available in 2019, almost half of commercial payers responding to a Zitter Insights survey say they expect to prefer biosimilar Herceptin over other similar drugs for the adjuvant treatment of breast cancer. The respondents also said the average discount, inclusive of rebates, required for them to prefer biosimilar Herceptin over other HER2-positive adjuvant therapies is 35%.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online


Key Findings

Market Events Drive Changes

In June 2019, the FDA approved Amgen Inc. and Allergan plc’s Kanjinti (trastuzumab-anns) for the treatment of human epidermal growth factor receptor 2-overexpressing breast cancer and HER2- overexpressing metastatic gastric or gastroesophageal junction adenocarcinoma. In July 2019, it became the first biosimilar of Herceptin (trastuzumab), from Genentech USA, Inc., a Roche Group unit, to launch in the U.S. The FDA has approved other biosimilars of the therapy, but they have not launched yet; more are in the pipeline. In February 2019, the FDA approved a subcutaneous form of Herceptin, Herceptin Hylecta, for use in HER2-positive breast cancer.

Competitive Landscape

In most cases, especially when used before or after surgery, chemotherapy is most effective when combinations of drugs are used. Today, doctors use many different combinations, and it’s not clear that any single one is the best. It is rare to see a payer place branded products for breast cancer on a preferred tier in the pharmacy benefit, mainly because the majority of products process through the medical benefit. Since many combinations of products are used, no preference is given to one combination over another.

Payer Coverage

We typically see treatment through standard-of-care chemotherapy, and combinations follow more targeted therapy. Many policies require HER2 testing. Reimbursement via buy and bill and specialty pharmacy requirements are common. Most policies follow national guidelines in cancer treatment.

Recent Situations Stress That Data Is More Important Than Ever to FDA, Drug Uptake

September 16, 2019

A pair of drugmakers and the FDA found themselves in the news lately, but it’s safe to say it wasn’t for the reasons they would prefer. Both situations stress the importance of data needed to secure product approvals, and, perhaps, payer and provider uptake.

On Aug. 6, the FDA put out a statement addressing “data accuracy issues” with Zolgensma (onasemnogene abeparvovec-xioi), a new gene therapy to treat spinal muscular atrophy in people less than 2 years old who have bi-allelic mutations in the survival motor neuron 1 gene,

A pair of drugmakers and the FDA found themselves in the news lately, but it’s safe to say it wasn’t for the reasons they would prefer. Both situations stress the importance of data needed to secure product approvals, and, perhaps, payer and provider uptake.

On Aug. 6, the FDA put out a statement addressing “data accuracy issues” with Zolgensma (onasemnogene abeparvovec-xioi), a new gene therapy to treat spinal muscular atrophy in people less than 2 years old who have bi-allelic mutations in the survival motor neuron 1 gene, including those who are presymptomatic when diagnosed.

The one-time therapy has the distinction of being the most expensive drug in the world, with a price tag of $2.1 million.

The FDA approved the drug from AveXis, Inc. on May 24 (SMA 7/1/19, p. 6). On June 28, AveXis — which was acquired by Novartis AG last year — notified the agency that there was “a data manipulation issue that impacts the accuracy of certain data from product testing performed in animals submitted in the biologics license application (BLA) and reviewed by the FDA.”

According to a July 26 memorandum by Wilson W. Bryan, M.D., director of the FDA’s Office of Tissues and Advanced Therapies, “AveXis appears to have become aware of the data manipulation as early as March 14, 2019,” but rather than informing the agency, which was evaluating Zolgensma’s BLA at the time, the company first conducted its own internal investigation, reporting its findings to the FDA after the investigation was completed. Had the FDA known of the issue before it approved Zolgensma, “I believe that the approval would have been delayed” beyond its Prescription Drug User Fee Act (PDUFA) date of May 31, he wrote, adding that he believed the FDA still would have approved the BLA.

“Based on the information available at this time, the Phase 3 clinical trial results continue to provide compelling evidence of the effectiveness of Zolgensma, along with sufficient evidence of safety to support an overall favorable benefit-risk profile,” wrote Bryan.

“It is the manufacturer’s responsibility to submit complete and accurate information in marketing applications for evaluation by the FDA. If we become aware of a concern with data submitted to the agency as part of our review of a product application, it is in the best interest of patients, their caregivers, and the public that we disclose such information, to the extent permitted by law,” said the FDA in its statement. It said that it “remains confident that Zolgensma should remain on the market.”

However, the agency said, it is “carefully assessing this situation” and could “take action, if appropriate, which may include civil or criminal penalties.” According to Bryan’s memo, “a complete assessment of the impact of the data manipulation will require additional investigation, discussions both internally within CBER [i.e., the FDA’s Center for Biologics Evaluation and Research] and with AveXis, will probably require that AveXis submit and FDA review one or more BLA supplements, and may take at least several months.”

In response to the FDA statement, Novartis issued a press release Aug. 6 that read, in part, “we maintain that the totality of the evidence demonstrating the product’s effectiveness and its safety profile continue to provide compelling evidence supporting an overall favorable benefit-risk profile. We remain steadfast that this important treatment remain available.” It defended its decision to conduct an investigation before alerting the FDA and noted that “at no time during the investigation did the findings indicate issues with product safety, efficacy or quality.…We have and will continue to work in close cooperation with the FDA to appropriately update our submission and address any quality gaps identified. We are committed to ensuring the highest levels of transparency and integrity with health agencies, as well as with the patients and providers we serve.…AveXis is committed to taking appropriate action to prevent future incidents.”

Committee Called for Investigation

But that statement did little to quell the indignation that many began to express.

On Aug. 9, Senate Committee on Finance Chair Chuck Grassley sent a letter to Novartis CEO Vas Narasimhan that said AveXis’ “conduct is reprehensible and could have an adverse effect on patients. Accordingly, the conduct ought to be investigated and, as appropriate, punished to the fullest extent of the law.” In order to understand Novartis’ actions, Grassley asked for several pieces of information by Aug. 23, including all records that relate to the company’s withholding data from the FDA, as well as all records that relate to its internal investigation.

Also on Aug. 9, five senators, including Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), sent a letter to FDA Acting Commissioner Ned Sharpless, M.D., urging the agency to “use your full authorities to hold AveXis accountable for its malfeasance, including through all appropriate criminal, civil, and regulatory actions against the company. Anything short of a forceful response would signal a green light to future pharmaceutical behavior.” The situation, they wrote, “smacks of the pharmaceutical industry’s privilege and greed.…It is an outrage that after knowingly misleading the FDA in a rush to make a profit,” Novartis in its Aug. 6 press release refused “to acknowledge any culpability or remorse. Instead, the company doubled down on its greed-driven behavior.”

The senators also requested a written response by Sept. 1 as to why the agency withdrew a proposed regulation (RIN 0910-AC59) in October 2018 requiring certain clinical trial sponsors to promptly notify the FDA of suspected data falsification. They also wanted to know if the FDA will re-issue the regulation, which was introduced initially in February 2010. That regulation said that 45 calendar days was an appropriate time frame for reporting issues.

At the time of the withdrawal, an FDA spokesperson told Bloomberg Law that “we have determined that this rule is no longer needed given other existing requirements around the integrity of clinical trial data.”

On Sept. 5, speaking at the Research!America 2019 National Health Forum, Sharpless addressed data integrity, and, while he did not specifically mention Novartis, some of his comments appeared aimed at the company. “Data can be bad for a few reasons, but two important causes are sloppy, slipshod data collection or even data falsification. It can be difficult for the FDA to tell these apart, because they differ in terms of intent; that is, if data are bad because of carelessness or because of fraud. But from one point of view, it does not matter that much whether we are dealing with incompetence or malfeasance, because either case can lead to a regulatory decision that harms patients.”

He recalled that he had experience with the submission of false data while at the National Cancer Institute, where he “saw some people mislead us in grant applications.

“So it should not be surprising to me now at FDA that if people will lie to get their paper published or get their grant funded, then people will also lie to get a billion dollar medical product approved,” he continued. While he said deception is rare, instances of it “are significant because even a few examples can damage public confidence in the approval process.”

A Sept. 10 article on the Endpoints News website on results of a global group of 74 senior pharma executives surveyed between Aug. 27 and Sept. 9 revealed that six out of 10 “rated Novartis’ response as poor. Only 14% thought it could qualify as fair.” Among respondents’ comments were the following:

✦ “At best, the response was ham handed and tone deaf. And if true that the manipulated data did not impact patient safety or drug efficacy, own the misconduct and apologize properly.”

✦ “Novartis is a global pharma company and has taken a huge risk by not bringing this to the FDA’s attention as soon as they did the initial investigation. This type of behavior plays right into the hands of those who say that pharma is only looking out for the bottom line and not patients’ well being.”

✦ “Novartis should have disclosed their findings to the FDA immediately and then cooperated with the Agency on the ongoing investigation. As it was, the timing of disclosure and their ensuing explanations reflected very poorly on Novartis.”

✦ “A bit of mea culpa would have gone a long way. We all get that the data issue was inconsequential. That is not the point. The point is the principle of working as a team and being transparent.”

✦ “We are in a trust industry and anything that casts doubt about our [veracity] damages us all.”

Another exec said Novartis was in a “no win situation” and that while the CEO ultimately was the one responsible, “there would have been multiple inputs and personalities chiming in along the way.”

Thirty-five percent of the respondents said the FDA should implement the regulation on drugmakers’ reporting data in a timely fashion, while 23% were not in favor of it.

Novartis Tried to Rectify Situation

After Novartis’ initial comments were widely derided, it took a series of steps to try to rectify the situation.

It let go AveXis employees whom it blamed for the problematic data. One of those employees, Brian Kaspar, the former chief scientific officer, has said that he “stands proudly behind the safety and efficacy of the drug that he and his team worked so hard to develop,” according to a statement from his attorney covered by several news outlets. “He has cooperated with AveXis’s internal investigation, and he categorically denies any wrongdoing. He is prepared to assert his rights and defend his conduct accordingly.”

An Aug. 17 Business Standard online article, citing German newspaper Schweiz am Wochenende, said that in a call with company managers, “Narasimhan said he is not perfect as a CEO and ‘we will all keep working on it.’”

On Sept. 9, according to an online article on Regulatory Focus, Narasimhan told attendees of an investor conference that Novartis is “voluntarily and proactively taking a pledge with the FDA to ensure that we will inform them within five business days of any credible allegation related to data integrity.” He also said that the company has responded to the agency and is providing it with requested documents. And he reiterated that the issue “does not impact the safety, efficacy or quality of Zolgensma.”

“This is a unique situation,” observes Jayson Slotnik, a partner at Health Policy Strategies, Inc. “But the data not disclosed would not have made a difference anyway. There’s a tremendous disconnect between reality and perception. To some extent, it was the perfect storm brewing that bit Novartis.”

“Does this hurt Novartis? Of course, in the eyes of public opinion,” says an industry expert who declines to be identified. “Does this hurt Novartis in terms of drug discovery and investment? Absolutely not.”

Asked if there was anything Novartis might have done differently, Slotnik points out that “Novartis is not a small fly-by-night company.” It has experienced people who did what they did based on that experience, he tells AIS Health, and they obviously felt that “this was not information that necessarily needed to be disclosed. I’m going to give them the benefit of the doubt.…This is not their first rodeo.”

According to Slotnik, “there’s a very interesting and careful balance” among what companies should disclose legally, regulatorily and “in the court of public opinion. And that line constantly changes based on political and policy whims.” In addition to companies’ understanding of what they do and don’t need to disclose, they also must balance when and how they do disclose that information.

“This is classic Crisis Management 101,” he says. “And God bless the FDA,” which is in “an impossible situation of having to constantly balance” the intricacies of the industry.

But the timing couldn’t be worse for the company and the pharma industry, which has been under fire over its drug pricing practices.

Novartis recently said that Zolgensma has coverage plans from payers representing 40% of commercial lives, and high-profile news reports name Aetna Inc. and Anthem, Inc. among insurers expanding their policies to cover more patients. So will the current situation have any impact on pickup among payers and providers?

“I’m not on anyone’s P+T [i.e., pharmacy and therapeutics] committee, so I have limited insight into how Novartis actions impact coverage deliberations of those folks,” says Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates. But based on the FDA’s statement, “I expect there will be no more than a minor and temporary blip in pickup of Zolgensma among providers and payers.”

The second incident occurred Aug. 19, when the FDA declined to approve Sarepta Therapeutics, Inc.’s Vyondys 53 (golodirsen) for Duchenne muscular dystrophy, instead issuing a complete response letter (CRL). The company had sought accelerated approval for the drug.

Prior to the issuance of the CRL, analysts widely believed the agency would approve the drug, in part based on the FDA’s approval of another Sarepta therapy for a different subset of people with Duchenne muscular dystrophy, Exondys 51 (eteplirsen), in September 2016. That drug’s approval process was a contentious one. During an April 2016 meeting, the FDA’s Peripheral and Central Nervous System Drugs Advisory Committee voted against approval, questioning whether the small clinical trial sample size — 12 boys — was large enough, among other things. The FDA requested additional information in June, and based on that, Janet Woodcock, M.D., director of the FDA’s Center for Drug Evaluation and Research, granted Exondys 51 accelerated approval. But her decision generated a great deal of pushback from colleagues within the agency, including the filing of a formal dispute. FDA Commissioner Robert Califf, M.D., was forced to make the final decision, in which he deferred to Woodcock.

Four days before the FDA issued the CRL for Vyondys 53, an Aug. 15 STAT article examined the status of Sarepta’s confirmatory trials for Exondys 51. The company was required to conduct clinical trials confirming the $300,000-per-year drug’s effectiveness, with a trial ending in 2020, followed by submission of data to the FDA in 2021. But a plan for a trial that the company submitted to the FDA in June said enrollment should be started by the end of 2019 and gave an expected date for results of 2024.

Per the article, “an FDA spokesperson told STAT that Sarepta is still being held to the 2020-2021 post-marketing requirement timeline established in the original Exondys accelerated approval agreement. ‘FDA does not make a determination of whether a company has good cause for failure to comply with post-marketing requirement milestones until they are actually missed,’ the FDA spokesperson said. ‘We cannot stress enough the importance of the confirmatory studies, both to the patients with Duchenne and their families and to the community of patients who will benefit in the future from accelerated approval.’”

Sarepta issued a press release following the FDA’s rejection of Vyondys 53, saying that the CRL “generally cites two concerns: the risk of infections related to intravenous infusion ports and renal toxicity seen in pre-clinical models of golodirsen and observed following administration of other antisense oligonucleotides.” The company said it was “very surprised” to get the CRL, as “over the entire course of its review, the Agency did not raise any issues suggesting the non-approvability of golodirsen, including the issues that formed the basis of the complete response letter.” It said it would work with the agency to resolve those issues in order to gain the drug’s approval.

An Aug. 19 STAT article said the FDA’s rejection “might represent a new and more restrictive regulatory policy at FDA, which could affect all companies developing drugs for rare diseases. But it might also only pertain to Sarepta, which has had a contentious relationship with the agency for many years.…Sarepta’s delinquency on Exondys 51 may have angered the FDA enough to play a role in the agency’s decision Monday to reject Vyondys 53.” Analysts pointed to that earlier approval as leading to FDA “payback,” saying the FDA was “slap[ping Sarepta] on the wrist for the prior questionable accelerated approval of Exondys 51.”

“One the one hand, you could view this as the FDA giving Sarepta payback,” says the unidentified industry expert. “On the other, you want to believe that the FDA is not like this. They’re just humans doing their job.” At the end of the day, “data is data and speaks for itself.”

Last month, an article in the journal Manufacturing & Service Operations Management, which is published by INFORMS, an international association for operations research and analytic professionals, looked at accelerated approval. Researchers noted that the Government Accountability Office found that among 90 drugs on the market that received accelerated approval between 1992 and 2008, 36% of required confirmatory studies were not completed by 2009 and half of those took an average of 5.5 years to begin.

“Perhaps manufacturers do not feel a sense of urgency to complete confirmatory studies, if the FDA does not threaten to rescind pre-approval and if being on the U.S. market based on that pre-approval makes full regular approval a moot point,” says Rubinstein. “However, potential payer reluctance to cover a product that does not have full regular FDA approval should itself present sufficient rationale and urgency to complete a confirmatory trial.” As an example, he points to UnitedHealthcare’s policy on Exondys 51, which says the treatment is “not medically necessary for treatment of Duchenne muscular dystrophy (DMD) due to lack of scientific evidence showing clinical benefit and efficacy.”

Asked if the FDA might pull Exondys 51 from the market if its confirmatory trials are behind schedule, Slotnik says, “no — I don’t see the FDA pulling it. But I think some payers may respond and will not cover it until the trials are done.” This action, he tells AIS Health, “achieves the same goal without the FDA being involved. Regardless, though, this outcome would be bad for patients.”

Slotnik points out that a number of publicly traded companies have had FDA-related issues over the past 12 months that have posed a struggle for them. “Mind your Ps and Qs,” he says. “Nothing’s changed.” Drugmakers should “err on the side of caution and transparency” and remember that “you get more bees with honey.”

Contact Rubinstein at and Slotnik at

by Angela Maas


Report Reveals That Almost 100 RM/AT Products Are in Phase III Clinical Trials

This past quarter saw two new gene therapies: Novartis AG subsidiary AveXis, Inc.’s Zolgensma (onasemnogene abeparvovec-xioi) received FDA approval May 24 for the treatment of spinal muscular atrophy (SMA 7/1/19, p. 6), and bluebird bio’s Zynteglo (autologous CD34+ cells encoding βA-T87Q- globin gene) received conditional marketing authorization from the European Commission for transfusion-dependent beta thalassemia.

While only a handful of therapies in the broader regenerative medicine/advanced therapy (RM/AT) space are available globally, a new report shows that is likely to change, as there are more than 1,000 products in the pipeline. Many of these therapies truly are innovative products, but they don’t come cheap and often have complex reimbursement schemes that some payers and providers are struggling with, an issue that will need to be handled soon as more of these therapies are poised to hit the market.

The Alliance for Regenerative Medicine published the report, titled Quarterly Global Regenerative Medicine Sector Report: Q2 2019, on Aug. 1. It shows there are 1,069 clinical trials using specific RM/AT technologies, which include gene therapy, gene-modified cell therapy, cell therapy and tissue engineering. Ninety- four of those products are in Phase III trials.

More specifically, the report reveals:

366 gene therapy clinical trials are underway: 117 are Phase I, 219 are Phase II, and 30 are Phase III.

410 gene-modified cell therapy trials are ongoing: 187 are in Phase I, 207 are in Phase II, and 16 are in Phase III.

249 cell therapy trials are proceeding: 49 are in Phase I, 168 are in Phase II, and 32 are in Phase III.

44 tissue engineering trials are happening: five are in Phase I, 23 are in Phase II, and 16 are in Phase III.

They also span a variety of indications (see chart below).

While Zolgensma’s $2.125 million price for a one-time infusion makes it the costliest drug on the planet, other newer RM/AT products are certainly not cheap. Spark Therapeutics Inc.’s Luxturna (voretigene neparvovec-rzyl), approved in December 2017 for a rare form of blindness, costs $425,000 per eye; Novartis Pharmaceuticals Corp.’s chimeric antigen receptor T-cell (CAR-T) therapy Kymriah (tisagenlecleucel), first approved in August 2017, costs $475,000 or $373,000 depending on the type of cancer it’s used in; and Gilead Sciences, Inc. unit Kite Pharma, Inc.’s Yescarta (axicabtagene ciloleucel), approved in October 2017 to treat large B-cell lymphoma, costs $373,000.

Many of these products’ manufacturers are offering various reimbursement schemes, including rebates if a therapy doesn’t work, other outcomes-based deals and multiyear pay-over-time payment options. But experts note that many barriers to successfully executing these deals exist.

“In principle, spreading the cost over a five-year period and putting the cost installments at risk based upon efficacy is a good approach,” says Winston Wong, Pharm.D., president of W-Squared Group, about Zolgensma. “However, the devil is in the details. Do we have the systems in place that have the capability to administer a five-year contract?”

In addition, he asks, “Who is responsible for the billing of the installment, and who is actually making the annual payment? Is it the insurance carrier in all cases, or is that passed on to the self-funded employer? Under the payment installment option, how does the provider, who has to obtain the product, get reimbursed?”

According to Wong, “We do not have the systems in place to handle the tracking and processing of installment billing over a period of five years, as well as having the ability to track patients once they have left the health plan,” which “will be a major obstacle to overcome for any value-based agreement where payment will be dependent upon continued efficacy of the therapy. From the manufacturer perspective, a value-based contract implies that no payment would be made if the patient relapses or passes on. Systems are not in place to have the ability to track the patient once therapy is administered.”

Download the report at

by Angela Maas

This story was reprinted from AIS Health’s monthly publication RADAR on Specialty Pharmacy. For more information, visit


Reality Check: PCSK9 Inhibitors


Our Point of View

The two available PCSK9s, Praluent (alirocumab) from manufacturers Sanofi and Regeneron Pharmaceuticals, Inc. and Repatha (evolocumab) from Amgen Inc., came onto the U.S. market in 2015 with list prices around $14,000 to $15,000 and quickly faced pushback from plans. Since then, the drugmakers have cut prices by more than 60%, but payers still have prior authorization on the drugs, including
confirmation of an appropriate diagnosis and that members either have LDL cholesterol levels uncontrolled by statin medications or are intolerant to statins, says Mesfin Tegenu, R.Ph., president of PerformRx. Patients also may be required to have a history of either established atherosclerotic cardiovascular disease or familial causes of hypercholesterolemia, says Erin Lopata, Pharm.D., senior director, access experience team at Precision for Value, and some plans may have additional requirements, such as a specialist prescriber, prior trial of Zetia (ezetimibe) and/or documented trial of lifestyle modifications.



Pharmacy Benefit

More than 90% of the lives under the pharmacy benefit in commercial and health exchange formularies have utilization management restrictions on PCSK9 inhibitors. About 15% of Medicare beneficiaries are not covered for at least one of the products.

Medical Benefit

Under commercial and health exchange policies, almost 40% of the lives have utilization management restrictions. Under Medicare policies, more than 86% of the lives are not covered for at
east one of the four products — Praluent Pen, Repatha Pushtronex, Repatha SureClick and Repatha Syringe — under the medical benefit.


AIS Health’s View

Some observers already call current PCSK9 pricing “value-based” since Amgen and Sanofi/Regeneron based the $5,850 yearly list price on value-based benchmarks established by the nonprofit Institute for Clinical and Economic Review. However, PCSK9s would be good candidates for true value-based payment arrangements since they “have a clear and measurable outcome in LDL reduction,” Tegenu says. Value-based contracts for PCSK9s could be developed to measure either long-term clinical outcomes — e.g., cardiovascular events — or short-term surrogate markers, such as LDL-C levels in patients treated with one of the products, says Lopata. She tells AIS Health that manufacturers and payers need to collaborate on the contracts to determine which outcomes measures they prefer and how the preferred outcome measures will be defined, tracked and paid for.


Trends From AIS Health

Drugmakers Slash Prices, Hope Plans See Value for PCSK9s

PCSK9 inhibitors, which fell flat in their debut four years ago as plans restricted access and steered their members to older, cheaper anti-cholesterol drugs, may receive a second chance at improving their market share as manufacturers slash prices and promote a value proposition for the biologics.

Subscribers to AIS’s RADAR on Health Plan Weekly may read the in-depth article online


Express Scripts Inks Deal for Praluent

In June 2018, Express Scripts Holding Co. struck a deal with Regeneron and Sanofi on their Praluent (alirocumab), one of two pricey PCSK9 inhibitors on the market, that will give the PBM a lower net price on the drug in exchange for streamlined patient access and an exclusive spot on the Express Scripts national formulary. With the new deal, Praluent will be the preferred PCSK9 on the formulary, and Amgen Inc.’s Repatha (evolocumab) will be excluded.

Subscribers to AIS’s RADAR on Drug Benefits may read the in-depth article online

Researcher: Discounts May Work as Well As Some Outcomes-based Contracts

As outcomes-based contracting gains ground, a University of Pittsburgh School of Pharmacy researcher asserts it may be no more cost effective than existing industry discounts. She urges payers to be cautious about how they form such agreements with pharmaceutical manufacturers, describing what she sees as “clearly a marketing move” by Amgen Inc. over its cholesterol-lowering drug Repatha (evolocumab). Yet Harvard Pilgrim Health Care, Inc., Cigna Corp. and other payers swear by their outcomes-based agreements with Amgen for this drug as a win for all.

Subscribers to AIS’s RADAR on Drug Benefits may read the in-depth article online


Key Findings

Contracting Competition

In May 2018, Sanofi and Regeneron lowered the annual cost of Praluent from $14,600 to between $4,500 and $8,000. In January 2019, Amgen announced that all Repatha device options’ prices had been reduced by 60%, from $14,000 to $5,850 per year.

Pharmacy and Medical Benefit Implications

Coverage is highly restricted with multiple steps and a laundry list of prior-authorization restrictions. All products are covered under the pharmacy benefit, but some also have medical coverage, which is rarely used by health care providers or the pharma companies.


AIS Health’s View

Pfizer Inc. discontinued the development of its PCSK9 bococizumab in 2016, claiming that the product was “not likely to provide value to patients, physicians, or shareholders.” But the Medicines Company’s inclisiran is in Phase III trials, and in August the manufacturer said that one trial showed positive results for twice-yearly dosing of the product to decrease LDL cholesterol. The company says it expects to file for FDA approval by the end of 2019. Lopata calls inclisiran “a promising pipeline product with a different approach to PCSK9 inhibition and the potential for a more convenient dosing regimen.” However, she notes that clinical data is still being developed. “Payers will be expecting strong clinical value — including cardiovascular outcomes data — as well as competitive pricing compared with the other PCSK9s for formulary consideration once approved,” she says.


Pediatric Managed Medicaid ACO Touts Crucial Role of Its Pharmacists

September 9, 2019

For a pediatric accountable care organization (ACO) that contracts with Ohio’s Medicaid managed care plans, improving care for children would be a much more difficult job without the expertise of pharmacists who understand the unique needs of those patients.

“Our MCO partners are often really well versed in the adult patient population and chronic diseases that afflict their adult patients — but sometimes the pediatric population’s chronic conditions are different,” Brigid Groves, a clinical pharmacist specializing in population health at Columbus-based Nationwide Children’s Hospital,

For a pediatric accountable care organization (ACO) that contracts with Ohio’s Medicaid managed care plans, improving care for children would be a much more difficult job without the expertise of pharmacists who understand the unique needs of those patients.

“Our MCO partners are often really well versed in the adult patient population and chronic diseases that afflict their adult patients — but sometimes the pediatric population’s chronic conditions are different,” Brigid Groves, a clinical pharmacist specializing in population health at Columbus-based Nationwide Children’s Hospital, tells AIS Health.

Groves is one of two pharmacists employed by Partners for Kids (PFK), the ACO affiliated with Nationwide Children’s Hospital that receives capitated payments from the state’s five MCOs to manage care for 330,000 children in central and southeastern Ohio.

As an example of how PFK pharmacists intervened to advocate for pediatric patients, Groves points to when the manufacturer of one type of inhaler shifted to a new, non-child-friendly delivery mechanism for the steroid that’s dispensed by the device.

As an example of how PFK pharmacists intervened to advocate for pediatric patients, Groves points to when the manufacturer of the inhaler Qvar (beclometasone dipropionate) changed the delivery mechanism for the steroid that’s dispensed by the device — requiring patients to “use their own breath and pull in like they’re drinking a thick milkshake through a straw to inhale that medication.” Adults and teenagers can follow those directions, but for four- or five-year-olds, “it’s pretty difficult to get them to put their socks on in the morning,” let alone teach them how to use such a device, Groves points out.

“When the manufacturer changed that product, our MCO plans were just kind of like, ‘great new product, put it on there’ [their formularies]. And it really impacted a lot of our kids because they weren’t able to get their steroid inhalers or use them appropriately,” she says. But PFK’s pharmacists explained the situation to the MCOs, and “our plans were then able to make appropriate changes on their formularies to allow our kids to have something that they could appropriately use that was clinically effective for the condition, as well as cost neutral.”

Hospitalizations, ER Visits Decreasing

One of the MCOs that contracts with PFK, CareSource, is currently making changes to how it covers the immunosuppressive drug Remicade (infliximab), and “we’ve worked with Partners for Kids pharmacists on our clinical criteria for prior authorization with pediatric use of that medication,” adds Nicholas Trego, Pharm.D., associate vice president of pharmacy for the insurer’s Ohio market.

On the clinical side, PFK’s pharmacists are spearheading a quality-improvement project focused on reducing asthma-related emergency room and inpatient visits by “ensuring that patients with asthma are appropriately diagnosed, evaluated and managed by pediatricians,” according to Groves’ study. In that effort, one measure Groves focuses on is patients’ asthma medication ratio (AMR), which shows how often patients fill prescriptions for rescue inhalers compared to controller inhalers. Having an AMR above 0.5 — meaning 50% of the time or more, patients have a controller inhaler on hand — is associated with fewer ER visits, she notes.

So, “we work with our practices out in the community to help them identify which patients they should target for asthma-related interventions using their AMR value,” Groves says.

As a result of that work, “we have seen changes in our AMR value as a network,” which means that “more patients are under control with their asthma, therefore less likely to go to the emergency department or be hospitalized,” she explains.

PFK pharmacists also collaborate with Ohio’s contracted Medicaid MCOs on the use of specialty pharmacy products for the pediatric population. “Obviously, those are very high-cost agents, so we want to use them judiciously,” Groves says. “When you have good relationships [with MCOs], you can work through those conversations and have a better impact up front on some of the prior authorization criteria.”

That may involve explaining that “’these are the things our kids are experiencing,’ or, ‘this is the study that shows why they need this medication,’” she adds.

CareSource also sees value in that form of collaboration. “They know what we’re looking for on the prior authorizations,” Trego says of PFK’s pharmacists, and they help physicians by filling out the forms with the correct information that CareSource needs to get medication approved faster for members.

MCOs Expect to See Savings

In addition to allowing practices to provide medications to patients more efficiently, “CareSource has probably seen administrative savings based on the fact that we’re not going back and forth, back and forth, back and forth with prior authorization requests like we do with many other specialty clinics that don’t have pharmacists embedded,” adds Jennifer Szumowicz, director of specialty pharmacy at CareSource.

PFK’s pharmacists also help advise patients and their families on how to use specialty medications, what side effects to expect and how to mitigate those effects, Trego notes.

“They honestly just teach the member and the member’s family about the medication, which is of great value to us, so the member knows exactly how to use the medication, when to use the medication, what to expect from the medication — so we can expect the adherence to the medication to be very high as a result of that work that they do,” he says.

While CareSource is not yet measuring how pharmacist-led interventions are improving medication adherence in the MCO’s pediatric population, the organization is currently “working out the logistics” with PFK on such an effort, according to Szumowicz.

by Leslie Small


New Radar Enhancement Allows for Email Alerts

Improved functionality for MMIT’s Radar Surveillance tool will make it easier for users to monitor assessments of policies. The new enhancement, to be made available in mid-September, will allow users to monitor assessments directly via email, in addition to being able to check the portal for updates.

Currently, Radar Surveillance provides daily alerts to users to let them know when MMIT has collected new pharmacy and medical benefit policy documents and forms. Our alerts are sent the day after collection, so users can access documents as soon as possible.

Users are then able to monitor those documents within our Radar platform, so that as our policy assessment teams review policies, users can easily view the new assessments and compare new assessments to previous versions. However, this requires the user to login to the platform and monitor documents to which they have already been alerted.

With the new enhancement, MMIT will send users daily alerts when we have completed assessments on documents previously collected. The alert will have two sections: (1) new documents and (2) new assessments of previously alerted documents. It links directly into the portal for easy access to full assessment details and to leverage other features of our portal.

The new assessment alert will notify clients of changes in prior authorization status, step therapy status, and other key policy and restriction data. Users will be able to see which benefit type, accounts, and channel the assessments apply to directly within the email as well.




FDA Guidance Encourages New Focus on Alzheimer’s Biomarkers, Early Detection

September 2, 2019

Alzheimer’s disease researchers, seeking to intervene much earlier in the disease’s progression, are being spurred on by signals from the FDA that it might agree to fast track promising Alzheimer’s drugs based on biomarkers alone, before patients show obvious cognitive and functional signs of the disease.

The FDA’s new stance, contained in draft guidance it released last year, is encouraging researchers and drug manufacturers to concentrate on identifying new biomarkers and developing new diagnostics to capitalize on them.

Alzheimer’s disease researchers, seeking to intervene much earlier in the disease’s progression, are being spurred on by signals from the FDA that it might agree to fast track promising Alzheimer’s drugs based on biomarkers alone, before patients show obvious cognitive and functional signs of the disease.

The FDA’s new stance, contained in draft guidance it released last year, is encouraging researchers and drug manufacturers to concentrate on identifying new biomarkers and developing new diagnostics to capitalize on them. Put together, the focus on early detection and intervention, biomarkers and diagnostic tools indicates a sea change in a clinical area that has seen more than its share of high-profile drug candidate failures in recent years.

Howard Fillit, M.D., founding executive director and chief science officer, Alzheimer’s Drug Discovery Foundation (ADDF), says he’s confident that new — and potentially game-changing — drugs will be approved within the next three to five years. The FDA’s intent with its new draft guidance was to signal to the Alzheimer’s research community that “things have changed since their last guidance,” Fillit tells AIS Health.

Previously, researchers had focused on people who had moderate to severe symptoms, not biomarkers, he says. “Now, they recognize that preclinical Alzheimer’s is defined by biomarkers, and the [early] clinical stage is defined by biomarkers and mild symptoms.”

The draft guidance isn’t intended to have the force of regulation, Fillit says. Instead, he says, it’s intended to show researchers and drug manufacturers what the FDA is thinking on how this clinical space is evolving — and ultimately what the agency’s reviewers will want to see in a drug approval application.

“As soon as a biotech company thinks they’re going to the clinic, they’re going to go talk to the FDA,” Fillit says. “Every step along the way, companies need to be discussing the way they’re developing the drug with the FDA.” This discussion would include the specific biomarkers the company is thinking about using, along with the cognitive scale it will use to evaluate results.

Trial Endpoints Have Changed

The FDA’s guidance notes that historically, the use of clinical criteria that defined later stages of Alzheimer’s, after the onset of overt dementia, were used for enrollment into clinical trials. Studies supporting approval of the four drugs currently approved for the condition used a co-primary approach to assessment of cognitive and functional measures. “This approach ensured both that a clinically meaningful effect was established by a demonstration of benefit on the functional measure and that the observed functional benefit was accompanied by an effect on the core symptoms of the disease as measured by the cognitive assessment,” the FDA said.

The co-primary endpoint approach was used, in part, because the cognitive assessments used in the studies were not considered inherently clinically meaningful, the FDA said. The new guidance states that the FDA would like to abandon its co-primary endpoint approach in favor of one that focuses only on cognition, not on function.

In addition, the FDA said, as the scientific understanding of Alzheimer’s disease has evolved, sponsors of clinical trials have made efforts to incorporate the use of biomarkers reflecting underlying Alzheimer’s disease pathophysiological changes and also have enrolled patients at earlier stages of the disease, when there may be no functional impairment or detectable clinical abnormality.

“These efforts are particularly important because of the opportunity to intervene very early in the disease process that AD [i.e., Alzheimer’s disease] provides, given the development of characteristic pathophysiological changes that greatly precede the development of clinically evident findings and the slowly progressive course of AD,” the FDA said. Delaying or preventing the process that leads to impairment is the ultimate goal, the agency said, so “treatment directed at this goal must begin before there are overt clinical symptoms.”

The FDA’s draft guidance doesn’t specify biomarkers that it prefers — instead, it says only that “the characteristic pathophysiologic changes [of the disease] are typically demonstrated by assessment of various biomarker measures” for patients in the earliest stage of the condition. This could be enough for accelerated approval, the agency said, although a drug approved on the basis of biomarkers for patients in Alzheimer’s Stage 1 (the earliest stage) then would need to prove efficacy on clinical benefit in post-approval studies.

The FDA stressed that it “strongly supports and encourages continued research” in the area of biomarkers for Alzheimer’s disease, especially as they relate to “successful development of effective treatments appropriate for use in the earliest stages of AD. Precompetitive structured sharing across the AD scientific community of rigorously collected standardized data is a crucial component of this research.”

The FDA is feeling significant pressure to help companies advance treatments for Alzheimer’s disease, says Alzheon, Inc. CEO Martin Tolar, M.D., whose company received fast track designation in 2017 for its Alzheimer’s drug candidate ALZ-801.

The change in the FDA’s guidance for Alzheimer’s disease makes designing a successful clinical trial easier, Tolar tells AIS Health. He notes that “there’s tremendous pressure on all regulatory agencies to get a treatment. No society can take care of tens of millions of people in nursing homes. The whole end-of-life decision will change if we don’t have a treatment.”

Trial Results Have Been Disappointing

The last few years have marked dispiriting results from numerous Alzheimer’s disease drug trials, with two high-profile failures coming earlier this year.

In January, Genentech, Inc., a member of the Roche Group, announced its decision to discontinue the CREAD 1 and CREAD 2 Phase III studies of its investigational anti-beta-amyloid molecule crenezumab in 1,500 people with early sporadic Alzheimer’s disease. Researchers, who based their decision on the results of a pre-planned interim safety and efficacy analysis, found that the molecule appeared safe but that it was unlikely to meet the primary endpoint of change from baseline in Clinical Dementia Rating-Sum of Boxes Score.

And in March, Biogen and Eisai Co., Ltd. said they had decided to discontinue their global Phase III ENGAGE/EMERGE simultaneous trials, designed to evaluate the efficacy and safety of aducanumab in patients with mild cognitive impairment due to Alzheimer’s disease and mild Alzheimer’s disease dementia. Again, the decision to stop the trials was not based on safety concerns. Instead, an interim analysis found the trials were unlikely to meet their primary endpoint upon completion.

“Alzheimer’s has been very unique,” says Tolar. “You need these large studies, but the problem is if they fail, they basically give up.” Over the last decade, the probability of success in Alzheimer’s drug development has been zero, while overall the probability of success in drug development is one in 200, he says. In comparison, in oncology the probability of success is one in five.

Fillit notes that the Biogen/Eisai trials were the first to use a PET scan to ensure that 100% of those enrolled had amyloid in their brains. He declines to call the trial a failure, saying instead that it was a successful trial of a failed molecule. “It proved that the drug worked — it did what it was supposed to do, which was remove amyloid,” he says. However, removing amyloid didn’t improve dementia symptoms, he explains.

The idea that it might be possible to halt or even reverse Alzheimer’s symptoms by removing amyloid plaques from the brain has driven a substantial portion of research into drug candidates for the condition over the past decade, and many drugmakers, including Eli Lilly and Co. and Pfizer Inc., also have seen well-publicized amyloid-targeting failures.

Fillit says the high-profile clinical trial discontinuations earlier this year may be the end of the road for these types of anti-amyloid molecules: “This path has been extensively studied, with tens of billions of dollars. I think it’s time to move on.”

Many Drugs Are in Development

The ADDF currently is supporting more than 100 active programs, none of which involve these types of anti-amyloid approaches, Fillit says. The foundation’s clinical trial report shows that less than 25% of trials now in progress target amyloid. “We’re seeing a lot of new approaches being tried,” he says.

Many pharma companies have dropped out of Alzheimer’s research and out of research into neurodegeneration generally, he says. Still, there’s plenty of activity: “The trend in pharma is to do more external R&D,” he says. For example, he says, Pfizer has invested $600 million in external research and development in this area.

In fact, Fillit says he is highly optimistic about the potential for an effective Alzheimer’s treatment, which he says could come in the next three to five years, since half of the currently ongoing trials are in Phase II. “Some of those [drug candidates] could be really revolutionary. Things are really coming together. I’m really excited about how things are coming together — I’ve never been more optimistic about our work.”

Fillit says he believes the leading drug candidates right now target inflammation and provide neuroprotection. In addition, some researchers are targeting epigenetics in an effort to remove damaged protein from the brain, he says.

“We also know more about prevention, and we have good evidence that Alzheimer’s is largely a preventable disease” in which lifestyle factors such as drinking alcohol and smoking play a role, he adds. Since PET scans for amyloid enable clinicians to identify Alzheimer’s in its pre-clinical stage, that could lead to prevention trials, he says.

There are 102 potential treatments for Alzheimer’s disease in clinical development, with almost three-quarters focused on novel targets beyond amyloid and tau, according to a report released in July by the ADDF (see chart, p. 10). Nearly two-thirds of them are in Phase II research trials, says the group, which has financially supported nearly 20% of these clinical- stage drugs.

For its part, Alzheon is pursuing an approach that seeks to inhibit formation of beta-amyloid oligomers, which are small, mobile clumps of beta-amyloid protein. The company’s top clinical candidate, ALZ-801, has shown promise in patients who carry two copies of the APOE4 gene that predisposes people to Alzheimer’s.

Tolar says that larger drug manufacturers abandoned the beta-amyloid approach, leaving Alzheon as “the front-runner.” The company has been working with the FDA on clinical trial endpoints, he says, and ALZ-801 has received fast track designation from the agency. Longer-term studies have shown that APOE4/4 patients exhibited sustained cognitive and functional benefits over two-and-a-half years when taking a higher dose of ALZ-801. The most common side effects were falls, nausea, urinary tract infection, diarrhea and decreased weight.

Better Biomarkers Are on Horizon

PET scans are nearly 100% effective in detecting the telltale amyloid plaques of Alzheimer’s disease, but they’re also expensive, and they don’t detect tau or other changes, such as inflammation, that can influence a patient’s cognition significantly. Researchers are developing biomarkers that look for amyloid and tau levels via blood tests, in addition to biomarkers for inflammation and for the health of neural synapses. “There’s a real explosion of interest and progress in multiple biomarkers,” Fillit says.

In July 2018, the FDA granted breakthrough device designation to Roche’s Elecsys cerebrospinal fluid (CSF) assays to support improved diagnosis of Alzheimer’s disease. The assays measure beta-amyloid and phosphor-tau concentrations in CSF. The breakthrough device designations are for use with PET scan results and measures of cognitive or functional decline, according to the FDA.

Roche researchers reported in JAMA Neurology in June that they have moved closer to a less expensive, easier-to-perform blood test for Alzheimer’s disease: In two studies, the Elecsys immunoassay system was able to accurately predict cerebral beta-amyloid status in all stages of Alzheimer’s disease, and diagnostic accuracy was further increased by analyzing APOE genotype. The blood test, combined with APOE genotype, “may be used as prescreening tests in primary care and in clinical Alzheimer disease trials to lower the costs and number of positron emission tomography scans and lumbar punctures,” the researchers concluded.

Pipeline Focuses on Variety of Targets

The drug pipeline includes molecules that target neuroinflammation, vascular problems, synapse loss and metabolic and mitochondrial dysfunction, and biomarkers are playing a key role in their development. “More affordable and accessible biomarkers, such as a blood test, eye scan or digital tool, will help to ensure that drugs are hitting their intended targets and being tested in patients most likely to respond to the drug,” Fillit says.

In 2018, the ADDF partnered with leading philanthropists, including Bill Gates, Leonard Lauder, and Jeff and MacKenzie Bezos, to create a diagnostics accelerator research initiative designed to fast track the development of biomarkers and diagnostic tools for Alzheimer’s disease and related dementias. This should help to advance the development of more targeted treatments, Fillit says, especially since — like other diseases of aging such as cancer and heart disease — a combination of drugs addressing multiple pathways most likely will be needed to effectively treat Alzheimer’s disease.

Inaugural award recipients from the diagnostics accelerator include a researcher developing a blood test that looks for two specific types of ribonucleic acids; a clinician testing a simple eye scan with a portable and inexpensive prototype camera; a researcher analyzing retinal biomarkers for neurodegeneration and disrupted vasculature; and a team developing the first ultra-sensitive blood test for brain-specific tau.

Ultimately, Fillit says, “I don’t think we will see companies trying to get a drug approved primarily on biomarkers.” Instead, researchers will use cognitive measures to determine disease progression, even when mild Alzheimer’s is being targeted, he says. However, he adds, biomarkers potentially would be used in a pure Alzheimer’s prevention model.

Contact Fillit via spokesperson Geralyn LaNeve at and Tolar via spokesperson Ray Young at

by Jane Anderson


Conveying Value of Accelerated Approval Drugs May Be Challenge for Pharma Firms

The FDA has implemented several strategies to speed drugs to market, including its accelerated approval program. While the agency has used that pathway to usher in some remarkable new drugs, questions also exist over the clinical benefits ultimately demonstrated by these therapies — assuming required follow-up trials are even conducted. As many of these drugs come onto the market with high launch prices, manufacturers must be able to convince payers and providers of their drugs’ worth.

The FDA can grant accelerated approval to therapies that treat serious conditions and fill an unmet need when they produce a positive effect on a surrogate endpoint such as a lab measurement. While these markers are not demonstrating a clinical benefit, they are thought to predict a clinical benefit. This benefit must be shown in a confirmatory trial following accelerated approval. If the trial confirms the benefit, the FDA will grant traditional approval; if it doesn’t, the drug could be removed from the market or the indication deleted from its label.

An example of a drug being withdrawn from the market was seen earlier this year with Eli Lilly and Co.’s Lartruvo (olaratumab), which received accelerated approval in 2016 for soft tissue sarcoma. After a late-stage study failed to show an improvement in overall survival, the FDA recommended in January that treatment with the drug should not be started in new patients and that current patients should consult with their provider on whether to continue on the drug. The day before the FDA released its statement, the European Medicines Agency, which gave the drug conditional approval, also recommended against new starts on the treatment; in April the EMA recommended that marketing authorization for Lartruvo be revoked. That same month, Lilly said it was withdrawing the drug from the market.

An example of an indication being deleted from a drug’s label was seen with Avastin (bevacizumab), from Genentech USA, Inc., a member of the Roche Group. The FDA initially approved the drug in 2004, and it is indicated for multiple kinds of cancers. In 2008, the agency gave it accelerated approval in combination with paclitaxel for metastatic HER2-negative breast cancer. After two late-stage clinical trials showed the drug decreased survival and increased adverse events, the FDA’s Oncologic Drugs Advisory Committee in 2010 voted to remove the breast cancer indication for the drug. In 2011, the FDA did just that, but Avastin remained on the market as a treatment for brain, colon, kidney and lung cancers; it has since been approved for additional indications.

A few recent articles have examined some aspects of the accelerated approval program.

A June 2018 article in JAMA Oncology reviewed 93 oncology indications that were given accelerated approval between Dec. 11, 1992 — the start of the program — and May 31, 2017. Of those indications, 53 were for new molecular entities. Researchers found that 51 of the 93 approvals met their postmarketing requirements and verified their clinical benefits in a median of 3.4 years after the agency gave them accelerated approval. Thirty-seven hadn’t completed confirmatory trials, and five indications were withdrawn.

Of the 37 that had not completed trials, the median time frame from approval to the cut-off date of the survey was 18.5 months — but the range was from less than a month to 12.4 years. Eight of those indications have been on the market for more than five years.

The 51 indications verifying their benefit did so most often by demonstrating progression free survival or time to progression (20), with overall survival demonstrated by 15, response rate with supportive duration of response by 13 and disease-free survival or recurrence-free survival demonstrated by three.

The researchers, who were from the FDA, concluded that “since the initiation of AA [i.e., accelerated approval] more than 25 years ago, this program has been used frequently to expedite oncology drug approvals. Our analysis indicates that use of the AA program has increased over time, and clinical benefit was not verified in only 5% of the indications approved. Thus, AA balances risk, accounts for uncertainty, and allows for regulatory flexibility to make safe and effective oncology drugs available to patients sooner than permitted through the regular approval pathway.”

An article from JAMA Internal Medicine published online in May reviewed the exact same set of drugs and indications during the same time frame. Researchers compared the endpoints used for accelerated approval with those used in confirmatory trials and noted that improvement in overall survival has long been “the benchmark” that demonstrates a drug’s efficacy.

Some surrogate measures, wrote researchers, “have been shown to be reliable predictors of a drug’s clinical advantage, such as a benefit in disease-free survival (DFS) that predicts a benefit in overall survival (OS) for patients with colorectal cancer; however, other surrogate measures have been found to be poorly associated with clinical benefits, such as progression-free survival (PFS) or response rates in advanced gastric cancer. Some measures have indicated important safety risks in other diseases, such as an elevated hemoglobin level associated with erythropoietin therapy in anemia of chronic disease. Furthermore, the measurements of many surrogate measures are more likely to be subjective and therefore prone to bias than measurement of clinical end points.”

Of the 36 out of 51 indications not demonstrating overall survival, 19 demonstrated clinical benefit using the same surrogate measure as that used in the trial leading to accelerated approval, while 17 used different measures. Researchers maintained that “it is not clear” that using the same surrogate measure in a confirmatory trial “should be used as verification of benefit. Rather, a postapproval trial that uses the same surrogate measure as its primary end point should be described as corroborating the effect on the surrogate measure, perhaps in a larger or different patient population, unless the surrogate measure has been well validated.”

Of the indications using a different surrogate endpoint, “patients and physicians continue to lack information about whether the cancer drug improves survival or quality of life, which is essential in the benefit-risk evaluation for clinical decision making, unless the new surrogate is a validated surrogate.”

Citing the FDA’s language on accelerated approval, the authors stated that while a clinical endpoint such as overall survival is not required, “postapproval studies should be designed to resolve the uncertainty of the association between the surrogate measure and clinical benefit. This standard will be difficult to achieve via postapproval studies that use the same surrogate measures as those used in preapproval studies.”

The authors recommended that one way to account for the variability in surrogate measures among different indications “would be to have a continually updated database of strengths of surrogate validation across tumor types as results from newer trials become available.”

Most recently, in August, an article in the journal Manufacturing & Service Operations Management, which is published by INFORMS, an international association for operations research and analytic professionals, took a broader look at the issue. Researchers noted that the Government Accountability Office found that among 90 drugs on the market via accelerated approval between 1992 and 2008, 36% of required confirmatory studies were not completed by 2009 and half of those took an average of 5.5 years to begin. Noncompliance reasons, they wrote, include little incentive to conduct trials whose outcomes “are uncertain and there is no significant improvement on profitability.” Confirmatory trials also require “considerable effort and money” to conduct. And the “onerous process” that the FDA must go through to withdraw a drug or indication “does not necessarily compel a manufacturer to act.” Thus, the “FDA faces substantial risk of an ineffective drug remaining on the market indefinitely when a manufacturer does not comply with its requirement to complete its post-market study, thereby compromising the original purpose” of accelerated approval.

The authors maintained that a “deadline-dependent user fee menu” that’s tied to confirmatory study deadlines as opposed to the current fixed fee for an FDA application review would increase manufacturers’ compliance. If that approach is not possible, the agency, using an analysis presented in the article, can “calculate an optimal single deadline that can be imposed as a simple substitute to the menu.”

Concerns around accelerated approval exist among both payers and providers, and manufacturers need to alleviate these concerns to help ensure uptake of their drugs.

Payers have two key concerns, maintains Jason Shafrin, Ph.D., senior director of policy and economics at Precision Xtract: “(1) Will the benefit from the clinical trial translate into health benefits for patients in the real world, and (2) how will new treatments affect budgets?”

On the first question, Shafrin points to an article published in 2017 in the International Society for Pharmacoeconomics and Outcomes Research journal Value in Health on which he was lead author that examined how patients and physicians assessed durable survival gains. That research, he tells AIS Health, “found that the surrogate endpoints used in most accelerated approval trials were good but imperfect proxies of overall survival. Specifically, effectiveness observed in the real world was 16% lower than what was observed in clinical trials when trials used surrogate endpoints such as progression-free survival or time to progression. This ‘adjustment factor’ for surrogate endpoints varied depending on tumor type, the size of the clinical trial, treatment line of therapy and other factors.”

On the issue of drug prices, Shafrin points to research showing that the price of a new oncology drug in 2015 was about three times the price of a new cancer drug in 1997. Payers, however, should put data about the rising cost of cancer drugs into context,” he says, noting that same research “shows that most of these new cancer treatments are targeted therapies that are indicated for smaller patient populations. In fact, the indicated population for a typical cancer drug in 2015 was 90% smaller than the indicated population of a cancer drug in 1997. Further, total payer spending on a given new cancer drug has actually fallen over time.”

Still, says Amit Agarwal, managing director and co-lead of the next generation therapies practice at Deloitte, from the perspective of a manufacturer developing cell and gene therapies and negotiating market access agreements, “the cost of the therapies even after they have been approved can materially impact payer economics. Most manufacturers have seen payers go to [an] individual approval mechanism rather than approve therapies on a blanket approval. This means extensive review of the patient records, previous treatments and eligibility for the treatments.”

For drugs launching with accelerated approval, payers are looking for manufacturers to provide “longer-term endpoints focused on overall survival,” as well as data showing that the treatments “actually reduce the need for future medical treatments,” he tells AIS Health. “In many cases, the cost-effectiveness arguments made by manufacturers for many of these curative therapies do not resonate with payers, as the churn in insurance coverage every few years means that the payer who pays for a therapy will not gain the benefit of a patient who has been cured of the disease.”

Shafrin agrees. “Payers are increasingly looking for new cancer treatments that are not only safe and effective but also provide good value for money,” he says. “The advent of new value assessment groups in the United States such as the Innovation and Value Initiative and Institute for Clinical and Economic Review are gaining prominence. These groups use advanced economic models to monetize the net benefits of treatments less their cost.

“Thus, payers increasingly expect manufacturers to set prices in line with treatment value,” he continues. “Some payers are also exploring the use of outcomes-based contracts to make sure the health benefits that occur in the clinical trial translate to real-world settings.” Ensuring that payers do not put up access barriers to these drugs “requires an extremely difficult balance from manufacturers,” says Agarwal. “In several cases, patient advocacy groups have taken the lead in ensuring coverage and reimbursement (e.g., Spinraza). In other cases providers who face nonpayment have forced patients to agree to cover costs if payers refuse (e.g., Yescarta and MD Anderson). To smooth the process, manufacturers have to provide the appropriate data package to providers and physicians so they can get approval from payers.”


FDA’s Project Facilitate Aims to Improve Access to Unapproved Therapies

The FDA recently unveiled a pilot program to help physicians who are treating people with cancer gain access to unapproved therapies. Project Facilitate is a call center connecting FDA oncology staff with physicians to help them submit an expanded access request for a patient. The program, maintains the agency, will be especially helpful for patients not eligible for a clinical trial or those who do not live close to a trial location.

The expanded access pathway is aimed at allowing people with an “immediately life-threatening condition or serious disease or condition” to be able to have access to an investigational drug or medical device. Also known as compassionate use, the approach has been an option since 2009, but the process, says the FDA, “may appear confusing or burdensome.” Project Facilitate is focused on simplifying the process, it says.

“Most cancer patients interested in new, cutting-edge treatments will enroll in clinical trials,” points out Jason Shafrin, Ph.D., senior director of policy and economics at Precision Xtract. “For patients who live in underserved communities or those who are unlikely to live near clinics where clinical trials occur, access to these new therapies is often difficult.”

“While at first it may seem odd that the FDA would facilitate access to treatments that are not yet FDA-approved, they are in fact responding to patient demands for quicker access to these treatments,” he tells AIS Health. “Academic research shows that patients with terminal illnesses are less risk-averse than the typical patient. Our research showed that when individuals are presented with a choice of two therapies with the same average survival, but one has a chance for both longer and shorter survival, patients typically choose the treatment with a chance for long-run durable survival gains, even if that treatment is riskier. Thus, Project Facilitate shows that the FDA is attempting to be more patient-centered in giving patients more options for accessing novel treatments.”

“From a manufacturer perspective, the compassionate use pathway opened up by Project Facilitate seems to be much more focused on the ‘Right to Try’ law as opposed to expanded access programs,” says Amit Agarwal, managing director and co-lead of the next generation therapies practice at Deloitte. That pathway does not require FDA and institutional review board review of a proposed treatment protocol or reporting severe adverse events to the FDA except for in certain situations.

“The Right to Try is supposed to have less cumbersome reporting and PV [i.e., pharmacovigilance] requirements but also does not provide a pathway to use the results from the program to improve drug development and approval processes,” Agarwal tells AIS Health. “In particular there are issues around data capture” in Right to Try. He says multiple companies have used expanded access programs, “and their data is often used in regulatory filings. There is also a concern with both programs [that] if adverse events occur with the use of any drug under the program, could that lead to manufacturers’ approvals being delayed? The agency has indicated the delays have been minor, but manufacturer concerns still exist on the legal responsibility to capture adverse events.”

Contact Agarwal through Ellen Conti at and Shafrin via Tess Rollano at

by Angela Maas


As with payers, providers also have cost concerns. Agarwal points out that physicians experiencing treatment delays due to issues with initial reimbursement efforts and the subsequent impact on cash flow “often have to budget for these very expensive drugs from charitable foundations.…If the drug has to be made to order for patients, then the buy and bill model can become a financial challenge.”

Another issue that providers have with accelerated approval therapies is getting access to “as robust evidence as possible demonstrating that treatments are safe and effective,” says Shafrin. “However, drugs with accelerated approval often are approved based on trials using surrogate endpoints with short follow-up times. Physicians may be skeptical of this evidence.” For example, he points out, the American Society of Clinical Oncology’s Value Framework “discounts efficacy benefits by 20% for trials that use progression-free survival endpoints and by 30% for trials that use response rate relative to trials that use overall survival endpoints.”

However, he says, providers “may not be taking into account the cost of collecting additional information in clinical trial settings. Requiring more confirmatory clinical trials or endpoints requiring longer follow-up would add to R&D costs. Higher R&D costs would lead to either higher prices or fewer manufacturers risking investing in cancer treatment development. While high-quality evidence is needed, one should weigh the benefits of collecting more information with their costs.”

Providers also may face logistical challenges with these treatments. “For many of these accelerated approval drugs, there is a site-certification process that manufacturers require providers to complete. This includes audits that they are following procedures and templates,” explains Agarwal. “Providers are also a very important part of the long-term patient registries that have to be established in lieu of requiring Phase III trials. Some of these registries for gene therapies have required 15-year follow-ups. Not every provider has the capability to participate in these types of therapies.”

Another stakeholder group whose considerations need to be taken into account with these drugs is patients. Noting that “patients are a heterogeneous group,” Shafrin cites a study funded by the Innovation and Value Initiative, which was launched in 2016 by Precision Health Economics. It and Precision Xtract are units of Precision Medicine Group.

The study, which was based on focus groups with people with non-small cell lung cancer, “found that these patients not only wanted treatments that were safe and effective but also treatments that were affordable throughout the patient journey,” he explains. “Patients also placed high value on convenient administration and a more tolerable side-effect profile. Perhaps most importantly, patients are looking for care personalized to their individual needs and goals. Thus, while payers and physicians are looking to increasingly standardize care through treatment pathways and access restrictions, patients themselves want more flexibility in treatment choice to tailor treatments to their needs.”

Shafrin says there are various ways that payers and providers can take into account patients’ perspectives. “For physicians, following shared decision-making best practices is a first step for insuring that patient needs are met. For payers, who set coverage policies for populations rather than individuals, other tools are needed. For instance, payers can conduct qualitative patient focus groups and engage directly with patient advocates to help determine which treatment attributes are most important to patients. Payers can also use multicriterion decision analysis (MCDA) tools to determine which treatment profiles patients with different profiles would prefer. Collaboration with the Innovation and Value Initiative helped to create an MCDA tool for identifying the preferred treatment for patients with EGFR+ non-small cell lung cancer. Setting formularies so the vast majority of patients get their preferred treatment should be a payer goal to make their coverage policies more patient-centered.”

Contact Agarwal through Ellen Conti at and Shafrin via Tess Rollano at

by Angela Maas


Large Employers Are Worried About Pipeline of Costly Drugs

For large, self-insured U.S. employers, their No. 1 concern related to pharmacy benefits is how to finance treatments that come with seven-figure price tags.

That’s one finding of the National Business Group on Health (NBGH) 2020 Large Employers’ Health Care Strategy and Plan Design Survey, the results of which were unveiled on Aug. 13. Among the 147 employer respondents, 86% said they were either concerned or very concerned about “the impact of million-dollar treatments getting approved by the FDA,” such as Novartis’ $2.1 million spinal muscular atrophy treatment, Zolgensma (onasemnogene abeparvovec-xioi).

“The pipeline is looming — there are an estimated 14 new therapies in excess of $1 million each that are on the docket for FDA approval in the coming months and years,” Ellen Kelsay, NBGH’s chief strategy officer, said at a press briefing to review survey findings held in Washington, D.C.

No employer would argue that therapies like Zolgensma aren’t valuable, but they still must grapple with how to cover those pricey drugs, she added. Nearly a quarter of large employers polled said that as of 2019, they are delaying the inclusion of newly launched treatments from their formulary to enable their PBM or health plan to better determine the treatment’s efficacy and safety, the NBGH survey noted.

Purchasing stop-loss insurance for specific drugs and creating indication- and outcomes-based pricing contracts have not been as favored for 2019 or 2020, but 22% and 34% of employer respondents plan to take those approaches, respectively, for 2021/2022.

Kelsay also highlighted the fact that 46% of employer respondents in the 2020 survey indicated they would consider a role for government in helping to negotiate prices for high-cost therapies.

“I think that’s a reflection of the frustration employers have” with how to finance high-cost treatments, NBGH President and CEO Brian Marcotte said at the briefing. ”It’s not a question of are these good therapies. It’s a question of what can society afford — not just what can employers afford.”

When NBGH convenes a pharmacy benefit management committee to talk about such subjects, “employers start surfacing questions like, ‘well, dialysis today is picked up by Medicare; are there certain conditions that should be, just based on what they are and what they cost,…somehow picked up in a different way than how they’re funded today,’” Marcotte said.

NBGH’s survey also revealed that large employers are increasingly taking a “defer to partners” approach to drive change in the health care system — or implementing what their health plan and PBM present as the latest innovations. Figuring out how to finance high-cost therapies is one of the key areas in which employers are looking to their health plan and PBM partners for assistance, Marcotte noted.

In general, Kelsay said, employers responding to NBGH’s survey “placed a significant degree of emphasis and focus on what they’re doing to manage their specialty drug spend.”

When it comes to specialty drug management, the most notable area of growth is in the use of prior authorization (PA) for medications billed under the medical benefit — which typically are those therapies administered in a clinical setting. The share of employers using PA for drugs under the medical benefit rose from 36% in 2019 to 59% in 2020.

Other popular options to tame specialty drug spending include site-of-care management and high-touch case management, Kelsay noted.

Another major area of concern for employers in the pharmacy-benefits realm is the impact of drug coupons and patient assistance programs on consumer behavior, the NBGH survey stated. While copay coupons can be beneficial to individual consumers, the problem is that such discounts can drive people to take higher- cost branded drugs over generic alternatives, Kelsay said.

“The other concern they have is these copay cards bypass the plan design,” she said. “So they weaken the integrity of the plan by not applying to the deductible, historically, and not applying to out-of-pocket maximums.”

Thus, many large employers are turning to “copay accumulator” programs, which generally apply the value of a copay coupon to an employee’s deductible as well as their out-of-pocket maximum, according to Kelsay. Among respondents to NBGH’s survey, 34% said they already had such a copay accumulator program in place in 2019, another 4% said they were adding one in 2020, and 15% said they were considering one for 2021/2022.

Meanwhile, 11% of large employers said they’ve implemented a copay maximizer program to address drug coupons. Usually, this involves creating a variable member copay to “smooth out” the value of the assistance over the course of the plan year, the NBGH survey noted.

The survey also addressed the subject of prescription drug rebates, which has been a top-of-mind topic this year given the now-tabled proposal to revamp the rebate system in Medicare Part D.

“Many of our employers said that they would prefer a rebate-free world, but in the world where rebates do exist, they’re looking at bringing those rebates forward to the point of sale so that an individual that’s taking a medication that is rebated actually derives the full value of that rebate,” Kelsay said at the briefing.

According to the NBGH survey, 60% of large employers either have a point-of-sale rebate program in place or are considering doing so in the next three years. Among those that don’t yet, the main challenge “remains how to financially account for the shift of rebate value from an overall plan benefit, thus reducing costs to all employees, to one that more precisely benefits members filling rebate-enabled prescriptions,” the report noted.

During a Q&A with reporters at the Aug. 13 briefing, Marcotte said employers’ plans for rebates going forward haven’t really been affected by the Trump administration’s decision to pull its rebate proposal. That rule wouldn’t have been very effective anyway since it relied on “the goodwill of the drug companies” to lower their list prices, he said.

Marcotte also argued that employers’ move to high-deductible health plans is putting the spotlight on high drug costs. “Drug price has always been a challenge, but it was masked by copays for the consumer,” he said. “Once consumers were exposed more to drug price, now you see a lot of energy and focus on drug pricing.”

View the report at and contact Marcotte and Kelsay via Ed Emerman at

by Leslie Small

This story was reprinted from AIS Health’s biweekly publication RADAR on Drug Benefits. For more information, visit

As New Formulary Exclusions Are Unveiled, Drugmakers Need to Communicate Value

September 25, 2018

With 48 new exclusions on its 2019 National Preferred Formulary (NPF), Express Scripts Holding Co. is getting more aggressive in its attempt to broaden access to pharmaceuticals and bring value to its clients. However, as the PBM expands this strategy to more specialty drugs, including some for rare conditions, manufacturers have their work cut out for them in educating payers on their medications’ worth as they vie for formulary placement.

The new exclusions are on top of the 196 drugs Express Scripts already is excluding in 2018.

With 48 new exclusions on its 2019 National Preferred Formulary (NPF), Express Scripts Holding Co. is getting more aggressive in its attempt to broaden access to pharmaceuticals and bring value to its clients. However, as the PBM expands this strategy to more specialty drugs, including some for rare conditions, manufacturers have their work cut out for them in educating payers on their medications’ worth as they vie for formulary placement.

The new exclusions are on top of the 196 drugs Express Scripts already is excluding in 2018. In 2019, the NPF will cover more than 25 million lives and will include 3,886 medications. The PBM estimates that it will save $3.2 billion. Those plans that have continuously used the NPF since Express Scripts introduced it in 2014 will save $10.6 billion total through next year, projects the company.

The PBM says it will make public the full list of 2019 excluded products on or before Sept. 5.

“Despite promises to limit price increases, drugmakers are trying to game the market by delaying generic competition, blocking access to safe and effective biosimilars, and coyly deferring — not cancelling — list-price increases,” wrote Steve Miller, M.D., chief medical officer at Express Scripts, in an Aug. 7 blog on the new list of exclusions. “This is why our work to expand access and maximize value is more important now than ever.”

He maintained that within the 2019 NPF, “we have identified opportunities to address these issues — and others — as we champion broad, affordable access to innovative treatments. Payers save money and patients achieve better outcomes because of our work. In short, our NPF is the greatest example of how we make the market work for payers and patients by leveraging competition and directing members to medications with the lowest net cost.”

The PBM states that it passes on about 95% of “all pharmaceutical purchase discounts, price reductions and rebates back to our PBM commercial and health plan clients and their members. This has helped our clients achieve a record low drug trend of 1.1 percent for the first half of 2018.” Among the new exclusions are the following:

✦ Novartis Pharmaceuticals Corp.’s multiple sclerosis drug Extavia (interferon beta-1b);

✦ Four factor VIII recombinant products for hemophilia: Eloctate from Bioverativ, a Sanofi company; Shire US Inc.’s Recombinate; and Pfizer Inc.’s Xyntha and Xyntha Solofuse;

✦ AbbVie Inc.’s hepatitis C medication Mavyret (glecaprevir/pibrentasvir);

✦ CSL Behring LLC’s Berinert (C1 esterase inhibitor, human), indicated for the treatment of acute abdominal, facial or laryngeal hereditary angioedema (HAE) attacks in adult and pediatric patients; and

✦ Gilead Sciences, Inc.’s HIV drug Atripla (efavirenz/emtricitabine/tenofovir disoproxil fumarate).

Express Scripts has a formulary exception process by which patients who cannot use a preferred therapy can seek an exception. The company says about 12% of all its members under the NPF seek an exception annually; the exclusions impact an average of 0.2% of a plan’s members.

Jennifer Luddy, a spokesperson for Express Scripts, tells AIS Health that “no formulary decision is based strictly on price. First, our independent P&T [i.e., pharmacy & therapeutics] committee reviews medications and makes recommendations based on clinical evidence. Medications they deem ‘mandatory include’ are included. Medications which are a ‘may add’ have therapeutic alternatives available, and then we can make a decision based on price.”

“After clinical considerations, formulary preference is given to high-value therapies with the lowest net cost, achieved through low list price, rebate, or both,” says Express Scripts.

According to Jeremy Schafer, senior vice president at Precision for Value, “The inclusion of categories like HIV, hereditary angioedema and hemophilia was certainly a surprise. Rare disease categories such as these were commonly seen as too sensitive and individualized to be managed by something as blunt as an exclusion. Even though Express Scripts is grandfathering current users, this move represents an aggressive step in the management of rare disease drugs.”

But with multiple therapies in hemophilia, HIV and HAE, why shouldn’t PBMs exclude some of them?

Schafer tells AIS Health that “a primary reason may be that patient care in these diseases is so individualized. The diseases included here are very nuanced, and patient presentation is highly variable. For categories like HAE and hemophilia, product supply, site of care and variances in dose play additional roles. As a result, different drugs often have carved out niches in unique subpopulations. An exclusion doesn’t take into account these nuances and instead blocks out affected products. Although appeals for coverage may be made, it is a blunt instrument in drug management.”

Within the HAE space, says Luddy, “we leveraged increased competition in that class to maintain access to a variety of therapies (there are eight preferred alternatives in that class) at a lower cost.”

However, “Some patients respond better to certain products, so physicians might experiment with one or more products to see which ones are most effective in managing the disease and symptoms,” Elizabeth Duruz, R.Ph., director of clinical program services at Diplomat Specialty Infusion Group, a brand of Diplomat Pharmacy Inc., tells AIS Health. For example, some patients may think that one HAE product works really well for facial attacks, but another works better for abdominal attacks.

Within the hepatitis C class, in addition to Mavyret, the PBM also will continue to exclude Bristol-Myers Squibb Co.’s Daklinza (daclatasvir), Janssen Therapeutics’ Olysio (simeprevir) — which Janssen discontinued earlier this year — and Gilead’s Sovaldi (sofosbuvir). On the 2019 NPF are Gilead’s Epclusa (sofosbuvir/velpatasvir), Harvoni (ledipasvir/sofosbuvir) and Vosevi (sofosbuvir/velpatasvir/voxilaprevir) and Merck & Co., Inc.’s Zepatier (elbasvir/grazoprevir), which currently is excluded.

“We have successfully driven down the cost to cure hepatitis C over the last four years, and once again we’re taking action to further lower client costs,” says Luddy. “In July 2018, Merck announced a 60% price reduction for Zepatier that will take place in the fourth quarter of 2018. That will make Zepatier the lowest-cost agent for a 12-week course of therapy. Because of this market dynamic shift, Zepatier will be added to formulary effective Jan. 1, 2019. At the same time, Mavyret will be excluded on the NPF. All current utilizers of Mavyret will be grandfathered to allow completion of their treatment course. For 2019, the Express Scripts NPF will have a combination of the market leading products (Harvoni and Epclusa) and the low-cost leader (Zepatier) on the formulary, as well as Vosevi.”

Exclusion Is ‘Patient Unfriendly’

Adam Fein, Ph.D., author of the Drug Channels blog and CEO of Drug Channels Institute, noted in an Aug. 16 blog that excluding Mavyret is a “patient unfriendly change to the hepatitis C category.” That’s because while that therapy is indicated for genotypes 1 through 6 — as is Epclusa — Zepatier is indicated for only genotypes 1 and 4. Harvoni is indicated for genotypes 1, 4, 5 and 6.

As he wrote in his blog, “Until recently, Mavyret had the lowest list price. AbbVie launched Mavyret in 2017 with a wholesale acquisition cost (WAC) list price for a one-month supply that was more than 50% lower than the list price of other therapies.” Citing Pharmaceutical Technology, Fein says that the list price for an eight-week course of Mavyret is $26,400, and a 12-week course is $39,600. That’s compared with the 12-week Harvoni list price of $94,500 and Epclusa’s $74,760. “Rebates can be substantial, so the list prices do not meaningfully reflect the net cost to a payer,” he notes.

“Express Scripts has excluded Mavyret, the lowest list price product that can treat the one in four patients who has HCV genotype 2 and 3,” explained Fein. “These patients can’t take Zepatier, which treats only genotypes 1 and 4. They will therefore most likely be treated with Harvoni, a product with a higher list price and presumably high rebates.”

Because discounts are reflected in a drug’s average sales price, this “translates into savings for a payer compared with paying from WAC,” notes Schafer.

Fein also points out that “patients with commercial insurance often have prescription drug deductibles and coinsurance, so their out-of-pocket costs are linked to undiscounted, pre-rebate list prices. Patients with HCV [i.e., hepatitis C virus] genotypes 2, 3, 5, and 6 will face higher costs due to these formulary exclusions. They won’t benefit from a low net price. If physicians end up prescribing Harvoni or Epclusa over Zepatier, then patients with genotypes 1 and 4 will also get stuck with higher out-of-pocket costs tied to the higher list prices.”

PBM Says Copay Card Is Option

When Fein queried Express Scripts about patients’ higher out-of-pocket costs due to Mavyret’s exclusion, he says a spokesperson told him that “the copay card would be an option.”

The HIV market continues to grow, states Luddy, who notes that the therapeutic category boasts more than 25 FDA-approved antiretrovirals. Express Scripts will exclude Atripla and prefer Gilead’s Biktarvy (bictegravir/emtricitabine/tenofovir alafenamide), Genvoya (elvitegravir/cobicistat/emtricitabine/tenofovir alafenamide), Odefsey (emtricitabine/rilpivirine/tenofovir alafenamide) and Stribild (elvitegravir/cobicistat/emtricitabine/tenofovir disoproxil fumarate); Mylan N.V.’s Symfi (efavirenz, lamivudine and tenofovir disoproxil fumarate) and Symfi Lo; and Triumeq (abacavir/dolutegravir/lamivudine) from Viiv Healthcare, a GlaxoSmithKline company.

“The growing trend is approval of single tablet combinations containing two or more medications,” Luddy says. “These single tablet combinations have shown increased adherence and virologic suppression in clinical studies. In 2018, the approval of Symfi and Symfi Lo created an opportunity to manage the cost of Atripla, as both drugs are clinically very similar. From a cost perspective, Symfi and Symfi Lo have a net cost that is much less (40%) than that of Atripla.”

According to Schafer, “The challenge for rare disease manufacturers is to get payers to see beyond the price tag, which is often considerably higher on an individual drug basis than treatments for more common conditions. Manufacturers can start by educating payers on the size of the population and budget impact.

“However, as the health care marketplace evolves to one based on value, rare disease drug manufacturers need to tell a more comprehensive story on the clinical value of the product, what costs may be avoided (both medical and pharmacy), changes in health care resource utilization, as well as the long-term benefit of therapy,” he continues. “All these elements should be incorporated into a comprehensive value story that will resonate with the payer. This approach is similar to drugs for common conditions but may also need additional disease education as rare diseases may not be known to the payer, especially if the drug is the first option to treat the condition.”

Luddy tells AIS Health that those members on the excluded factor VIII, HIV and hepatitis C excluded drugs “will be grandfathered per guidance from our internal clinical team and our independent pharmacy & therapeutics committee.” However, this doesn’t apply to all the excluded drugs but rather only “for those where it is clinically necessary.” The PBM also will grandfather “a few others” outside these three therapeutic classes.

The other PBM with a large list of exclusions, CVS Health, will exclude 23 additional drugs in 2019 and will add four that are excluded this year back onto its Standard Control Formulary, according to spokesperson Christine Cramer. The PBM’s list of exclusions will be available around Oct. 1.

View the Express Scripts blog at and the list of new exclusions at View the 2018 NPF exclusions at View Fein’s blog at Contact Schafer through Tess Rollano at

by Angela Maas  


Including Patients’ Perspectives in Value Assessments Is Key for Pharma Success

When payers are assessing medications for their perceived value, a variety of factors may go into the process. Many of them will utilize assessments done by third-party organizations that specialize in drug assessments, which often will emphasize economic considerations when determining a product’s value. One aspect that has been overlooked to some extent is that of patient values and perspective, although more groups now are calling for this information. Assessments that also take this into account ultimately will be of more value to payers and providers, particularly as medication becomes more personalized, and manufacturers should make sure they are gathering this information, say industry experts.

The Institute for Clinical and Economic Review (ICER) is arguably the best-known value-assessment organization within the United States. Others include the National Comprehensive Cancer Network’s NCCN Evidence Blocks, the American Society of Clinical Oncology’s ASCO Value Framework, DrugAbacus from Memorial Sloan Kettering Cancer Center’s Drug Pricing Lab and Precision Medicine Group’s Innovation and Value Initiative, according to Ross Maclean, M.D., Ph.D., senior vice president and head of medical affairs at Precision Health Economics.

While the FDA evaluates three aspects of value for a pharmaceutical — safety, efficacy and manufacturing quality — these other organizations build on that data with information gleaned from how the drug is used in a real-world setting, says Maclean. “Often called effectiveness, this is a broad term that extrapolates the clinical trial efficacy to a real-world, routine practice setting where the unique characteristics of each and every patient come into play (e.g., genetics, socioeconomic setting, comorbidities, medication adherence and other lifestyle factors). In addition, other entities may look at the comparative effectiveness of different therapeutic options (not just drug vs. drug but drug vs. lifestyle/device/other interventions), as well as the economic value a drug offers.”

Payers’ Use of ICER Data Is Increasing

He tells AIS Health that his company conducted an assessment of pharmacy and medical directors at commercial health plans in the U.S. on their use of ICER analyses in making decisions about policy development, formulary review and preferred product selection. Participants were surveyed in October 2016 and April 2018, and between those dates, “there was a more than 50% increase in the overall use of ICER analyses. More importantly, more than 80% of payers indicated that they use ICER analyses in drug management decisions, which was consistent over the 18-month period. Of note, nearly all those who had never used an ICER analysis indicated that the main driver for not doing so was that their decisions were solely focused on cost (vs. value). That said, we don’t see payers solely use ICER assessments for drug management decisions.”

Epiphany, a company that performs health economics, reimbursement and market access studies, has conducted interviews with more than 100 payers over the past 18 months. According to Lisa Kennedy, Ph.D., chief economist at the firm, such assessments are only one of the tools respondents use to make decisions about formulary placement, prior-authorization requirements and value-based contracts. “Payers vary in their use of value frameworks — some do not consider these at all, especially for orphan drugs, whereas other payers might use a value framework assessment to learn more about a product,” she says. “The most common comment from payers is that value framework assessments are not specific enough to the situation and population that a payer faces and are therefore less relevant.”

Kennedy points out that “most of these frameworks rely on a multitude of assumptions and modeling, such that there can be a lot of uncertainty in a value assessment when a specialty drug is launched. Additionally, value framework assessments are often performed from the perspective of the payer which means that other aspects of a specialty drug are not captured, including increased capacity for providers and greater patient productivity. This inevitably can mean that drugs that have significant offsets to a payer will be prioritized over drugs that have high costs offsets to other stakeholders (e.g., to the employer, patient, social services, etc.). Overall, value assessments taken at face value in the absence of other information can be quite dangerous in that it could incorrectly restrict the right product or enforce use of the wrong product leading to harm to patients.”

“Cost-value assessments are integral to health spend management,” says Bill Sullivan, principal consultant at Specialty Pharmacy Solutions LLC. “The assessments, however, should be the last step in a formulary review process once the value of the target drug(s) is/are established. Since specialty pharmacy now represents 50% of drug spend — and greater than 50% in certain therapeutic categories — rational protocols are essential.”

“Formulary review committees have been frustrated for years when it comes to weighing comparative values,” Sullivan tells AIS Health. “A new oncology therapy that promises only a few additional days/weeks of life at a substantial increase in cost have been a challenge for years. We are now entering a new era where next-generation specialty pharmacy therapies not only promise marginal improvements over earlier generation therapies but significant clinical improvements and even cures (e.g., hepatitis C). There is clear evidence that coverage decisions are now being made purely on cost.”

This can be a problem, he says. “Payers rely heavily on dossier assessments (efficacy) but are inconsistent when it comes to cost-effectiveness. Many earlier generation specialty pharmacy therapies merely treat symptoms. How can one calculate the cost-effectiveness of a cure?”

“I wouldn’t necessarily put price in the same category as value,” says Kennedy. “What value frameworks attempt to do is look at the benefits that a new product brings and then evaluate this against price. ICER, for example, employs a willingness to pay threshold and then calculates a price on the basis of this.”

‘Real Issue’ Is ‘How Value Is Calculated’

According to Kennedy, “The real issue here is how value is calculated.” She points out that many health technology assessments use the quality-adjusted life year (QALY) “as the basis of outcome or benefit. It’s as complicated as the concept sounds. The purpose of using the QALY is to be able to compare all innovations with a common unit of benefit. The problem is that QALYs are hard to understand and exhibit extraordinary methodological and practical problems: They aren’t reliable across the same patients over time, across different patients and, additionally, fall down when required to measure more difficult things such as QALYs in the elderly or the very young. QALYs are often mapped from quality-of-life measures collected in a trial. What can happen is that the quality-of-life instruments used are not sensitive enough to capture meaningful change for the patient.”

As an example, she cites a recent “publication in a rare pediatric disease, where patients with a rare disease reported higher QALYs than those without the disease: Given the debilitating nature of this disease, clearly the ability to capture patient perspectives was compromised (either that or we all need to get a rare disease to improve our quality of life). This means that value frameworks that use the QALY are subject to a high degree of uncertainty.”

“Patient perspective is critical because value assessments do not address patient personal circumstances,” maintains Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates. He notes that many organizations, including the National Cancer Institute and the International Society for Pharmacoeconomics and Outcomes Research, are focusing on how to better incorporate the patient perspective.

“Payers are sensitive to their members, especially those with chronic illnesses that can easily become train wrecks if they end up in the ICU,” states Sullivan. “Cost effectiveness, therefore, should include that risk factor — not just a drug/drug cost-effectiveness assessment. This is the same argument that was first made when we started to talk about QALY analysis back in the ’90s.”

“Too often, value assessments place greater emphasis on cost compared with humanistic value or societal impacts, such as quality of life and productivity,” Maclean tells AIS Health. “Patient factors are often critical to successful treatment, and it is important to understand that patient perceptions and attitudes toward disease burden (including lifestyle impact), mode of administration, treatment frequency and side effects may all affect adherence.”

Kennedy agrees that incorporating the patient perspective into these assessments “is incredibly important. Patients continue to feel like passengers in the ‘machine’ of health care delivery, and some of this is mirrored in value framework processes. Many value frameworks fall down in engaging patients.”

For example, she tells AIS Health, “I attended a recent voting session in migraine for a well-known assessment non-profit group. Migraine patients stated that both during the assessment, the meeting and afterwards that they did not feel like they had the chance to fully vocalize their opinion, they didn’t feel like their comments were actioned, and they didn’t have any representation on a decision that would directly affect them. There was a sense that patients were diminished in this process. It should be the other way around.”

Gathering patient data can be a challenge in some respects, though. Sullivan notes that “specialty pharmacies are actually limited to what data they can gather that will pass the high clinical review standards of payers.” Much of the information they gather is reported by patients — which is “useful but not iron clad,” he says — and unless the drug is available only through a limited-distribution program offered by a single specialty pharmacy, data on it will not be representative of the entire patient population. “Only recently have specialty pharmacies been able to gain access to lab reports. Details on hospital admissions, and emergent doctor visits are also not easily accessed. Even with access to EHRs, specialty pharmacies simply aren’t paid enough to pull together a comprehensive, therapy-specific, patient population health analysis — and certainly not drug/drug.”

According to Maclean, “One approach to gaining insight on the patient perspective is a discrete choice experiment that assesses the trade-offs patients are willing to make and the value they place on different outcomes. These types of experiments can uncover creative sources of value, such as the value of hope, the value of a productive life, and the value of living to receive the next treatment advance.” Conventionally, he says, patient data has focused on improvements in the condition the treatment is indicated for and on improvements to broader patient-reported quality-of-life measures. Both of those, he notes, “can include physical as well as psychological/mental health-related measures. Other patient data can include productivity (e.g., work-related short-/long-term disability), the burden on caregivers/family and engagement in social/community activities typically beyond the scope of a single medical illness but important elements of a full, active and healthy life.”

Post-launch drug data is usually focused on the following, says Maclean:

✦ “Adherence: Do patients take the drug or not in a real-world setting? Recall that in the confines of a clinical trial, patients are closely observed, and it is commonplace for adherence to be well over 90%, whereas in a real-world setting, adherence of 50%-80% is more common.

✦ “Persistence: Do patients take the drug for as long as they are supposed to? Similar to the adherence challenge, persistence in a real-world setting can dramatically drop. It is a recognized problem that for medicines requiring long-term use, persistence can drop to 50% or lower.

✦ “Real-world impact: In effect, do the efficacy endpoints translate to real-world benefit? This can be assessed from medical records (chart review) or real-world observational studies or surveys. These pose meaningful practical challenges in terms of patient follow-up over time and the emergence of comorbid medical conditions that impact patient health yet were previously not studied in the clinical trial phase of research.”

These data, he says, “are important to a payer as each factor can impact the likely clinical benefit and cost to the payer of making the drug available. In addition, drug-drug interactions in a real-world setting are almost infinitely more varied than in the clinical trial, and payers want to avoid harm through inadvertent erroneous prescribing and its consequences.”

Kennedy says that payers her company has spoken with “are more likely to take into account the clinical efficacy, safety and tolerability of a specialty drug. Although important to patients, caregivers and their dependents, payers have expressed to us that it is harder for them to understand QALYs and quality-of-life data. In the areas of [central nervous system disorders] and behavioral health, patient data become particularly important as there are less objective diagnostics and measures of improvement as in many cases in vitro and good imaging studies don’t exist or aren’t well validated yet.”

Gathering patient data is particularly important now, as multiple treatments, many of them oncolytics, are launching with only Phase II data, points out Kennedy. “Usually every effort is made to get as much patient data before launch as possible; however, time constraints and trial design can limit what it is possible to collect. After launch, much more data can be collected on patients, and, equally, there is greater understanding of how surrogate endpoints relate to long-term patient outcomes and quality of life.”

Manufacturers, says Sullivan, “are very sensitive to gain optimal formulary approval of a new drug. The more information they can provide a payer, the better the argument they can make about the clinical value of their product as well as its cost-effectiveness. Unfortunately, more and more new specialty pharmacy therapies are orphan drugs with scant clinical trial data — e.g., FDA approval granted on a trial including less than 100 patients. These uber-expensive orphan drugs are nearly impossible to assess as a result. It is no surprise that we are seeing more guarantees/refunds based on patient-by-patient outcomes.”

Contact Kennedy at, Maclean through Tess Rollano at, Rubinstein at and Sullivan at

by Angela Maas  


Pharma Companies Benefit From Accredited Pharmacies

What makes specialty pharmaceuticals “special”? Other than cost — the primary criterion — it is often the tangled combination of patients’ health and personal situations, comorbidities, a complex form of drug delivery — often infusion — and particular delivery and handling requirements to manage product integrity and toxicity concerns. These, in turn, call for a greater number of pharmacy services — thus, the specialty pharmacy.

But what makes a specialty pharmacy ”special”? Besides the reality of being able to deliver the personalized follow-on services, the acknowledged way of signifying those capabilities is for the pharmacy to obtain accreditation from one or more third-party accrediting bodies. These organizations define both baseline expectations and aspirational goals by establishing standards, processes and protocols based on updated clinical evidence and industry best practices. Such independent accreditation has become more important than ever, as both the number of specialty medications and the number of players in the specialty pharmacy channel continue to grow. With manufacturers competing for market share, working with an accredited specialty pharmacy can be a benefit to drugmakers.

Today, the primary players in specialty pharmacy accreditation are:

✦ The Center for Pharmacy Practice Accreditation (CPPA;; CPPA is a nonprofit organization established through a partnership of the American Pharmacists Association (APhA), the National Association of Boards of Pharmacy (NABP) and the American Society of Health-System Pharmacists (ASHP);

✦ URAC (;

✦ Accreditation Commission for Health Care (ACHC;; and

✦ The Joint Commission (TJC;

“Manufacturers of these high-cost, complex therapies have a vested interest in making sure their specialty drug is working for patients, and the manufacturer knows that the drug has a better chance of working well if they can be assured their specialty pharmacy partner is providing the highest level and greatest consistency of care — including the many patient-support services that are needed,” says Heather Bonome, Pharm.D., director of pharmacy for URAC.

Today’s accreditation standards are written “to provide a baseline of quality of performance and to challenge an organization to stretch to perform to the highest level of industry best practices,” adds Karen Saunders, director of quality management and accreditations for Express Scripts Holding Co.

According to the Drug Channels Institute’s 2018 update on the accreditation of specialty pharmacies, the number of specialty pharmacies with accreditation expanded again from 2017 levels (see chart below). “We identified 729 unique pharmacy locations that by the end of 2017 had achieved accreditation from the three major independent accreditation organizations ACHC, CPPA and URAC,” says Adam Fein, Ph.D., president of Pembroke Consulting, which also operates the Drug Channels Institute. “The 2017 figure is almost double what it was in 2015.” He adds that pharmacy locations owned by health care providers — hospitals, health systems, physician practices and providers’ group purchasing organizations — was the fastest-growing category.

“The accreditation process involves a comprehensive review of all the many processes that support quality patient care and promote patient safety, with an emphasis on ongoing performance measurement and validation,” notes Rob Osborne, vice president, pharma trade relations for Express Scripts. “Achieving one or more accreditation awards is a key benchmark that reflects not only the specialty pharmacy’s capabilities, but its commitment to ongoing improvement of services as well.”

For instance, because many specialty medications are biologics that require complex dosing regimens and self-injection, specialty pharmacies often provide a full slate of educational programs to help patients understand their disease and their medication, understand and avoid potential drug-drug interactions, manage the complex drug-administration requirements prior to initiation of therapy and more. By providing continuous monitoring and periodic outreach to patients (using pharmacists or nurses) and reporting agreed-upon metrics back to the drugmaker, specialty pharmacists provide the critical connective tissue needed to ensure optimal drug utilization over time for each patient.

The program-specific data and analysis the specialty pharmacy can provide help drugmakers track drug utilization and patient outcomes over time and use the detailed insight to make ongoing program enhancements.

Meanwhile, many of today’s specialty medications have potential toxicity issues that trigger complex handling and reporting requirements under the drug’s FDA-mandated Risk Evaluation and Mitigation Strategies (REMS) program. Accreditation helps specialty pharmacies put in place the rigorous, institutionalized operational framework that is needed to manage REMS and comparable regulatory requirements effectively.

“When we perform an on-site visit, we’ll look at individual patient records and profiles to see if the specialty pharmacy is meeting its requirements with regard to REMS,” says Lynnae Mahaney, B.S.Pharm., M.B.A., ASHP director of pharmacy accreditation, providing comments on behalf of CPPA.

Oral Oncolytics Are Challenging

Oral oncology medications fall under the purview of specialty pharmacy because they often have a unique set of dosing and administration requirements to encourage optimal clinical outcomes and a toxicity profile that must be closely managed. Unlike traditional infused oncology medications, which are administered in a clinical care setting and billed through the physician practice’s buy-and-bill program, oral oncology medications are typically dispensed by the specialty pharmacy directly to the patient to self-administer.

When it comes to oral oncolytics, small deviations from ideal dispensing and dosing can have enormous consequences. For instance, “in chronic myeloid leukemia, as little as one week off of the prescribed oral oncology medication can cause the disease to relapse, so patients must take a pill without fail, every day, for the rest of their lives,” explains Ann Steagall, director, clinical policy for Biologics, Inc., McKesson’s independent provider of oncology and complex-care specialty pharmacy services. “That’s a lot to ask of patients — especially when you consider the potential financial implications and/or side effects they may be facing — but there’s so much at stake if they fall off therapy. High-touch support programs that involve regular outreach from a nurse help to not only encourage patient compliance but also provide a mechanism to quickly recognize the emergence of contributing factors such as pill fatigue, financial impediments and other lifestyle or health issues that may arise, so that rapid intervention from a nurse or pharmacist can be provided.”

“Meanwhile, as the cancer-treatment paradigm continues to move from infused therapies toward oral medications, oncology practices often lose money with that prescribing choice (as the oral oncolytics are neither administered on-site nor billed through the practice’s buy-and-bill model). As a result, many oncology practices do not invest a lot in the extra programs or personnel to carry out high-touch patient support — rather, that tends to be relegated to the drugmaker-sponsored specialty pharmacy,” continues Steagall.

“Because we are always in such close contact with the patients taking the oral oncology products we dispense, we are in an ideal position to learn about side effects and other factors impacting adherence — often before the prescribers even do — so we maintain very close communication with the patient’s physician to ensure that they know what we know,” she adds. “In that way, we really consider ourselves to be an integral extension of the oncology care team to help manage the patient’s ongoing health and safety.”

Voluntary May Now Be Compulsory

When the specialty pharmacy accreditation movement really began to gain traction several years ago, first movers were able to tout their hard-won accreditation status as a differentiator to set them apart from others competing for the same lucrative contracts with specialty drug manufacturers. However, as specialty drug makers, payers and PBMs are increasingly urging — if not outright requiring — third-party accreditation from one or more of the leading accreditation bodies, this once-voluntary undertaking now feels more like a de facto requirement than ever for specialty pharmacy.

“Of course, many specialty pharmacies should recognize that gaining accreditation benefits their practice and their patients, but we also see that many pharmacies come to us because a given drugmaker or payer has made accreditation a requirement to do business within their limited-distribution network,” says Bonome.

Payers, in particular, have a lot of skin in the game whenever it comes to reimbursing for high-cost specialty medications, which can easily cost $100,000 per year or more. “When these therapies are administered and used properly, they can provide critical relief of symptoms, or even a cure, for patients, and that justifies the cost,” she says. “Payers are also aware the improper use of these medications can lead to a worsening of the condition, which could lead to hospitalization and other high-cost interventions.”

“Importantly, the accreditation award reduces the burden of oversight by payers themselves, because it establishes specific, rigorous performance standards and then provides a consistent level of assurance (by the third-party accreditation organization) that the quality of services provided by the specialty pharmacy meets them,” says Osborne, who adds that increasingly, accreditation is also required to meet regulatory requirements for government payers such as Medicare and Medicaid.

Accreditation Provides Advantage

Meanwhile, in this era of value-based care, payers also are working with specialty pharmacies to create payment models that reward those specialty pharmacies that are able to demonstrate consistent patient outcomes and other performance metrics. While simply having accreditation no longer provides the degree of competitive differentiation it once did, the ability to deliver world-class programs and to develop the metrics needed to prove their worth can continue to give accredited specialty pharmacies a competitive advantage.

“Fortunately, any additional expenses and effort associated to gain and maintain accreditation can be justified by the potential to win or lose contracted work based on being able to demonstrate the accreditation status,” says Quintin Jessee, R.Ph., D.Ph., an executive at D2 Consulting. “Today, if your organization is not accredited with any of the major players, you could instantly lose out on future business-growth opportunities.”

“Of course, if you don’t have your house in order, you won’t be able to deliver the highest-quality care for patients with these complex illnesses, and you won’t be able to compete against those specialty pharmacies that do,” adds Mahaney, who also served as the executive director of CPPA until late 2016. “Accreditation will ensure both.”

✦ Accreditation criteria involves standardized protocols, processes, data-gathering, documentation and reporting requirements for patient care related to the following:

✦ Securing insurance approval for the patient;

✦ Improving time to first fill of the prescription;

✦ Investigating options that may be available to reduce the cost of the medication;

✦ Managing patient data from initial assessments through ongoing follow-up assessments;

✦ Coordinating patient care and documenting the care plan;

✦ Reconciling medications to avoid potential drug-drug interactions;

✦ Reporting clinical outcomes, side effects and adverse events;

✦ Validating cold-chain processes;

✦ Ensuring proper handling of hazardous waste;

✦ Carrying out staff credentialing and training, with proper documentation;

✦ Monitoring the performance of incoming and outgoing telephone-based interactions with patients (looking at, for instance, speed to answer calls, longest wait times, how many calls are abandoned and so on); and

✦ Providing seamless access to nurses, disease specialists and behavioral coaches who can increase patient understanding and support the optimal use of the medication.

Jessee notes that emerging specialty pharmacies can benefit from the accreditation process by using these rigorous standards to both level the playing field with existing players in the space and build a solid infrastructure, with rigorous, durable processes, right from the outset, which will establish a pathway for successful growth over time.

Toward that end, specialty pharmacies should try to look at the data gathering and reporting requirements not as a burden but as a tool for continuous improvement, adds Bonome. “If you are required to track and report multiple metrics, you should use this tracking to identify any negative trends that arise and respond quickly with a corrective-action plan,” she says.

It is important for specialty pharmacies “to have a commitment to ongoing innovation and improvement,” adds Mahaney. “If you’re going to just check the box, you’re missing the greater point here.”

“As our CPPA surveyors are working with specialty pharmacies to gain or maintain accreditation, they will not only make specific recommendations in writing [on] how the pharmacy can become compliant, but they will also document the specialty pharmacy’s own best practices or points of excellence,” she explains. “CPPA-accredited specialty pharmacies can then publicize these findings to differentiate themselves from their competitors, as they work to gain access to the specialty drug manufacturer distribution channels.”

In that same vein, when a specialty pharmacy is able to develop a strong, data-driven story to demonstrate strong patient outcomes related to the optimal use of the therapy, it can also leverage that accomplishment to demonstrate the high quality of its service offering, says Bonome.

According to Jessee, “Several pharmacies have carried out case studies that demonstrate that their management of therapies and patient outcomes are saving the overall health care system money, through proper formulary management for PBMs, prevention of side effects, reduction of hospital readmissions and more.”

Companies Can Customize Offerings

The various accreditation organizations are quick to point out that while they establish rigorous performance standards based on clinical evidence and industry best practices, the opportunity for a certain amount of flexibility and customization is always baked into the different frameworks. Consider, for example, the inherent variability among complex illnesses — from hepatitis C and HIV to hemophilia and cancer — and the landscape of specialty therapy options that are available to treat them. To develop and administer the most meaningful wraparound programs, accredited specialty pharmacies want some degree of latitude to work closely with the drug manufacturer to decide which types of data and metrics are most relevant.

“URAC’s accreditation programs allow for innovation and encourage customization by empowering organizations to develop drug- or disease-specific workflows that align with their business model and patient needs while still meeting the accreditation standards,” notes Bonome of URAC.

Despite the benefits, and the overwhelming peer and professional pressure to seek accreditation, some pharmacies do still choose to forgo accreditation. “I see this all the time,” says Jessee. “The fees are often the biggest obstacle for smaller pharmacies, and the financial and administrative burden can be hard to justify if the return on investment is not obvious.”

The added costs are both internal ones — to adequately provide the required high-touch patient services and manage added data-gathering and reporting capabilities — and external — to keep up with the needs for initial and renewal inspections and audits — notes Express Scripts’ Saunders. “For some specialty pharmacies, the cost of a particular required accreditation may simply outweigh the potential benefits of participating in a given network, based on the payer’s reimbursement schedule,” she says.

Is Consolidation Inevitable?

The proliferation of competing accreditation bodies in recent years begs two important questions: Is there enough differentiation among them to justify so many players in the space? And why must today’s specialty pharmacies endure the added cost, parallel effort and potentially redundant burden required to achieve accreditation with multiple organizations and manage so many sets of rigorous process and protocols to maintain ongoing accreditation?

While there are certainly overlaps in the philosophy and requirements of each of the competing specialty pharmacy accreditation bodies, many stakeholders agree that there’s still room at the table for all of them. “Some of these groups focus on specific portions of the overall specialty pharmacy offering, by offering specific accreditation requirements for home infusion, sterile and non-sterile compounding, wholesaling, and durable medical equipment, prosthetics, orthotics and supplies (DMEPOS),” explains Jessee.

“ACHC and URAC don’t offer any accreditation for wholesaling operations, but NABP offers such an accreditation (called verified-accredited wholesale distributors, or VAWD),” he says. “In order to get a state wholesale license in Indiana, Wyoming and North Dakota, you have to have a VAWD accreditation.” In addition, “ACHC has something similar with compounding, and it is required by states, so you must gain that accreditation if you do any compounding operations, in order to obtain a state pharmacy license.” On the other hand, Michigan recently mandated Joint Commission accreditation for compounding pharmacies in that state.

“There are differences in survey requirements, survey processes, customer focus and support, costs, reputation and industry standing, along with the rigor of their individual accreditation processes that would impact the choice between accrediting organizations and ultimately define the competitive landscape,” adds Saunders.

Firms Must Be Ready for Audits

“Many PBMs carry out periodic audits of specialty pharmacies to ensure compliance with contractual requirements. Fortunately, most of the common audit topics are already effectively addressed within the rigorous standards imposed by the third-party accreditation organizations,” says Jessee. He notes that if specialty pharmacies are not staying compliant with their accreditation standards, they likely will not do well with these audits.

“Accredited pharmacies must maintain an active quality management program to oversee maintenance of quality standards, metrics and reporting. Maintaining this kind of quality program can help an organization to always be ‘accreditation ready’ or ‘audit ready,’” adds Bonome.

As for the reporting requirements set forth in the various accreditation standards, they are generally two-fold: (1) reporting that must go to any to external stakeholders, such as the specialty drug manufacturer, various payers and PBMs; and (2) reporting that must go back to the accreditation agency, to both demonstrate ongoing compliance and to help the accreditation body develop performance-related metrics of its own.

For example, the various accreditation bodies require specialty pharmacies to track and report, on an annual basis, a variety of specific metrics related to the following areas:

✦ Adherence rates;

✦ Percentage of days covered;

✦ Pharmacist interventions;

✦ Patient and health care provider satisfaction;

✦ Drug-drug interactions;

✦ Call center performance;

✦ Dispensing accuracy;

✦ Distribution accuracy;

✦ Prescription turnaround time;

✦ Quality-related events and medication errors;

✦ Active patient volume being maintained according to patient-case-management protocols, by disease state;

✦ Proportion of days covered; and

✦ Primary medication non-adherence.

“URAC’s goal is to use these key performance indicators to support ongoing quality improvement, efficiency and effectiveness in specialty pharmacy,” says Bonome.

From the drugmaker’s standpoint, one of the most important metrics relates to patient adherence to drug therapy, as this is the ultimate bellwether of how all of the various specialty pharmacy program elements are working. “The pharmacy is in a unique position to track key indicators, such as side effects, adverse events and adherence. Consistent periodic monitoring can identify patients who are struggling with adherence to medication and provide timely, targeted interventions that will help to keep the patient on the regimen as long as it is clinically appropriate,” says Bonome. “Evaluating how pharmacies are tracking and documenting individual patient adherence is something that we review regularly, by pulling individual patient files, whenever we conduct an accreditation review,” she adds.

This article was contributed by Suzanne Shelley of Pharmaceutical Commerce. For more information, visit  


FDA Approves First RNAi Drug, While Alnylam Unveils Deals

On Aug. 10, the FDA approved Alnylam Pharmaceuticals, Inc.’s Onpattro (patisiran) for the treatment of adults with polyneuropathy caused by hereditary transthyretin-mediated (hATTR) amyloidosis. The first-of-its-kind therapy is launching onto the U.S. marketplace with a costly price tag — and value-based deals with a handful of health insurers that should help with patient access while assuring them that they are paying for value.

According to the company, hATTR amyloidosis “represents a major unmet medical need with significant morbidity and mortality.” Proteins build up and damage patients’ nerves, causing them to lose feeling in their extremities, before moving on to attack their organs. Median survival after diagnosis is 4.7 years.

It is the first drug the agency has approved for this condition, as well as the first in a new class of drugs called small interfering ribonucleic acid (siRNA) treatment. RNA interference (RNAi) was discovered in 1998, and it’s taken 20 years for a company to be able to successfully bring a drug to market based on that process. The approval, wrote Evercore ISI analyst Steve Breazzano in an Aug. 10 research note, is “a tremendous achievement and milestone for the field.”

Firm Has More RNAi Drugs in Pipeline

Alnylam’s process focuses on silencing messenger RNA (mRNA), which is a type of RNA molecule that encodes for disease-causing proteins, thus preventing them from being made. The company has multiple other RNAi therapeutics in its pipeline, with three in late-stage development.

According to a draft evidence report from the Institute for Clinical and Economic Review (ICER) released July 20 that assesses Onpattro and inotersen, a drug from Akcea Therapeutics that the FDA is assessing with a Prescription Drug User Fee Act date of Oct. 6, “Patisiran is the first drug for hATTR with evidence of improved disease progression, polyneuropathy, and neuropathy-related quality of life. We found evidence of improvement in the cardiac marker NT-proBNP, which may or may not translate into decreased risk of death, and by post-hoc cardiac hospitalization and mortality analysis, which suggests reduced rates of cardiac events, though the trial population may underrepresent hATTR cardiomyopathy-dominant patients. In summary, we have moderate certainty of a substantial net health benefit with high certainty of at least a small net health benefit compared to best supportive care, and rate the clinical evidence for patisiran to be incremental or better (‘B+’).”

Average Annual List Price Is $450,000

Onpattro encases the siRNA into a lipid nanoparticle that is delivered directly into the liver. Dosing for Onpattro, an intravenous infusion administered over about 80 minutes, is weight-based. With a cost per vial of $9,500, the average annual list price is $450,000, based on an average of 2.7 vials administered an average of 17.5 times per year. But after taking into account mandatory government discounts, Alnylam estimates that the average annual net price will be $345,000. The ICER report notes that additional costs for Onpattro infused in-clinic include the following, which assume an annual price of $300,000:

✦ “6% mark-up to the drug’s annual acquisition cost ($300,000 x 6% = $18,000);

✦ “$228.11 administration cost per infusion (up to 1 hour + additional infusion time: CPT code 96365 + 96366 = $191.08 + $37.03); and

✦ “$2.90 for pre-infusion drugs at generic WAC prices per infusion (10 mg dexamethasone at $2.70, 500 mg oral acetaminophen at $0.05, 50 mg diphenhydramine at $0.10, and 50 mg ranitidine at $0.05).”

During an Aug. 10 conference call, Barry Greene, Alnylam president, explained that the company priced the drug with an eye on “patient access and delivering good value” to payers and providers. He said that five other factors influenced the price:

(1) There is an “urgent unmet need in this disease setting,” as the FDA has not approved other therapies for this indication.

(2) The drug produces outcomes, based on its ability to halt or reverse neuropathy impairments, “with an encouraging safety profile.”

(3) The disease is rare, as fewer than 3,000 people in the U.S. have been diagnosed with the condition.

(4) It’s a new class of medicines, the culmination of 16 years of research and development, and has the “potential to transform the treatment of diseases.” It will give the company a “reasonable return” on its development.

(5) “We’re deeply committed to the hATTR amyloidosis community and developing entirely new classes of drugs…to transform the lives of even more” people suffering from additional diseases.

Greene said the drug will be available through two specialty pharmacies and one specialty distributor for infusion in offices, infusion clinics and patient homes. On Aug. 13, Orsini Healthcare Specialty Pharmacy and US Bioservices, a specialty pharmacy that’s part of AmerisourceBergen Corp., said that Alnylam had selected them to distribute Onpattro.

Infusions Can Be Administered at Home

Greene said that initially, the company expects the “vast majority” of patients will be covered by commercial plans under the medical benefit or Medicare Part B. Onpattro infusions will still need to be done by health care professionals for those patients infusing the medication at home.

As part of its commercialization efforts, the manufacturer will focus on diagnosis of the condition, education about the condition and Onpattro itself, and patient support.

In addition, says Greene, the company has been “negotiating value-based agreements with several insurers to ensure that payment for the drug is based on the ability of Onpattro to potentially halt or in some patients reverse neuropathy impairment.” He noted that such proactive discussions are “a unique thing for our industry.” Alnylam has “agreed in principle” with Harvard Pilgrim Health Care, Inc. “and other major insurance carriers” on the structure of such arrangements. “Productive discussions” with other companies are ongoing, he said.

The deals, said Greene, will help ensure that after people are diagnosed with the condition and given a prescription for Onpattro, they will have “swift access” to the therapy. Payers, Greene said, can qualify for “significant rebates if treatment outcomes are suboptimal.”

Between nine and 12 months after starting treatment, patients will be assessed in terms of “how they are doing clinically” in the real world as opposed to measures from clinical trials. He declined to offer specifics.

For patients who respond to the therapy, Alnylam should be reimbursed for the total cost of Onpattro, said Greene. But for patients who are hospitalized or suffering other medical complications, “there should be some discount on what we’re being paid.” Discounts will not go below Medicaid best price, he added. Alnylam can help perform the assessment, as can a third-party adjudicator or the insurer itself. “It really depends on how the insurer wants to handle it,” explained Greene.

According to Michael Sherman, M.D., chief medical officer at Harvard Pilgrim, the proactive approach that Alnylam took in striking these deals underscores the manufacturer’s commitment to patients, to their ability to access the drug and to “delivering meaningful outcomes” to the U.S. health care system. “By virtue of linking level of reimbursement to meaningful patient outcomes, this agreement will help us meet the needs of hATTR amyloidosis patients by supporting our efforts to balance access and affordability.”

“We applaud Alnylam for taking a responsible approach to pricing and patient access in the rare disease space, an increasingly complicated challenge,” said Steve Miller, M.D., chief medical officer at Express Scripts Holding Co., adding that the companies want to work together toward “a common goal of ensuring broad, affordable access to important medicines for rare conditions.”

Aetna Inc. would appear to be another company inking a value-based deal for Onpattro, as Jim Clement, executive director of value based care and supply chain management at Aetna Pharmacy Management, said he was “looking forward to being a part of this Alnylam initiative.” According to Clement, “Alnylam’s approach is to start with a clinical package that provides real benefit to patients and then ensure value is delivered in the real world over time. It’s about reducing uncertainty and knowing that you’re paying for the outcomes you expect.”

According to ICER, “The model produced results suggesting gains in costs and health outcomes from the new treatments for hATTR amyloidosis. We also found that the choice of the modified societal perspective, with its inclusion of productivity costs and losses, increased the total incremental costs for new treatments, and therefore increased cost-effectiveness ratios slightly. In all four of the base cases, the incremental cost-effectiveness ratios were beyond levels normally considered good value for money. Given the high additional treatment cost, new treatments will need to be accompanied by extremely large corresponding QALY [i.e., quality-adjusted life year] benefits in order to obtain incremental cost-effectiveness ratios below standard thresholds.”

ICER will release a revised evidence report on or about Aug. 29 that will include value-based price benchmarks.

Contact Alnylam through Christine Regan Lindenboom at (617) 682-4340. View the ICER report at

by Angela Maas

This story was reprinted from AIS Health’s monthly publication Radar on Specialty Pharmacy. For more information, visit  


Opinions Vary on MA Plans’ Use of Step Therapy in Part B

While many stakeholders have praised CMS’s move to allow Medicare Advantage (MA) plans to apply step therapy to drugs covered under Part B, others have cautioned that it could result in delays or restrictions in patients accessing much-needed medications.

In a September 2012 memo, CMS reminded “Medicare Advantage Organizations (MAOs), Section 1876 Cost Contractors, Section 1833 Health Care Prepayment Plans, and PACE Organizations that the imposition of additional requirements for access to certain Part B drugs or services, such as step therapy requirements, is not permitted unless also required through Original Medicare.”

CMS regulations require these organizations to have, “at minimum, equal access to items and services covered by Original Medicare in their service area. While plans may create coverage policies in the absence of an NCD [i.e., national coverage decision] or LCD [local coverage decision], those policies may not be more restrictive than what Original Medicare allows and may not impose barriers to Parts A and B services, including, as described above, the imposition of step therapy requirements for Part B drugs and services,” according to the memo.

CMS Rescinded 2012 Memo

However, on Aug. 7, CMS reversed its policy on step therapy in a letter sent by HHS Administrator Seema Verma to MAOs. Rescinding the 2012 memo, CMS issued new guidance allowing MA plans to use step therapy for Part B drugs as of Jan. 1, 2019. According to the letter, “CMS is acknowledging that the use of step therapy is a recognized utilization management tool. The allowance of step therapy practices for Part B drugs will help achieve the goal of lower drug prices while maintaining access to covered services and drugs for beneficiaries.”

The letter also states that those MA plans that also offer prescription drug coverage may use step therapy to have a beneficiary use a drug under Part D before stepping to one under Part B. The policy change will apply to new prescriptions only, and it will be in conjunction with a patient-centered care-coordination program.

There are more than 20 million beneficiaries in MA plans, or about 33% of Medicare enrollees. Part B drugs represent almost $12 billion per year in spending by these plans. CMS estimates that allowing step therapy could produce savings between 15% and 20%. Not only would the program save money by allowing plans to negotiate with manufacturers on their drugs’ placement in terms of first-line, second-line and later, but MA as well as taxpayers would “get better value for Part B therapies.” In addition, when such negotiations result in a lower average sales price for drugs, traditional Medicare beneficiaries’ copayments would likely decline because those payments are based on ASP.

Many Stakeholders Support New Policy

Many stakeholders praised the administration for opening up the use of a tactic long relied on by commercial plans.

“Today’s announcement by the Administration to include greater use of PBM tools in Medicare Part B through Medicare Advantage Prescription Drug Plans is an important step toward reducing costs for the program and beneficiaries,” said the Pharmaceutical Care Management Association. “Some of the highest priced drugs are found in Medicare Part B, where PBMs currently don’t play any meaningful role. We look forward to working with the Administration and Congress to continue the Medicare Part D success story, and exploring additional ways to introduce more competition into Medicare Part B.”

“Patients and families deserve the prescription drugs they need at a price they can afford,” stated Matt Eyles, president and CEO of America’s Health Insurance Plans. “The new CMS policy helps deliver on that promise while also helping to ensure patients continue to have access to safe, effective, and evidence-based care.

“We commend CMS for their leadership to strengthen the private sector’s ability to implement market-based solutions that can lower the cost of high-priced drugs for consumers,” he continued. “This approach empowers Medicare Advantage plans to negotiate lower drug prices — so that health insurance providers can reduce costs for patients and hardworking taxpayers. We look forward to working with CMS and the Administration on these changes, and are strongly committed to protecting patients and bringing down the price of medications for every American.”

Groups Caution on Treatment Barriers

In a letter to HHS Secretary Alex Azar on the administration’s blueprint, which included negotiating Part B drug prices, the American Medical Association said, “The AMA is concerned about the utilization management tools frequently used by PBMs and health plans to control costs, as they often have little clinical basis and can simply be a means of shifting costs in the system. For example, prior authorization and step therapy protocols can create significant barriers for patients by delaying the start or continuation of necessary medical treatment, which can negatively affect patient health outcomes. While a particular drug or therapy might generally be considered appropriate for a condition, the presence of comorbidities or patient intolerances may necessitate an alternative treatment.”

The American Cancer Society Cancer Action Network’s (ACS CAN) president, Chris Hansen, called for some guardrails to help ensure treatment isn’t delayed: “ACS CAN shares the administration’s goal of lowering prescription drug costs for patients. However, the details of the policy change to allow for step therapy will be important to understand the impact on cancer patient access to lifesaving therapies.…It is imperative that any step-therapy process be accompanied by a speedy and easily understood appeals process to ensure patients don’t face delays to recommended treatment that could compromise the efficacy of those therapies in treating their cancer. We are pleased CMS intends to allow beneficiaries access to an appeals and exceptions process and urge them to closely monitor the extent to which beneficiaries are seeking exemptions and appeals.

“Going through cancer treatment is hard enough — cancer patients should not be forced to ‘fail first’ on a drug that is known not to work for them before they are allowed to take the recommended treatment.”

In an Aug. 8 research note, Leerink analysts noted that pharma companies stand to be impacted as well: “Pharmaceutical companies could be enticed to offer rebates back to payers and plans in order to gain preferred status at the front of a step-edit or risk losing volume as a second-line or later agent. In turn, these rebates will lower drug costs for Part B MA plans and patients, but also lower pharmaceutical revenues.”

They cite Regeneron Pharmaceuticals, Inc., which manufactures the ophthalmologic treatment Eylea (aflibercept), and Amgen Inc. as being two of the companies most at risk. For Regeneron, the policy change “will re-ignite speculation about the threat of biosimilars, lower priced branded entrants and substitution with compounded Avastin (bevacizumab),” from Genentech USA, Inc. For Amgen, they wrote, “patient and physician preference for their growth factor products facing biosimilar competition is likely to be challenged.”

Ultimately, wrote the analysts, “Prior attempts to shift Part B to Part D or to change the reimbursement rates have been met with choruses of complaint and finally suspended or reversed. The current climate for such changes is different, and it seems more likely, but still not certain, that this plan is implemented as written.”

The policy change potentially could impact the care patients receive and the cost of medications, particularly in therapeutic classes that have biosimilars or other similar options, says Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates. “Step-therapy programs are common in commercial health plans because plans believe that they and prior-authorization programs result in cost savings,” he tells AIS Health. But it could also set up barriers to the use of off-label therapies, “and that delayed access could have clinical consequences.”

Still, he says, the ability to manage across both the pharmacy and medical benefits could be overall beneficial. For example, consider a drug that costs $2,000 but saves $12,000 in hospital costs. When only the pharmacy benefit is taken into account, the drug represents a $2,000 cost. But when the benefits are coordinated, this situation would be viewed as a $10,000 savings.

Things to watch for, according to Rubinstein, include “Will drug access be unduly restricted, delayed or made more difficult in the case of well-documented rationale for off-label use? If the new management approaches are perceived as onerous and a barrier, will (and how will) prescriber therapy (e.g., injectable vs. oral therapy alternatives) and referral decisions (e.g., in-office drug administration vs. referral to hospital outpatient for drug administration) be impacted? Another problem, if the MAPD [i.e., Medicare Advantage Prescription Drug plan] contracts for provision of the pharmacy benefit rather than providing for it internally, is how the MAPD will coordinate with its pharmacy contractor.”

Contact Rubinstein at

by Angela Maas

This story was reprinted from AIS Health’s monthly publication Radar on Specialty Pharmacy. For more information, visit  


Reality Check: Multiple Myeloma

Our Point of View

Drugs for this class receive excellent coverage by payers, many of which have specific policies for these products. Coverage is under both the pharmacy and medical benefits. “The mainstays of treatment for multiple myeloma are considered specialty medications and therefore placed into a specialty tier,” says Raechele McMahan, vice president and general manager, enterprise specialty pharmacy at Prime Therapeutics LLC. “The therapies are also subject to utilization management, which primarily consists of prior approval.” She tells AIS Health that “since multiple myeloma is considered an incurable but treatable disease, there are many things to consider when choosing a therapy.”


Pharmacy Benefit

A review of market access for multiple myeloma treatments reveals that payer pharmacy benefit coverage varies by channel. More than half of the covered lives under commercial and Medicare formularies are restricted. About 22% of commercial lives and 34% of health exchange lives don’t have access to such drugs.

Medical Benefit

Payer medical benefit coverage for multiple myeloma treatments paints a much different picture of this landscape. Under Medicare formularies, about 40% of the lives are covered, and only 10% are restricted.


AIS Health’s View

The FDA has approved numerous drugs for use in multiple myeloma. “Combination therapy is the standard of care for treating multiple myeloma,” says McMahan. Mary Dorholt, Pharm.D., senior director and clinical practice lead, specialty at Express Scripts Holding Co., notes that this is the case “throughout all stage of multiple myeloma. Sometimes triple therapy is required for high-risk features to improve survival. Different classes of therapies used include proteasome inhibitors, immunomodulatory medications, steroids, HDAC [i.e., histone deacetylase] inhibitors, monoclonal antibodies and chemotherapy.” Because of the triple combination therapy, “the average annual cost of treatment for multiple myeloma can range from $100,000 to more than $250,000,” says McMahan. “Much of the cost is associated with drug therapy. Some patients require further treatment such as a stem-cell transplant, which could carry a significant cost.”


Trends From AIS Health

Various Effective Multiple Myeloma Therapy Options Exist

Although multiple myeloma is a relatively rare cancer, numerous therapies to treat it are available. Because of these products’ efficacy, they have made the disease manageable — and, as a result, costly.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online

Using ICER as Sole Part B Coverage Determination Could Change Drug Access

If Medicare Part B coverage policy were based on value assessments from the Institute for Clinical and Economic Review (ICER), people being treated for four diseases could lose access to current treatments, according to an issue brief by Xcenda, an AmerisourceBergen company.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online

Walgreens Provides Pharmacists Cancer Training, Designates Specialty Pharmacies

In an effort to improve the care it provides to people with cancer, Walgreen Boots Alliance, Inc. provided oncology-focused training to pharmacists and pharmacy technicians at some of its specialty pharmacies. This enabled the company to recently designate more than 50 of its specialty pharmacies as cancer-specialized locations.

Subscribers to AIS’s RADAR on Specialty Pharmacy may read the in-depth article online


Key Findings

A Drug Class With Good Coverage

All drugs in this class have good coverage through insurance plans. Most payers have written specific policies for the use of each of these agents in multiple myeloma and other disease states. New drugs and combinations of approved drugs are being researched to provide more options for patients with myeloma. Most payers will include these FDA-approved and off-label combination therapies in their payment policies.

Competitive Market Landscape

Many different drugs to treat multiple myeloma are available. The choice and dose of drug therapy depend on many factors, including the stage of the cancer, the age of the patient, kidney function of the patient and if a stem cell transplant is planned. A variety of novel drugs are being studied for the treatment of relapsed myeloma and relapsed, refractory myeloma. For instance, HDAC inhibitors are an area of active research, both as single drugs and in combination with other drug therapies.


AIS Health’s View

Multiple myeloma has some common comorbidities that may complicate a person’s treatment. “Patients are typically at high risk for exhibiting C.R.A.B. symptoms: C = hypercalcemia; R = renal failure; A = anemia; B = bone lesions,” McMahan says. “Each of these symptoms, if present, can cause either treatment modifications and/or additional therapies to be included to ease patient symptoms.” Supportive care also may be required for other situations, she tells AIS Health. “Though this is an incurable disease, it can be manageable with treatment,” explains McMahan. “Recent therapies have increased the overall survival of patients, making multiple myeloma more of a chronic disease. Unfortunately, these advances and increases in longevity have come with much higher costs of care for our health plan clients and their members.”