Clinical Value and Price-setting for New Cancer Drugs

By Lars Lööf, New Therapies (NT) Council, Swedish Association of Local Authorities and Regions, Tomas Salmonson, Swedish Medical Products Agency and EMA Committee for Medicinal Products for Human Use, Hans Hägglund, Uppsala University Hospital, Henrik Lindman, Uppsala University Hospital and Uppsala University, Department of Immunology, Genetics and Pathology, Experimental and Clinical Oncology; Clinical oncology.

Photo Credit: Artisteer

In the last twenty years, as a consequence of very considerable research activity, science has made rapid progress in the field of cancer research. This has resulted in many new approved treatment options along with countless other products which are currently in development.

Some of these new products can provide significant clinical improvements to the available alternative, others perhaps offer only limited additional value. However, the true additional clinical benefits of a new drug can be difficult to judge from early clinical trials and may not be established until after years on the market. This process will require long-term follow-up including patient-reported outcomes.

The cost of new treatments is often substantial and the bodies responsible for payment and reimbursement have to make difficult choices that restrict patients’ access to these new drugs. This raises important questions for all stakeholders.

The main focus areas of the workshop:

Our goal is a more balanced understanding of the true clinical value and fair price-setting of new cancer drugs. We hope to initiate discussions about:

  • the appreciation of a lifecycle perspective to achieve a more comprehensive, dynamic, balanced, sustainable, and knowledge-based foundation for the continuous evaluation of the true clinical value (benefits-risks) and as a base for prioritization, health-economy evaluations, and price-setting at a certain time-point post marketing.

  • the potential implications of a lifecycle perspective for the formal decisions and communication (“information package”) of marketing approvals by the authorities as well as the potential implications for other stakeholders.

  • sustainable models for price-setting which reward continuous monitoring and gathering of knowledge.

Cancer - a major threat to population health worldwide

Globally, cancer is the second leading cause of death, being responsible for nearly one in every six deaths[1] [2]. Late-stage presentation and inaccessible diagnosis and treatment are common. In 2015, only one in three low-income countries reported having diagnostic and treatment services generally available in the public sector [3]. The economic impact of cancer is significant and is increasing. Its total annual economic cost worldwide in 2010 was estimated at US$ 2.5 trillion including costs for diagnosis and treatment and productivity lost due to the consequences of the disease[4].

The trend towards more tumour-specific drugs

Progress in molecular medicine has led to greater understanding of how cancer evolves, how cancer cells are characterized by, for example, defects in DNA repair mechanisms or with respect to cellular signal transduction pathways (hormonal, growth factors, immunological). Accumulating understanding of cancer pathophysiology has also led to new approaches to the design of new cancer drugs and the development of such drugs is moving faster than ever. A large proportion of drug development today is allocated to cancer drugs. Among US biotech companies, half focus on cancer and in 2015 more than 800 new cancer agents were said to be in development[5]. The trend is that new cancer drugs are often designed for very tumour-specific characteristics (e.g. immunological, genetic, etc.) leading to limited indications aimed at smaller patient subpopulations within a certain cancer form. In some cancer forms, where standard treatment is ineffective, the great demands for new options give some of these drugs higher priority (“fast track”) by the authorities in the regulatory process.

How can new improved therapeutic options become available to all those who would benefit?

The development of newer and potentially more effective cancer drugs has for some cancer forms improved the therapeutic options. However, these drugs are not even available in high-income countries for all who might benefit from them because of high prices and limited healthcare resources. These circumstances put increasing demands on healthcare systems to prioritize between the available treatments and indications in order to get maximum benefit for their limited resources.

The regulation of health products, e.g. cancer drugs, is a critical component of every country’s public health system and ensures that high-quality, safe, and effective products reach those who need them most as fast as possible. However, regulatory systems can differ between regions of the same country, both in terms of the models applied and their capacity to assess and monitor drugs. The models to allocate priority to certain cancer drugs/treatments but not others also differ between healthcare systems all over the world and are more or less developed globally [6]. Thus, enabling platforms for collaboration and harmonization of these processes and transferring knowledge between regulatory authorities in different countries would be one of several actions which could challenge these differences.

Adopting a lifecycle perspective towards new cancer drugs

Drug development is a difficult and time-consuming process often taking up to 10 to 15 years and combining both great potential with significant risk. The investment required for individual drug development is high and only a fraction of the compounds in preclinical testing ever make it to clinical trials and approval for patient use. When marketing approval for a drug is given by the authorities, the decision, based on the product documentation, is made from a balanced consideration of the benefits and risks. However, the true magnitude of the effect of a new drug is often uncertain at the time of marketing approval. One reason is that the clinical documentation in the application for marketing approval is sometimes based on studies with rather small numbers of patients, and often with a short-time follow-up (so-called phase-2 studies).

Although there are outcomes in the registration files that give the authorities useful predictions of potential benefits of a new drug, many data are still associated with a high degree of uncertainty. Another reason is that the preconditions for using a drug in routine clinical practice differ to those in a clinical trial. Many perspectives (e.g. patient selection, age, stage of the disease, concomitant diseases, etc.) may change when a new drug takes the step from clinical trial into clinical routine. These factors have quite an important influence on the outcome of both effects and side-effects of a drug. Thus, the clinical value of a new drug is uncertain and not fully determined at the time of approval, not at least with respect to long-term data on effect, side-effects and especially as a basis for health-economic considerations. 

The knowledge of the clinical value of a drug evolves continuously during its lifecycle (Fig 1). Thus, there is still much to do in order to develop a process of continuous collection of knowledge for the understanding of the true, short- and long-term clinical value of new cancer drugs. This is important from many perspectives, e.g. from the patient’s view (e.g. improved measurements and collections of life quality data) as well as from the view of society (e.g. firmer ground for health-economic evaluation compared to already existing treatments and for price-setting and negotiations).

Thus, when the level of knowledge of a drug at a certain time during its lifecycle is known, then the willingness to pay (the buyer’s perspective) for the product can be based on much firmer grounds.

Figure 1. Life cycle of a new pharmaceutical drug

Lifecycle of a pharma drug

Fair price-setting for all stakeholders

New possibilities to cure, or at least delay, cancer have been presented frequently during the last decade and often take the form of new pharmaceutical drugs or a new combination of drugs. The pharmaceutical industry claims that the high price-setting of many new drugs is motivated by high development costs. However, if new medicines and health products are to be used to optimal effect, they must be available at affordable prices. The price paid for new products (as well as existing ones) must be fair to all – affordable in different countries yet sufficient to ensure a sustainable industry to produce them. Establishing fair and transparent pricing models valid during the lifecycle of a drug is thus an urgent priority. New drugs, including cancer drugs, get their marketing approval at a time point where the effect and safety documentation is limited and partly uncertain, especially with respect to long-term results.  It is therefore important to find fair pricing models, taking a lifecycle perspective into account, to share the financial risks between stakeholders (buyers and payers).

Determining the true clinical value. Can new options be created that enable continuous collection of evidence after marketing approval?

This workshop will involve the participants in suggesting feasible strategies for allocating priority to certain drugs/treatments and establishing models for monitoring healthcare outcomes of new cancer drugs. This will be done in the context of an imaginary country (e.g. an OECD-country) with established authorities.

According to which principles should stakeholders (buyers and payers) in healthcare make new, promising cancer drugs available and affordable for those patients where the effect is optimal?

What options are there to include a lifecycle perspective for all stakeholders to accumulate knowledge of a drug post marketing and not only focus on marketing approval per se, and what will it take?

What are the prerequisites for sustainable models for price-setting and financial risk-sharing between stakeholders (buyers and payers)? The more we know about a drug’s benefits and risks (clinical value), the more precisely we can find acceptable models for price-setting and willingness to pay at certain time-points of knowledge post marketing approval. Is it possible to allocate priority to certain cancer drugs/treatments but not to other cancer drugs?

How should new cancer drugs be monitored with respect to real-life data after their introduction into healthcare routines?  It is complicated for practical reasons and often impossible from an ethical perspective to perform traditional randomized controlled trials (RCTs) of a certain drug post marketing approval. But then, what are the alternative strategies for obtaining data for the true clinical value based on scientific methodology? Can data from, for example, a quality register or computerized medical records help us to assess the true clinical value of new drugs? Is the essence of what a market access decision covers well understood by patients and healthcare? Or is there a risk of misinterpretation or misunderstanding? Is inclusion and consideration respectively, of data from patients’ experienced value of the therapy and the life quality it provided, compulsory in the background documentation for the determination of the clinical value of specific new cancer drugs? How should we consider the perspectives of children and older people respectively in order to achieve information on, for example, the influence of age-specific factors of life quality, tolerance and safety of a specific new cancer drug?

When a new, potentially effective cancer drug appears in clinical routines, some years from now, how shall we manage a controlled introduction for access, use and follow-up in order to assess the true clinical value of the drug? How acceptable are such measures to different stakeholders such as regulators and ministries of health, medical practitioners, consumers, and pharmaceutical industries? 

There is obviously a demand for international and stakeholder interactive activities to meet the challenges of all aspects of cancer disease therapies in the future. Do we have the platforms, national and international, for these types of interactive discussions between different stakeholders?


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[1] Ferlay J, Soerjomataram I, Ervik M, Dikshit R, Eser S, Mathers C et al

[2] IARC

[3] World Health Organisation, Cancer, Fact sheet, 2017

[4] IARC

[5] Jönsson, B., Persson, U., Wilking, N

[6] World Health Organisation, Towards Access 2030