FDA Chief Highlights Cost as Obstacle to Cancer Treatment

Kerry Dooley Young

April 12, 2018

OXON HILL, Maryland — The head of the US Food and Drug Administration (FDA) emphasized a need to address the high costs that patients face for cancer drugs, while also announcing a series of steps that his agency will take to try to increase use of next-generation sequencing for speeding discovery of new treatments.

In a speech here yesterday at the Community Oncology Alliance's conference, FDA Commissioner Scott Gottlieb, MD, said that cancer patients "are disproportionately shouldering" the price of their medicines, even though these costs represent only a fraction of the total costs of their care.

Dr Scott Gottlieb. REX/Shutterstock

"Rising copays and coinsurance are pushing far too many patients into a financial no-man's land where sometimes they must literally choose between exhausting their bank accounts or going without access to potentially effective treatments," said Gottlieb, himself a cancer survivor.

The speech was well received, particularly because Gottlieb focused on a key concern for many cancer physicians while delving into challenges of advanced technologies.

"He started with what we call 'the elephant in the room,' which is the cost of drugs," Jeffrey F. Patton, MD, the chief executive of Tennessee Oncology and a member of the board of the Community Oncology Alliance, told Medscape Medical News in an interview at the meeting.

Gottlieb tossed out informal suggestions during his speech and a subsequent question-and-answer session about specific pricing issues that the federal government could address. Implementing payment system changes would be beyond the scope of the FDA, which focuses narrowly on the safety and effectiveness of medications.

Still, Gottlieb argued that his agency has a role in addressing the "financial toxicity" of cancer treatment.

"If anticompetitive forces and profit taking across the drug supply chain are pushing effective treatments out of the reach of patients, the full benefits of innovation to improve public health are not being realized," Gottlieb said. "And although it isn't our primary role, Congress gives us responsibility for fostering competition in product markets."

Gottlieb's ideas on drug pricing may carry extra weight with the lawmakers and federal officials who are looking at ways to rein in the growth in drug costs paid by consumers. In addition to practicing medicine, he has deep experience in business and payment issues. Gottlieb has been an advisor and director of several biotechnology companies and also served a short stint as a senior advisor at the Centers for Medicare & Medicaid Services. In addition, Gottlieb's time as a fellow at the American Enterprise Institute, a conservative think tank, further deepened his connections in Washington policy circles.

Different Payment Models

During the question-and-answer session, Gottlieb said the current Medicare model for paying for many cancer drugs may not work at a time when the costs of newer treatments can soar near the $1 million mark. The current model calls for tacking a 6% premium onto the reported average sales prices of medicines administered in physicians' offices. Federal budget law has shaved that reimbursement a bit in recent years.

"I think we need to think about different payment models," Gottlieb said, referring in this case specifically to cancer medicines with very high annual costs for patients.

CMS officials are taking a close look at different approaches for handling the high cost of medicines, Gottlieb said. "They've been talking about this for many years, but I know that they're looking very actively at that," Gottlieb said.

There appears to be growing frustration among oncologists about the seeming inability of the federal government to rein in the rising costs of cancer medicines, as seen at a March incidentat the National Comprehensive Cancer Network 23rd Annual Conference. Government officials now are trying to manage a pricing crisis that's being generated in part by much welcomed advances in medicine. There have been many cases of sticker shock for newer novel cancer drugs, such as the roughly $475,000 price tag seen last year for Novartis' leukemia treatment Kymriah.

NGS Guidance

In his speech, Gottlieb outlined an ambitious goal of using FDA policy to encourage use of newer technologies that could in time shave the costs of developing drugs and thus help people better afford their medicines.

"If we can reduce not only the direct costs of development, but the time and risk embedded in these endeavors, we can reduce the cost of the capital needed to underwrite new discovery," Gottlieb said. "We can have more capital chasing more opportunities to improve patient care. And we can do it all and lower costs for patients."

To serve this aim, the FDA on Thursday released two final guidance documents regarding next-generation sequencing (NGS) and a draft guidance regarding in vitro diagnostics for oncology trials, Gottlieb said. The actions follow another federal decision that developers of NGS tests had welcomed: CMS's March announcement that it will now cover the cost of NGS tests for patients with cancer. The agency finalized a national coverage determination that covers diagnostic laboratory tests using NGS and will reimburse Medicare recipients with advanced cancer.

One new FDA guidance, titled "Use of Public Human Genetic Variant Databases to Support Clinical Validity for Genetic and Genomic-Based In Vitro Diagnostics," tells how developers of NGS tests may rely on clinical evidence from FDA-recognized public databases to support clinical claims for their tests. These public databases may include resources such as ClinGen, which is maintained by the National Institutes of Health, the FDA said.

A second FDA guidance, issued on Thursday, is titled "Considerations for Design, Development, and Analytical Validation of Next Generation Sequencing (NGS)–Based In Vitro Diagnostics (IVDs) Intended to Aid in the Diagnosis of Suspected Germline Diseases." It offers recommendations for designing, developing, and validating NGS-based tests to diagnose individuals with suspected genetic diseases, the FDA said in a press release.

Gottlieb on Thursday also said that the FDA will issue draft guidance titled "Investigational In Vitro Diagnostics in Oncology Trials: Streamlined Submission Process for Study Risk Determination." It describes for sponsors of certain oncology trials what Gottlieb called "an optional streamlined submission process" that will help determine whether use of an investigational in vitro diagnostic (IVD) — including IVDs that incorporate NGS technology — in a trial of investigational cancer drug or biological products is considered to be associated with significant risk or nonsignificant risk or whether it should be exempt from review.

In his speech, Gottlieb said the new NGS guidance may help in time to ease the regulatory burden associated with developing these tests, and even perhaps allow exemption from premarket review in certain cases. These tests are seen as critical with respect to efforts to correctly match a patient's disease to increasingly targeted cancer medicines.

"We talked longingly about the era of truly personalized patient care for many years," Gottlieb said. "When it comes to oncology, that promise is not just being made manifest. It's becoming the clinical norm."

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