Can We Afford the Cost of Myeloma Therapy?

June 25, 2018

CHICAGO — Over the past few years, the approval of several new drugs for multiple myeloma, as well as evolving strategies for stem cell transplant, have contributed to increased survival and improved quality of life for many patients with this disease.

However, the new agents come with hefty price tags, and multiple myeloma has become a very expensive disease to treat. Can we afford it? Or not?

That was the debate between two experts at the recent annual meeting of the American Society of Clinical Oncology.

S. Vincent Rajkumar, MD, professor of medicine, Department of Hematology, at the Mayo Clinic School of Medicine, Rochester, Minnesota, argued that the cost of care is not affordable and that action needs to be taken.

"I don't like this debate, and I don't think that there is anything here to debate," he said as he opened his talk. "It's like debating whether the earth is flat or not — these drugs are expensive."

Rajkumar reported that although he has no conflicts of interest, he has stated that he is "very interested in this topic" of drug prices, and he pointed to an article that he and his coauthors wrote in 2012 concerning the high cost of drugs in the United States.

"It is sad that when we wrote this paper, the US spending on cancer drugs was $25 billion, and in just 5 years from then, it is now $50 billion," he said.

Rajkumar emphasized that he is not an enemy of the pharmaceutical industry and in fact works very closely with them. He has led more than 20 clinical trials, including regulatory studies with several drug manufacturers. Their talk was not an attack on the industry, he emphasized.

He went on to outline the magnitude of the problem.

In the United States, 30,000 patients were diagnosed with multiple myeloma in 2017. The total lifetime cost of treatment was $22.4 billion. This figure excludes spending on hospitals, nurses, infusions, imaging, physicians, laboratory studies, and other ancillary costs.

I should stop the debate here, because this is just not affordable. Dr Vincent Rajkumar

"I should stop the debate here, because this is just not affordable," he said.

The problem is that the cost of the drugs is too high, he continued.

For 11 agents used in the treatment of myeloma, the cost ranges from a low of $5800 per year for cyclophosphamide (multiple brands) to a high of $192,000 per year for pomalidomide (Pomalyst, Celgene). Carfilzomib (Kyprolis, Onyx Therapeutics) is even more costly ($260,000) if it is given at a dose of 56 mg/m2.

However, the actual costs are even higher, because these drugs are not used as monotherapy but in combinations, often with two other drugs. Triple therapy runs from $220,000 to 300,000, depending on the combination, "and now we are hearing chatter about quadruplets," he added. "Are we kidding?"

The price for quadruplet therapy could run from $340,000 to $500,000 per year, depending on the particular combination.

Rajkumar returned to the figure of $50 billion spent on cancer drugs in 2017.

Of that figure, 80% is accounted for by only 35 drugs.

Of those 35 drugs, six are for myeloma.

Yet myeloma comprises just 1% of all cancers, he pointed out.

The underlying problem is not just the cost myeloma drugs — it is the high cost of all new cancer drugs.

Each drug approved by the US Food and Drug Administration (FDA) in 2017 costs $100,000 or more, with an average cost of $150,000. In 2017, for the first time, five new drugs were priced $300,000 or more per year.

Rajkumar then put these prices into perspective. Given the fact that in the United States, the average household income is $52,000, it would take 10 people to support 1 year of life. The cost of drugs leads to problems with treatment adherence and bankruptcy.

The problems with cost are not just related to innovation. "It's not just fancy new drugs that are being made with a lot of hard work and randomized trials," he said. "It's all drugs."

As an example, there was the famous case involving Martin Shkreli and Turing Pharmaceuticals. Shkreli purchased rights to pyrimethamine (Daraprim, Vera Pharmaceuticals), a drug originally developed in the 1950s. Overnight, the price of the drug jumped from $13 to $750 per pill. Shkreli is currently in prison, but not for this reason; as Rajkumar explained to the audience, his increasing the price of the drug was perfectly legal.

"The price of Daraprim right now in Costco is $4477 for 1 month's supply," he said.

Why Are Prices So High?

So all of this begs the question — why are prices so high? Rajkumar offered a few explanations.

First is the cost of drug development. Although estimates vary, ranging from $700 million to $2 billion, the bottom line is that it is a very expensive endeavor.

Second, he noted, is the seriousness of the disease. "If you or your loved one has cancer, you're willing to do just about anything," he said. "If I can't afford it, if I need to sell my house, I will somehow get the money to pay for this drug."

And third is the "blatant and occult patent evergreening." The cost remains high as long as the drug remains on patent, but as the end of the protected period approaches, companies will do everything possible to delay patent expiration.

There are other problems with drug costs, some of which are unique to the United States. One is that Medicare cannot directly negotiate with pharmaceutical companies. But there are many others: there is a ban on personal importation; the reimbursement system gives higher fees to physicians who use more expensive treatments; there's liberal off-label use; and there are also several middlemen between the payer and the pharmaceutical company, all of whom profit from high prices.

Finally, there is also a lack of "allies." He noted that many physicians have consulting agreements, serve on advisory boards, are on steering committees, and run clinical trials for industry. "They don't want to take on pharmaceutical companies," Rajkumar said.

Suggestions for Solutions

"This all sounds pretty sad or pretty distressing," Rajkumar commented, but there are some solutions. He outlined several steps that can be taken, many of which have been proposed and discussed by others.

One example is the need for value-based pricing.

"A high list price regardless of the value that the drug provides is the enemy of innovation," he commented. "If you can make money with a 'me-too' that prolongs life by an extra 1 week over the previous drug, why would you take the risk and develop a brand new compound that may fail in phase 3, and you've just burned $2 billion?"

Another solution that has also been proposed is that Medicare needs to be able to negotiate prices. Another solution would be to permit personal reimportation, which would facilitate the entry of generics and biosimilars into the marketplace. Yet another would be to reduce the cost of new drug development.

On this last point, Rajkumar commented, "In our good intentions of making everything super, super safe, we have so many regulations so that every t is crossed and every i is dotted, to the point that it costs $30,000, $40,000 per patient to do a trial.

"The FDA needs to back off on regulations so that you can bring new drugs to market more easily and more readily," he said.

Rajkumar emphasized that physicians always want to give the best treatment, but with respect to myeloma, the best treatment may be just too expensive from the standpoint of both the patient and society. "So we may have to use the best possible option," he said.

Steps can be taken to lower the cost of myeloma treatment, such as modifying the induction regimen or limiting maintenance to 1 or 2 years instead of 10 years. "You then save $150,000 per year," he noted. "You could give consolidation and slow maintenance, and, in some places, transplant is really cheap compared to new drugs. In that case, transplant can be used more effectively."

Another step that can be taken is to incorporate cost considerations into clinical guidelines, he said. Thus, for selecting a treatment regimen, guidance would not only be best in the medical sense but also in the economic sense. One example is zoledronic acid (Reclast, Zometa, Novartis) vs denosumab (Prolia, Xgeva, Amgen), both of which are used in the treatment of myeloma patients to prevent skeletal-related events, including fractures.

A recent trial showed the two drugs to be similar in efficacy, but there is a big price difference — $60 for zoledronic acid, and $2000 for denosumab — Rajkumar pointed out.

Conducting strategic trials is another approach. The endpoint may be not only improving survival but also cutting costs and improving quality of life. An example is response-directed therapy. If a patient is found to have negative minimal residual disease, can therapy be stopped? "Because then we can maybe give patients a break, as well as not give an expensive treatment for 2 or 3 years," Rajkumar noted.

There is also a need for strategies that are focused on cure. "If we go all out for the cure by treating early-stage smoldering myeloma and we can cure it, then we immediately lessen the duration of therapy and immediately lessen the total cost burden," he said. "We'll never be able to find out if we are curing myeloma if we are doing trials where there is no end to the treatment."

In addition, advocacy is needed. Oncologists need to get together and argue for the reforms that will lead to lower drug pricing, he said.

Rajkumar ended his talk with a direct appeal to patients. "I understand that the last thing on your mind is to take on another battle to lower drug costs," he implored, "but we need you. Other patients need you. More important, you need it for yourself. If drugs that hardly work for a month or two can be priced at a fortune, it detracts from true innovation."

Drugs Are Not the Problem

Taking the opposing viewpoint, Rafael Fonseca, MD, chair of the Department of Internal Medicine at Mayo Clinic in Arizona, offered what he explained was a "counterperspective to what you regularly read in medical journals and news outlets."

"I think we all want to get to a better place — a place where there are drugs for everyone. We just have different paths on how we think we can accomplish that," explained Fonseca. He then asked attendees to "please listen openly to what I'm about to tell you, as I'm going to give you considerations you normally don't hear."

He reiterated that much progress has been made in myeloma and that the improvement in survival is "astounding."

However, he said the disease continues to remain "humbling" and that today's best is simply not good enough. "And today I'm not here only to convince you that we can afford them but that we cannot afford to stop innovation and move forward, as we are ever so close to curing a large fraction of myeloma patients."

We cannot afford to stop innovation and move forward, as we are ever so close to curing a large fraction of myeloma patients. Dr Rafael Fonseca

He said that he agrees with Rajkumar on many of the issues, such as generics — both believe that these drugs should be inexpensive. However, they also have some fundamental disagreements. Fonseca stated that he challenges the belief that drugstore prices are rising faster than anything else, as well as the notion that patients are unable to access these drugs due to copays and other factors and "that we don't get the value. And whether something 'must be done' at this point."

Drug costs represent 10% of total healthcare costs in the United States, and in cancer, that number rises to 20%, he pointed out. Myeloma drugs are particularly pricy and constitute an even higher amount of total costs — 30%. But this debate is not about the price, Fonseca emphasized; rather, it is about whether "we are getting value for these drugs."

In 2017, IQVIA reported a net increase in drug costs of 1.9% and projected 1.4% increases for the next 4 years. Fonseca emphasized that no one ever pays the list price for drugs; the cost that is eventually passed on to the patient and the payer is a negotiated one.

There are problems with the negotiating process, however, especially with pharmacy benefit managers (PBMs) who have some "nefarious aspects on how they deal with this, including the fact that part of these rebates don't necessarily go fully to patients," he commented.

This in turn means that patients are sometimes charged when a copay is based on a percentage of what the list price might be. "I think there's significant room for improvement, and Dr Rajkumar and I agree on that," he said.

From a macroeconomic perspective, Fonseca said that it has been reported that if the rate of cancer mortality could be changed by just 1%, the economic benefit for current and future generations of Americans would be $500 billion. If there was a way to cure all cancers, the net value would be $50 trillion.

"Just this month, the Journal of Cancer published a report saying that from 2010 to 2015, the mortality from cancer fell by 1.5%," he said. "It might not seem like a lot, but that's a value of $750 billion. That's a lot of money, and if that's permanent, obviously a great benefit."

For myeloma, there was a dramatic increase in the yearly cost of drugs from 2004 to 2009, at which time bortezomib (Velcade, Millennium) and lenalidomide (Revlimid, Celgene) came into widespread in use. Cost rose from $36,000 per year in 2004 to $109,000 per year by 2009. "However, when you consider the economic benefit, this was offset by $67,000 in health benefits for patients," Fonseca explained. "In other words, with these drugs, patients are living longer, and there is an economic benefit that comes back to the economy at large. That's the macroeconomic benefit that we're seeing in myeloma, and that means we are getting value for the expense of those medications."

Access for Most Patients

Fonseca next tackled affordability. He pointed to a study of Diplomat Pharmacy, which dispensed immunomodulatory imide drugs (IMiDs) from 2011 to 2013. During that period, Diplomat filled nearly 80,000 IMiD prescriptions (Journal of Medical Economics. 2016;19:397-402). "Post financial assistance, the median copay was $80, with 91% of patients paying less than $100," he said. "Now, I'll be the first to say $100 can be quite a bit of money for families with limited resources and income, but this is quite different from what you're hearing right now in the news outlets."

A study from 2016 reported that the median copay for specialty drugs was $35. It was found that most patients had access to their prescribed drugs.

"So in other words, we are getting the drugs to the patients, so that is not an argument," he said. "The argument really is the value of whether we're paying too much and whether society gets back in return what is being invested in cancer care."

Overall, patients with commercial insurance can receive copay assistance and can often end up paying a nominal fee. For example, the vast majority of patients can receive lenalidomide for less than $25 a month. For patients without insurance, medication can usually be obtained at no charge from the manufacturer. But the challenge to treatment often lies with Medicare.

Fonseca explained that copay assistance cannot be obtained directly from Medicare and must involve a third party. "But this is problematic, particularly because patients have to go through this rigamarole of securing that support," he said. "And often patients are shocked by a sticker price."

He noted that some may see this "as a nefarious practice — a practice that just really rigs the system." But until there is an alternative method of assistance, "getting rid of this would be very, very problematic for all Medicare beneficiaries."

Another issue is the high rate of reported bankruptcy that has been associated with medical costs. A cancer diagnosis doubles the risk for bankruptcy; one study showed that the risk rises from 0.7% to 1.7%. "However, there is not a single study in the literature that has ever linked copays with bankruptcy — not a single one," Fonseca emphasized. He did concede that many other factors are involved, such as physician and hospital bills, the cost of travel and meals, and other expenses.

"Perhaps more important, the patient and their caregiver have to stop working because of the cancer diagnosis, and oftentimes this happens in families with limited savings," he noted.

But the percentage of bankruptcies that can be attributed to medical costs is actually much lower than previously believed, at least according to a recent analysis in the New England Journal of Medicine (N Eng J Med. 2018;378: 1076-1078). "The title spoke of the myth of medical bankruptcy, stating that they estimate that about 4% of bankruptcies, not 50%, may be caused by medical expenses," he said.

Last year, Fonseca and his colleagues published a study (Leukemia. 2017;31:1915-1921 of "real-world spending" for myeloma. Total healthcare costs for myeloma patients rose from $3263 in 2000 to $14,656 in 2014, but this increase was primarily driven by the cost of inpatient admissions and outpatient services. In contrast, the relative contribution of drug costs had remained fairly stable since 2009, despite novel therapies coming to market.

Drugs are one of the drivers of cost, Fonseca said, and cost has gone up. "But it's not the only driver, perhaps not even the key driver, of what's driving up the cost and the expense of caring for myeloma patients."

He then pointed out differences in spending between the United States and the European Union. In the EU, the gross domestic product (GDP) is $8.4 trillion, and they spend about 10.9% of this on healthcare. In the United States, the GDP is about twice as high, 15.6 trillion, and 17% of that is spent on healthcare. However, spending in oncology is nearly equal, 4.8% in the United States vs 4.9% in the EU. "This is despite the fact that we spend more in drugs," he said. "And we think part of this relates to the benefit that comes from novel drugs preventing hospitalizations and other complications associated with cancer."

Avoid Market Interference

Fonseca disagreed with Rajkumar about the need for more regulations and especially Medicare negotiation. He emphasized that both government agencies as well as others have questioned whether this would even be possible. "In fact, some of the purchasers of drugs in the United States have more negotiation power than most European countries," he said. "It is not clear how that's going to happen. And, to me, when we talk about negotiation via Medicare, what we really are asking is for price fixing, usually in the form of formulary."

He then "made a plea" to attendees, asking them to "avoid market interference," because the patented drugs of today are the generics of the future, and if innovation is stifled, there won't be any generics in the future.

He said that although this reasoning may be unfamiliar to people in the medical field, it is very clear in the economics literature. "Price fixing kills innovation. This is beyond debate, period. So if we engage in that, today's best is simply the best that it's going to be."

Fonseca urged his colleagues to reject proposals such as having the government come in and declare eminent domain on intellectual property. He explained that he is also not in favor of importing patented drugs. "It's like saying, I could see my movies for cheaper through my Web service, and, by the way, I'm not paying royalties to those that produce that movie," he said.

He noted that this "bullish environment fosters innovation," and although some are worried about investors, Fonseca stated that he welcomes them. "I prefer investors be in healthcare than them being in telecommunications, transportation, and other industries."

As he wrapped up his talk, Fonseca offered a set of suggestions, which he described as "improvements" because they are not necessarily solutions.

"I think we should accelerate drug approval, and we would should accelerate, like Dr Rajkumar says, the transition of patented to generics," he said.

He also feels that third-party payers should be minimized in the supply chain. "I urge you — let's not put the patients in the middle by interfering with copay assistance programs."

Another improvement would be to initiate reference pricing. EU countries and those with a similar GDP per capita pay far less for drugs than in United States, and they can't be forced to pay more. However, he suggested that the playing field can be evened out through trade agreements. "But, to be honest, our European colleagues do the best phase 3 clinical trials, as opposed to what we do in the United States."

He concluded by emphasizing the success that has been seen in recent years in the treatment of multiple myeloma, but also emphasized that "today's best is simply not good enough, and we cannot stop at this point."

Fonseca added that he would "trust Dr Rajkumar with my life if I were diagnosed with myeloma. But I think he's wrong on drug economics."

Dr Rajkumar has disclosed no relevant financial relationships. Dr Fonseca consults for Amgen, BMS, Celgene, Takeda, Bayer, Jansen, Novartis, Pharmacyclics, Sanofi, AbbieVie, and Merck and is a member of the scientific advisory board of Adaptive Biotechnologies.

American Society of Clinical Oncology (ASCO) 2018. Presented June 3, 2018.

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