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Sustaining Healthcare and Drug Costs

By Allan Maurer, NC Biotech Writer

Healthcare spending rose to 17.8 percent of the GDP in 2015 according to World Bank data, reaching $3.2 trillion, or nearly $10,000 a person. Neither that nor the rising costs of prescription drugs is sustainable in the long run, agreed a panel of experts at the Life Sciences Forum discussion of “Value Based Medicine: The Collision of Innovation and Affordability,” Monday at the North Carolina Biotechnology Center.

Innovative new medicines and therapies now cure previously life-threatening diseases and help provide sufferers from many others with a better quality of life. But the cost of such innovation can be devastating. “Record costs are staring everybody in the face right now,” said panel moderator Susan Cantrell, CEO of Academy of Managed Care Pharmacy.

Jane Reese Coulbourne, a senior consultant with Mark Krueger & Associates and a 26-year survivor of late stage cancer herself, cited a recent study from Emory University that said nearly one in three non-elderly cancer patients not covered by Medicare aren't taking prescribed drugs because they can’t afford them. She added that the Fred Hutchinson Research Center in Seattle reports that people with cancer are three times more likely to declare bankruptcy.

“There is a term being used in oncology for this effect on those under 65. Financial toxicity,” she said. Medical expenses can even bankrupt small and medium-sized companies, she added.

Reese-Coulbourne, who also started the National Breast Cancer Coalition and has been involved with patient advocacy groups, and was the founding executive director of the Reagan-Udall Foundation for the FDA, said state Right to Try measures aimed at increasing access to experimental drugs are largely “feel-good legislation that don’t do much.”

The Trump campaign talked a lot about passing similar federal legislation and the new administration says now it will be included in an Affordable Care Act replacement bill, but Reese-Coulbourne notes, “The system is having trouble providing access to FDA-approved drugs. Now there is going to be pressure to allow access to experimental drugs?”

A key to improving the whole system, Reese-Coulbourne and the other panelists agreed, is evidence-based medicine assessing the value of a given drug or therapy. “The challenge to the payer is to provide the right diagnosis at the right time for the right patient at the right cost,” said Janet McCauley, M.D., senior medical director, Blue Cross Blue Shield of North Carolina. The ideal would be to tie coverage and payment to outcome, but that’s easier said than done, she added. Blue Cross Blue Shield is implementing one new program along those lines in a month to establish a pathway for oncology drugs that will examine their effectiveness and cost-safety profiles.

Shawn Davis, PharmD,  senior director of formulary solutions with the Express Scripts oncology share value program, said, “We want to be guided by evidence-based practice. We want to make sure drugs provide the benefit intended.” Express Scripts, based in St. Louis, Missouri, is the largest pharmacy benefit management organization in the United States. It sees 1.4 billion prescriptions a year.

“We saved our clients a billion dollars last year,” he said. One way the company achieves savings, he said, is by “Creating a space where manufacturers can compete to get drug costs down to the best price.”

McCauley said Blue Cross Blue Shield works with other technology assessment companies, beginning by discovering “What is out there” and then asking, “What is the quality and weight of the evidence?” The way evidence translates into coverage policy, she said, “Is multi-dimensional and we get a lot of information from different stake holders. A lot of factors converge to formulate clinical coverage policy.”

The panel noted that a movement toward including patients and “real-world evidence” at every stage of drug development and approval, from manufacturer to the FDA.

Chris Little, PharmD, BCPS, director for Pharmacy and Diagnostic Imaging at ROi, said, “The thing we always struggle with is what does the evidence tell us and then, what does practice tell us?”

“Patients are becoming more involved in decisions about what comes to market, sitting on FDA panels and becoming much more vocal. When is that appropriate?” asked moderator Cantrell.

“Companies are doing it at the very early stages, pulling in patients for advisory boards,” said Reese-Coulbourne. "They consider questions such as what kind of products interest people.” One reason for getting consumer input is to avoid a social media blitz demanding access to a drug a number of companies have experienced.

The panel considered a number of current trends, precision medicine, genetic diagnostics and other innovations with the potential to help get the right drug to the right patient at the right time and the right cost.

“A lot of therapies coming out today have a diagnostic paired with it,” Davis said. “Payers are more likely to cover that than they are with today’s shotgun approach. But when you get to million-dollar therapies, the question is how much can you afford.”

Value frameworks being tested by the American Heart Association and Sloan-Kettering among others is a new concept that is generating interest, Cantrell noted. The value frameworks provide an index, score and dollar amount for treatments.

“Value frameworks are a step in the right direction,” Davis said, “But they need more teeth. We used them for our oncology value program. They’re good starting places.”

One problem facing everyone dealing with evaluating drugs is the lack of a central depository for medical data, Davis said.

Reese-Coulbourne, near the end of the discussion, said, “There is a Chinese curse: 'May you live in interesting times.' We’re there now.”

Details are available here for the Express Scripts Lab-Drug Trend report.

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