An article for STAT News highlighted Partnership to Improve Patient Care's (PIPC) Disability Advocate Ari Ne’eman's comments on the importance of assessing the value of medicines using treatment metrics that are specific to particular conditions or diagnosis, instead of relying on the flawed quality-adjusted-life-years (QALY) method. Ne’eman noted that due to the fact that it is inherently discriminatory against certain patients, the use of the QALY method in determining coverage for health plans is “of grave concern.” The article also amplifies Value Our Health's criticism of discriminatory value assessments during a briefing the group held, in which patient groups discussed objections to the Institute for Clinical and Economic Review’s (ICER) recent analysis of a Novartis MS drug and a new Johnson & Johnson antidepressant.
The article in its entirety can be read below.
ICER says pricing for Novartis MS drug ‘far out of line,’ but more groups push back
By ED SILVERMAN
A controversial cost-effectiveness watchdog has declared that Novartis (NVS) priced its recently approved multiple sclerosis drug “far out of line,” the latest slap at the pharmaceutical industry over pricing for such treatments. But critics are using the watchdog’s analysis to push back on the approach it takes to assess the value of new medicines.
In its analysis, the Institute for Clinical and Economic Review determined the $88,500 list price for the Novartis drug, called Mayzent, was not worth the money because the Food and Drug Administration approved the treatment for a different patient population than the one studied in late-stage clinical trials. Because of that, its assessment was modeled on a different group.
Mayzent was approved in March for adults with relapsing forms of multiple sclerosis, including active secondary progressive disease (SPMS), which is characterized by irreversible disability as the disease progresses. But the FDA concluded the drug was not effective in forms of MS where relapses have stopped but the disease continues to progress, which is known as non-active SPMS.
An ICER spokesman explained the nonprofit focused on use in patients with both active and non-active SPMS, where there is a large unmet need and where Mayzent would have been the only approved treatment. If the FDA had approved the drug for just active SPMS, ICER would have suggested the price should be about $22,000 to $32,000 to be considered cost-effective, he added.
If the agency had instead approved the Novartis medicine for all forms of SPMS, he said, ICER calculated a cost-effective price would be more like $8,000 to $12,000 a year. In any event, the pricing is well below what Novartis is charging. ICER, by the way, determines pricing based on QALY, or quality-of-life years, a benchmark that measures both the quantity and quality of life generated by providing a treatment.
A Novartis spokesman wrote us that feedback and recommendations to ICER were not fully reflected in the report. “ICER established the cost-effectiveness based on a comparison to no treatment, while, in practice, most SPMS patients are today treated with drugs that have not been proven in a trial prospectively powered to demonstrate efficacy in a SPMS population.”
The cost of MS drugs, in general, has been a flashpoint in the wider debate over pricing.
The wholesale, or list, prices for a dozen medications — new and old — continued to rise between 2014 and 2019, according to academics at Oregon Health and Science University, whose earlier research found prices for older medicines kept rising even as newer treatments were launched. The prices for those medicines ranged from approximately $76,000 to nearly $99,000.
And a recent study found that MS patients paid an average of $15 a month in out-of-pocket costs in 2004, but that jumped to an average of $309 a month by 2016, a 20-fold increase over a 12-year period. Meanwhile, patients with a high-deductible plan paid an average of $661 per month compared to $246 a month for those not in a high-deductible plan two years ago.
This is only the latest assessment from ICER to draw the ire of drug makers and patient groups, which regularly argue that the methodology used by the nonprofit is flawed and as a result discriminates against chronically ill patients, the elderly, and people with disabilities. New drugs exceeding the QALY threshold may not be covered by health plans.
“The real concern is that by relying on QALY instead of treatment metrics that are specific to particular conditions or diagnosis, ICER is undervaluing treatments that people with disabilities have come to depend on. And many payers are relying on ICER reports to determine utilization management. This is of grave concern,” said Ari Ne’eman of Value Our Health, a coalition of patient groups.
Such complaints have picked up steam as ICER has become something of a de facto arbiter of cost-effectiveness in the U.S., balancing cost and clinical effectiveness. Although many countries rely on cost-effectiveness in setting drug prices, the U.S. government does not have such a mechanism, which has allowed ICER over the past five years to fill the void.
And the nonprofit, which relies on funding from insurers but also some drug makers, has grown more controversial because its rise to prominence has coincided with the growing national angst over the cost of medicines in general. Pharmaceutical industry critics often point to ICER reports as evidence that drug makers price their medicines exorbitantly.
At the same time, a growing number of groups are pushing back. Leading the charge is the Partnership to Improve Patient Care, whose members include pharmaceutical industry trade groups. It is a key organizer behind Value Our Health, which includes professional medical societies and patient advocacy groups, some of which have accepted funding from drug makers.
On Friday, in fact, Value Our Health hosted a media briefing to discuss its objections not only to the analysis of the MS drug, but to a new Johnson & Johnson antidepressant called Spravato. At the same time, the Pioneer Institute for Public Policy Research, a right-leaning think tank, issued a white paper that argued ICER methodology for assessing the value of gene therapies is obsolete and arbitrary.
