Boom time for HCV testing: US health officials released proposed guidelines Friday recommending that all baby boomers should be tested at least once for the hepatitis C virus, which is transmitted through contaminated blood and is often undiagnosed. Infection rates of the silent epidemic have dropped since the 1990s thanks to better blood and organ screening technology, but according to the CDC one in 30 baby boomers (defined as born between 1945 and 1965) are infected with HCV and don’t know it. John Ward, director of the CDC’s viral hepatitis division predict a blood test would identify hundreds of thousands of infections. The proposed guidelines will only fuel the already rampant desires of many biopharmas to become HCV powerhouses. Gilead and Bristol-Myers Squibb are currently duking it out to become the first to offer a non-interferon based regimen, but with new screening guidelines dramatically increasing the treatment pool, expect other companies to look at the space with interest. For payers, meantime, the CDC recs mean more hard choices. With two new hep C drugs on the market – Incivek and Victrelis – payers are already scrutinizing costs in this specialty arena. According to the 2011 Express Scripts Drug report, hep C isn’t in the top 5 costliest specialty trend areas…yet. But if these new guidelines go through, even the screening costs alone could be significant. According to the US Census bureau 76 million children were born between 1945 and 1965; if testing costs $50 a pop, that’s around $3.8 billion just to screen the estimated at-risk population. True, that 76 million is likely an overestimate (some have died or moved away) and others won’t need to be screened. The point of this admittedly back-of-the envelope calculation is to highlight that testing alone may result in big healthcare dollars — and we haven’t even gotten to the treatment costs associated with the 800,000 individuals expected to be identified according to CDC estimates. That’s not to say the CDC recs are unwarranted. Some 1000 hep C patients develop liver cancer annually, and require transplantation, and the estimated costs of that procedure are around $280,000 a patient. But the reality is these new hepatitis C costs mean payers will have to make hard choices about other therapies deemed less valuable. FYI, the CDC is accepting public comments on the draft recommendations from May 22 to June 8.—Ellen Licking
Pricing and market access ARE pharma’s biggest problems: If you’ve been reading our posts, you already know this. But these days every major pharmaceutical exec also seems to be singing the same song—nor do they have straight-forward solutions to the reimbursement problem. The continuing pressures of patent expirations, poor drug launches, and struggling R&D engines mean the glass is half empty for many in the biopharma industry. (Especially at a time when Facebook can muster $16 billion via its IPO.) That outlook was on full display at a May 3 conference sponsored by Sanford Bernstein. The Bernstein event, held annually in early May, has quickly become a must-attend event for senior biopharma leadership to opine on a critical topic facing the industry. This year’s topic: pharmaceutical pricing and market access with participation from Pfizer, GSK, and IMS executives. (Past subjects have included emerging markets and improving R&D productivity.) In a note to investors, Bernstein analyst Tim Anderson discussed the downbeat mood, as patent expiries continue to exact their toll on revenues, especially in the area of oncology. According to IMS, prices of branded oncologics that lost exclusivity in 2010 and 2011 fell 30% in Italy and 85% in the US when generics hit the market. From a pricing standpoint, the lone bright spot continues to be the US market; the question, of course, is how much longer can the US continue to subsidize high pharmaceutical prices given our own economic travails. An interesting tidbit from the meeting – big pharma needs more advice when it comes to pricing in emerging markets. The days when companies could set one global price for a product are long gone; but the need to adopt flexible regional pricing schemes is only growing as companies rely on the rapidly growing emerging markets for product uptake. The issue, as Anderson writes in his note, is that the infrastructures supporting payers, providers, and patients in countries like India, China, and Russia are not well defined. Unsurprisingly, there is often a correlation between government support of healthcare and pricing; companies price drugs lower when, as in many cases, patients pay most of their medical expenses out-of-pocket. –HB
- Big Pharma insiders pessimistic about pricing going forward. [The Pink Sheet Daily ($)]
No change of heart for good cholesterol: It is widely accepted that lowering bad cholesterol, also known as LDL, through diet, exercise or statins reduces the risk of heart disease. Raising levels of good cholesterol, HDL, has also been thought to decrease the risk of heart disease. However, a new study published online Wednesday in the Lancet raises serious questions about the validity of the HDL hypothesis. Funded by the NIH, Wellcome Trust, British Heart Foundation and the German Federal Ministry of Education and Research, the research suggests higher HDL levels do little to beneficially impact a patient’s risk of hear disease. The study analyzed the genetic information of thousands of patients across 14 HDL variants and found no association between having increased HDL and a lower risk of heart disease. The researchers suggest that the relationship between HDL and heart disease may not be causative; rather, high HDL levels may be a sign for something else that makes heart disease less likely. Meantime trials for HDL-boosting drugs have pretty much all failed to result in fewer heart problems– most recently, on May 7, Roche pulled out of an ineffective 15,000-patient study early because the data were so unpromising. With Roche and Pfizer ditching the HDL-booster camp, the news isn’t promising for Merck and Eli Lilly who are both working on similar treatments.–HB
- Read the story on the research findings from the NY Times.
- Read the research article published in The Lancet here.
- Read more on the HDL drugs in development here.
On equal insurance coverage for oncology treatments: The advent of new, highly effective – and very expensive — oral oncologics offers patients a more convenient means of taking their chemotherapy. But it’s almost never less expensive than an infusion or injectable – at least for the patient. That’s because most oral oncology drugs are covered under the pharmacy benefit (as opposed to the medical benefit) and come with hefty co-pays that are calculate as a percentage of the drug cost. This becomes an affordability issue for patients given many oral cancer drugs cost tens of thousands of dollars. In contrast chemo covered under the medical benefit usually means a patient owes a flat out-of-pocket fee that is capped annually, ultimately restricting the overall cost to the patient. As the Washington Post and Kaiser Health News point out in a jointly authored piece, the coverage disparities between oral and IV cancer treatments has resulted in a groundswell of advocacy for “oncology parity laws. ” Thus far, 19 states have passed laws requiring insurers to provide equal coverage for oral and infusion treatments. One of the central issues of concern: whether the high cost of co-pays for oral cancer drugs is negatively impacting patient adherence. In a study of pharmacy claims from over 10,000 patients with Medicare and commercial insurance, 25% of patients didn’t fill their initial prescriptions if the out-of-pocket expense was over $500. Only 6% of patients with medication costs of less than $100 didn’t fill their initial prescriptions. On the other hand, the estimated cost to most health plans if they were to provide equal coverage for all oncology treatments would be less than 50 cents per member per month, according to a 2010 study conducted by healthcare benefits consultant Milliman. –HB & EL