Vantage Point

The last two years saw controversy regarding the drug approval process. At the same time, launch prices for cancer drugs have climbed as manufacturers struggle to recoup development costs despite a need to target small patient populations. Healthcare reform has brought renewed interest in examining cost effectiveness. Recent FDA and CMS activities related to Avastin for metastatic breast cancer and Provenge for metastatic prostate cancer have led to speculation that the agencies have already begun to consider cost.
Despite the potential increase in those with coverage under reform, it is important to consider price pressures that will affect oncology. Brand teams willing to risk increased public and payer scrutiny may choose to continue price increases for now. Changes in the 340B Drug Pricing Program raise more questions about the value of contracts with hospital and community GPOs; brands may need to reduce deals to salvage margins. Benefit designs that increase patient cost-sharing for cancer drugs are on the rise, often with out-of-pocket costs for higher-cost therapies as a percentage coinsurance. As a result, the need for patient assistance will increase as higher-cost therapies are launched, and patients will increasingly have a voice in determining the value of cancer therapies.
Biosimilars and comparative effectiveness analyses have the potential to exert downward pressure through lowest-cost-alternative policies and, possibly, interchangeability status for biosimilars. Pharma should prepare strategies to either win at or differentiate from comparative effectiveness. Contingency planning should include contracting strategies designed to cope with price-based competition in the future.
Patricia Ensor, RPh, MBA, is SVP, Kantar Health
You must be a registered member of MMM to post a comment.

Email Newsletters

What does going "beyond the pill" actually mean? At MM&M's recent inaugural spring conference, audience members heard from real-world companies that are managing the organizational, technological, and promotional challenges inherent in this transition, such as partnering with health neophytes, harnessing technologies that allow deeper engagement with patients, and adopting a new commercial mindset to serve, not sell. Download here.

A wave of more effective anti-cancer drugs has set the oncology world on fire with enthusiasm. While many hail this as a new era, an equally vocal faction questions the money spent for the value gained. This medical and commercial trend report for marketers of anti-cancer modalities touches on many of the latest shifts that have expedited product launches and otherwise impacted promotion and reimbursement of these drugs. Click here.