Oncology Market Access & Pricing

Jun 15, 2015 - Jun 16, 2015, Boston

Meet the key stakeholders and benchmark with the leaders in Oncology commercialization

Clinical Pathways in Oncology

Danielle Barron reports on the increasing popularity of evidence-based clinical pathways & the implications for manufacturers.

The adoption of clinical pathways is not only growing, but will be a vital mechanism by which escalating cancer care costs can be contained.

Historically, clinical pathways in cancer care have been dismissed as “cookbook medicine” but the latest evidence suggests their use is growing and the approach may be set to revolutionize how the medical sphere, and society at large, view outcomes from cancer treatment in terms of quality and value.

eyeforpharma's recent whitepaper “The Future of the U.S. Oncology Market: Preparing for Healthcare 2.0” has highlighted how the variation in cost and standards of care in oncology is being addressed by the adoption of clinical pathways. The analysis advises that the adoption of these pathways is not only growing, but will be a vital mechanism by which escalating cancer care costs can be contained.

The autonomy of the medical oncologist is not necessarily under threat but the entire treatment journey is being evaluated in a bid to realize cost-savings as the move towards prudent clinical decision-making gains momentum. Experts say that this has the added value of improving consistency between treatment regimes, something that is particularly relevant for the multidisciplinary business of cancer care.

According to "The Future of the US Oncology Market", hospitals have typically operated with a strict division of activities; decisions impacting clinical care were exclusively made by clinicians.

As organizations seek to manage shrinking profit margins due to falling reimbursement rates, their ability to reduce costs has become even more critical – what was once considered off limits is now a legitimate and necessary target.

The whitepaper argues “only by addressing the clinical and cost implications of physician decision-making can clinicians and administrators maintain organizational growth and ensure future viability”.

How it works

A recent piece in Health Affairs (“Changing Physician Incentives For Cancer Care To Reward Better Patient Outcomes Instead Of Use Of More Costly Drugs”) looks at clinical pathways as an example of a strategy being tried to reward physicians for improving outcomes and reducing the total cost of cancer care.

Author Dr Lee Newcomer, Senior Vice President Oncology, Genetics and Women's Health for United Healthcare, argues that while more-sophisticated chemotherapy regimens have improved the outlook for cancer patients since the 1970s, the payment system for cancer chemotherapy has not changed during that time span.

Newcomer explains that this method requires oncologists to treat specific clinical conditions with predefined chemotherapy regimens, usually selected by a representative body of physicians.

If several regimens are deemed clinically equivalent, the least costly one is selected. If the patient has a medical contraindication to the chosen regimen, their treating oncologist can deviate from the pathway.

There are defined benefits for the oncologist who adheres to the pathway – Newcomer outlines the various rewards for compliant physicians, which may include “higher fee schedules, bonus programs, or other forms of incentives”.

The bottom line

Clinical pathways are ultimately employed to lower the drug costs of cancer therapy. Marcus Neubauer and co-authors report a 37% reduction in the drug costs for lung cancer patients using pathways developed by US Oncology, a national oncology management organization.

A 2014 paper in the American Journal of Managed Care (“Is Medicare Ready for Clinical Pathways”) outlines the exponential rise in the medical costs associated with cancer care and warns they are projected to rise much further, to more than $173 billion per year by 2020.

It points to a plethora of reasons; the greater use of specialty drugs, increased cancer prevalence due to an ageing population, as well as the treatment of cancer in costly acute hospitals. The variability in costs of care as well as practice is being addressed through the “evolution of oncology practice guidelines into oncology clinical pathways”, says Mehr.

In fact, the development and adoption of treatment guidelines is growing rapidly, in a bid to develop standard pathways as a way to ensure greater consistency as well as ensure the utilization of evidence-based medicine.

According to Mehr, the wide variation in treatment patterns and costs among oncologists has been “long documented and is apparent in many cancer types”.

In thyroid cancer, for example, one study found significant variation in multiple aspects of management, in central lymph node dissections, in pre-treatment scans before radioactive iodine treatment, and in all aspects of long-term thyroid cancer management.

“Another study found high variation among physicians in basic items, such as how often surveillance occurred after initial therapy in breast cancer,” says Mehr.

In addition to reducing the variability of treatment between facilities, guidelines and clinical pathways may also reduce overall costs by decreasing the use of less effective therapies.

Pathways in practice

Pathways are not a new approach – several vendors have been trialing and implementing clinical pathways for many years.

A 2013 survey found that 28% of health plans indicated that they currently utilize oncology clinical pathways, while another 50% indicated that they would do so within three years. According to McKesson, up to 1,500 oncologists are using its oncology pathways, and Aetna has been a customer for its clinical pathways for about seven years.

This popularity may be due to the fact that the treatment options listed by today’s practice guidelines are too broad. These guideline recommendations are not usually based on adequate evidence. Mehr points to a National Cancer Institute Bulletin which states that of the 16 possible ways to treat metastatic HER2-negative, estrogen-receptor negative breast cancer, “most of them will never be tested head-to-head to determine which are the most effective, least toxic, and least costly”.

A number of programs involving collaboration between pathway vendors and payers/providers have now begun to yield results in terms of value as well as outcomes.

A 2013 alliance between Cardinal Health Specialty Solutions and CareFirst BlueCross BlueShield was found to have helped reduce overall breast, lung, and colon cancer treatment costs by 15 per cent.

This decline in costs was primarily attributed to fewer emergency room visits, shorter hospital stays, increased use of generic drugs, and more appropriate use of chemotherapy.

Dr. Bruce Feinberg, Vice President and CMO of Cardinal Health Specialty Solutions.

“When implemented collaboratively, with physician input and buy-in, clinical pathways can create a new paradigm for the delivery of cancer care – one in which all stakeholders can win", outlines Dr Bruce Feinberg, Vice President and CMO of Cardinal Health Specialty Solutions in the eyeforpharma whitepaper.

This emphasis on value is becoming embedded in all facets of healthcare, and it has been well-documented that cancer care, previously “untouchable”, is not immune to this new reality.

Future Expansion

It is expected that these collaborative efforts will continue as physicians are increasingly employed by hospitals and healthcare systems.

The AJMC paper suggests that clinical pathways may expand to cover 25 per cent of the oncology market in 2015, up from about 10 per cent in 2010. As pathways increase in popularity, this will have practical implications for clinical practices.

“There’s recognition that practices will face administrative challenges if every payer works off a different clinical pathway type. Therefore, it would be preferable to have a common pathway format and approved approach. The biggest payer of all – the Centers for Medicare & Medicaid Services (CMS) – has not yet moved in this direction", states Stanton Mehr.

According to the "The Future of the US Oncology Market", recent evidence also suggests that broader considerations – beyond product efficacy and safety – will increasingly be factored into clinical pathways. Clinician representative organizations have begun to recognize the need to seek value when selecting treatment regimens for their patients.

New guidelines for metastatic prostate cancer from the American Society for Clinical Oncology indicated that clinicians needed to be conscious of cost and, significantly, tied cost to a broader consideration of quality of life, the paper adds.

A leader of the guidelines committee explained that “including quality of life data in the guideline helps people understand how the different treatments will make them feel.”

Implications for the pharma industry

The eyeforpharma whitepaper states that policy and common practice traditionally provided mostly unlimited access to drugs and biologics, mainly because highly active oncologics were only used for short periods of time.

Most analysts agree that in the future, evidence-based clinical pathways will continue to be used in a bid to control drug utilization.

“As a result, manufacturers must focus on the ability of their products to improve current treatment regimens, save costs, and improve outcomes when compared against less costly alternatives,” states the whitepaper.

The paper also outlines how providers are also starting to demand evidence of a product’s economic and clinical value.

“Moving forward, hospital administrators, who are under increased pressure to control costs and justify reimbursement rates, will rely on published evidence as well as the experience of their clinical teams to determine a product’s value,” it states.

Pathways create an incentive for pharmaceutical firms to demonstrate that their drugs have major advantages in outcomes or costs, compared to those of competitors, so the drugs will be included in a pathway. However, pathways do not allow real-time comparisons between competing regimens, according to Newcomer of United Healthcare.

There is now a broad consensus among all stakeholders that current model of payment for cancer care at all stages of treatment is not sustainable. The payment system for cancer drug therapy requires changes, says Newcomer, and he advises that payers and policy experts should carefully align any new payment system with the desired outcomes for cancer patients and society, with the aim of achieving the “best possible outcomes for the least amount of money”.

Indeed, clinical pathways address drug pricing in an indirect fashion. While these methods could exclude a drug from selection if it were ineffective, the approach does not compel manufacturers of effective drugs to lower their prices.

In addition, while physician incentives will increase buy-in from oncologists, these have no effect on individual premium drug prices.

The whitepaper asserts, however, that premium-priced innovative products can still achieve placement on formularies and inclusion in clinical pathways if real value has been demonstrated. For instance, despite the fact that Genentech’s Perjeta (pertuzumab) costs $180,000 per patient for a course of therapy covering an 18-month period, United Healthcare added the drug to its bundled price program based on positive clinical results.

Hence, the clinical pathway approach looks set to become even more widespread, as it attempts to strike the perfect balance between cost containment and optimal clinical outcomes for patients using efficacious therapies.

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Oncology Market Access & Pricing

Jun 15, 2015 - Jun 16, 2015, Boston

Meet the key stakeholders and benchmark with the leaders in Oncology commercialization