Although studies looking at the potential cost-effectiveness of pharmacogenomics may help guide the development of drug-diagnostic combinations and speed their adoption in the clinic — and might prove useful to payors seeking lower prices — there are few of them, and the existing research only covers a small number of conditions, according to a meta-study examining the available research.
When it comes to pharmacogenomics, and the ways in which it may affect drug and diagnostic discovery and development, there is a relative “dearth” of cost-effectiveness analysis, wrote Phillips and co-author Stephanie Van Bebber, a project director and analyst at UCSF. Despite the economic impact these studies may have on drug and diagnostics companies, reimbursement agencies, and even clinicians, the youth of pharmacogenomics is at least partly to blame, according to Phillips and Van Bebber.
“There are few clinical applications of pharmacogenomics that are currently very widely used,” said study author Kathryn Phillips, a professor of health economics and health services research and director of the Program in Pharmacogenomics and Population Screening at the University of California at San Francisco. “Until we demonstrate that it could have value, people are going to be reluctant to pursue it.”
Their study is scheduled to appear in the December issue of the journal Pharmacogenomics.
Cost-effectiveness analysis takes into account both monetary and quality-of-life factors, in accordance with Cost-Effectiveness in Health and Medicine, a standard US Public Health Service text by Marthe Gold of the City University of New York School of Medicine, and others. After finding nearly 650 articles that met broad search criteria, and after reviewing 50 of those, Phillips and Van Bebber found only 11 studies that met their criteria.
To be included in the meta-analysis, studies had to be true cost-effectiveness analyses that compared a pharmacogenomic treatment strategy with an alternative strategy, and presented a defined, minimum amount of data.
Studies were excluded from the meta-analysis if the strategies that were evaluated lacked information useful to making immediate prescribing decisions.
Such studies include those that look at disease-susceptibility genotyping, because the US Food and Drug Administration does not require this kind of research for so-called theranostic development. Plus, these kinds of analyses conducted in-house by drug or diagnostic companies are likely to be proprietary, the authors wrote.
Illustrating the paucity of cost-effectiveness research, the authors noted that Herceptin, the pharmacogenomic poster-child, has only one such study devoted to it fitting their standards. Moreover, this study produced equivocal results — that is, varying basic assumptions made by its authors changed its evaluated cost effectiveness from favorable to unfavorable — the authors added.
“Given all the focus now on reducing cost, you would’ve thought people would have had more scrutiny of [the drug],” said Phillips.
The authors also found no “full analyses” dealing with CYP450 testing, nor of the lung cancer drug Iressa, or other targeted therapies, according to the paper.
Among the 11 articles meeting the researchers’ criteria, there was little diversity in the subject of study: four studies involved atherosclerosis (and warfarin, specifically), three involved cancer, three involved viral infections, and five of the studies involved the Factor V Leiden mutation.
The Effects of Cost- Effectiveness Studies
An understanding of cost effectiveness may help companies differentiate a pharmacogenomics approach from the “blockbuster” strategy of drug development, Christopher Webster, the director of regulatory strategy and intelligence at Millennium Pharmaceuticals told Pharmacogenomics Reporter. “Companies will be looking to see, ‘If we were to develop a drug that focused on a particular pathway, but might have applications in two or three label indications … [we] might still have a blockbuster drug in financial terms,’” even though the drug is treating multiple indications, he said.
Interest in cost effectiveness is shared by payors. “One of the big ifs has to be — even if we have the product out there, would payors necessarily pay for it?” said Webster.
“Payors may take a different view” of reimbursement and coverage from that taken by a pharmaceutical company as it decided whether or not to develop a candidate, Webster said.
The impact of pharmacogenomic cost-effectiveness studies on the pharmaceutical marketplace also depends on the extent payors and providers factor that information into decision making. Assuming they take it very seriously, a poor review would “limit substantially the utilization of the innovation,” said Joe DiMasi, director of economic analysis at the Tufts University Center for the Study of Drug Development.
As the situation stands, cost-effectiveness studies of non-pharmacogenomic drugs are “in the mix with regard to managed care,” though they may not be widely used by payors throughout the industry, said DiMasi.
“What that sort of analysis could do is help them negotiate prices,” depending on how favorable payors judge the analysis, DiMasi said.
Similarly, since payors would likely use cost-effectiveness studies, there is the possibility that cost-effectiveness studies might force some companies to scuttle a drug or diagnostic candidate, said Janice Reichert, a senior research fellow at the Tufts University Center for the Study of Drug Development.
Smaller drug and diagnostic companies will have invested millions of dollars on their first candidate compound, but a study showing that that candidate has a poor cost-effectiveness profile could bankrupt that firm, said Reichert.
There are many examples of expensive drugs, said Phillips. But the important component of these cost-effectiveness studies is their use as a guide for developers, she said. “The idea is to look at these things before they get widely disseminated,” she added.
About five years ago, Tufts’ DiMasi conducted a survey of the use of cost-effectiveness studies by major pharmaceutical companies to guide drug development. “It showed a significant interest in growth in that area within those companies, and an increasing role for those analyses in their ‘go, no-go’ decisions,” he said.
Industry, it seems, has been busy enough with the science and regulatory issues surrounding the use of genomics in drug treatment. “It’s only at this point that we’re getting into the whole question of cost-effectiveness and whether it makes sense [economically] to develop drugs and diagnostics,” said Webster.
Part II will appear next week.