NEW YORK (GenomeWeb) – A health economic study sponsored by Biodesix has found that the company's Veristrat lung cancer test could potentially decrease patient treatment costs.
Published this week in the journal Lung Cancer, the study found that using Veristrat to guide patient therapy in cases of advanced non-small cell lung cancer decreased the total lifetime direct medical cost per patient by $135.
As the study authors noted, the cost savings stemmed from a decrease in spending on drugs, as Veristrat identified a number of patients who were poor candidates for Genentech's EGFR inhibitor Tarceva (erlotinib) and were switched to less expensive chemotherapy regimes.
Per patient, savings in drug spending totaled $4,098. This figure was offset by the cost of the Veristrat test itself ($3,260), and increased surveillance ($137) and management of adverse effects ($567) stemming from the improved overall survival of patients whose therapy was guided using Veristrat and the increased amount of adverse effects from chemotherapy as opposed to erlotinib.
The study was an extended analysis of the PROSE study, a prospective clinical trial of Veristrat that examined whether the test was able to identify NSCLC patients likely to respond well to treatment with erlotinib in the second-line setting.
That study found that patients classified by the test as Veristrat "poor" fared significantly worse on erlotinib than chemotherapy, with the erlotinib-treated group showing median overall survival of three months compared to six months for the chemotherapy-treated group.
While the $135 in savings provided by Veristrat in the Lung Cancer study is a relatively small fraction of the roughly $32,000 overall treatment cost per patient, the significant savings in drug spending offered by the test demonstrate its potential value to the health care system, said John Hornberger, a Stanford University researcher and senior author on the paper.
He told GenomeWeb that the $4,098 per-patient savings in drug spending would serve as a starting point that Biodesix could use in negotiations with healthcare systems and payors over coverage and pricing of the test.
"There is a standard negotiation that goes on between these entities and the [test] manufacturer – how much of [the savings] should go to the [manufacturer], and how much should go to the payor," he said. "That's going to be a standard negotiation, not an academic exercise. So they will look at the $4,000 and sit down with their contract people and say, 'What do you think is a fair rate for that?'"
Hornberger added that with the evolution of the healthcare system under the Affordable Care Act, healthcare providers have more incentives than in the past to reduce spending within their networks, which, he noted, has made them more attentive to cost savings such as those that Veristrat provided in the Lung Cancer study.
"Before the [ACA] it was largely a pay-for-service world and the healthcare systems were mostly hospital systems that were rewarded for higher volumes of care, more ER services, [and] more hospitalization services," he said.
Moving forward, however, these organizations will be at greater risk financially, "and in this environment physicians and provider networks are trying to figure out how they can provide more efficient care," Hornberger said.
Finding tests that do provide cost offsets, however, remains a challenge, he noted. "I've talked to dozens of these [healthcare organizations], and they are frustrated that they are still using technologies that don't do any good whatsoever," he said.
Given this landscape, Biodesix hopes the savings demonstrated in the Lung Cancer study will help Veristrat gain traction in the marketplace.
"This study is the next step in building our data story," said Robin Harper Cowie, Biodesix's vice president of reimbursement and health economics. "This is another piece of that package that helps us show [Veristrat] has a positive impact on patients as well as the healthcare system. We'll continue to roll this out with all of our payors and in our different conversations about gaining adoption for Veristrat."
Designed to identify NSCLC patients likely to respond to chemotherapy or EGFR inhibitors like Tarceva, Veristrat is a blood-based proteomic test run on a MALDI mass spec platform. The test is currently covered by Medicare and Blue Cross Blue Shield affiliate Highmark, which, between them, total roughly 50 million covered lives, Harper Cowie said. She added that the company is currently negotiating several additional coverage deals that would bring the total of covered lives for the test into the 55 million to 60 million range.
Discussing the Lung Cancer results, Harper Cowie suggested that the demonstrated savings were notable in that, unlike many molecular tests, Veristrat is not intended to help physicians avoid unnecessary treatment so much as to help them to choose between two different treatments.
"In this study, it's selecting between two different treatment options – either erlotinib or chemotherapy," she told GenomeWeb. "There isn't a group that's not getting a treatment option. So I think the fact that there are significant cost offsets even with all of the patients receiving some sort of treatment, that's important."
The study authors noted that, although it was not used for this purpose in the Lung Cancer paper, Veristrat could be used to guide patients unlikely to respond to further treatment to hospice care.
Erlotinib is not recommended for patients who are identified as poor candidates by Veristrat and have progressed through multiple lines of chemotherapy, they wrote, adding that if such patients were guided to hospice care based on a poor Veristrat score, "this would reduce the use of active treatments and thus lessen the related costs."
By excluding hospice care as an option, this analysis likely overestimated the total cost with the use of the [Veristrat] test," the authors added.