Reprinted from SPECIALTY PHARMACY NEWS, a monthly newsletter designed to help health plans, PBMs, providers and employers contain costs and improve outcomes related to high-cost specialty products.
By Angela Maas, Managing Editor
May 2013 Volume 10 Issue 5
2012 saw some tremendous advances in drug development, particularly in oncology and orphan diseases, notes a recently released study by the IMS Institute for Healthcare Informatics. The report points out that spending on drugs and the utilization of health care services declined nationwide during the same period of time. As people are subject to higher out-of-pocket costs for health care services and medications, though, this could jeopardize their ability to take advantage of these breakthrough therapies.
Released this month, Declining Medicine Use and Costs: For Better or Worse? points out that last year Americans spent $325.8 billion on medications, which is real per-capita spending of $898 — $33 less than total spending in 2011. That translates into a 3.5% decrease on a real per-capita basis in total spending on medicines last year. “It shrunk by 1% on a nominal basis,” noted IMS’s Michael Kleinrock at a May 7 conference call to discuss the report. That, he said, “has never happened before. It’s a very big deal.” Kleinrock, the director of research development at the IMS Institute for Healthcare Informatics, explained that IMS has been “tracking overall sales [of medicines] since 1957,” and the information services company has “never seen a spending decline.”
The “main reason” for the decline in spending on drugs can be attributed to patent expirations, which represented a loss of $28.9 billion, he explained. Although there has been a gradual increase in patent losses over the past five years, “right now we’re at the deepest part of the patent cliff’s impact.”
Last year also was the second straight year that spending on health care services declined. In addition, “patients are encountering ever-higher” deductibles, copayments and coinsurance, Kleinrock pointed out.
On the surface, a decrease in spending on health care services could seem like a good thing. However, explained Kleinrock, “If patients don’t visit the doctor and they don’t use health care services as they should,…we may see worse outcomes for those patients overall.”
According to Kleinrock, the “significant reductions” in spending on drugs and use of health care services were “offset by new medications” that gained FDA approval in 2012. “It’s an amazing group of breakthroughs.”
He noted that the nine new cancer treatments were “the most in cancer in over a decade” (see chart, below). In addition, many of those therapies demonstrated “very impressive outcomes.” Kleinrock cited Erivedge (vismodegib) as one example, noting that the New England Journal of Medicine called it “the greatest advance in therapy yet seen for” basal cell carcinoma. A separate article in the June 7, 2012, issue noted that the drug had a 30% response rate among 33 people with metastatic basal cell carcinoma and a 43% response rate among 63 patients with locally advanced basal cell carcinoma, with 13 of those experiencing a complete response — “really good” rates, explained Kleinrock.
Also among the 28 new molecular entities that launched in 2012 were seven orphan drugs. Kalydeco (ivacaftor) “will significantly improve life expectancy” for a subset of people with cystic fibrosis, according to the report.
And another significant launch, said Kleinrock, was Xeljanz (tofacitinib), the first oral therapy for the treatment of rheumatoid arthritis. The drug is a Janus kinase (JAK) inhibitor and “the first of a new class of therapies for this indication,” notes the study.
The report cites the following as developments within the pharmaceutical space to keep an eye on:
· The FDA’s Breakthrough Therapy Designation: The agency can now give this designation to drugs still in clinical trials that “treat a serious or life-threatening disease or condition” and for which “preliminary clinical evidence indicates that the drug may indicate substantial improvement over existing therapies.” Kleinrock called this an “interesting precursor of the new decade,” noting that a “drug in Phase I could reach the market in three to five years rather than 10 to 15.” Of more than 30 applications, the FDA has approved about one-third for the designation, although none of them has launched yet.
· “Smart bomb” breast cancer drug Kadcyla (ado-trastuzumab emtansine): The FDA approved the drug in February for use in people with HER2-positive metastatic breast cancer who have received prior treatment (SPN 3/13, p. 11). It is able to target only those cells that express HER2 genes.
· Expected approvals in multiple sclerosis: The oral drug Tecfidera (dimethyl fumarate), approved in March (SPN 4/13, p. 1), “could deliver significant efficacy improvements over current standards of care for multiple sclerosis.” It is the first of an expected upcoming “wave” of treatments for the condition.
· All-oral hepatitis C treatment regimens: The study notes that the second half of 2014 should see the first all-oral regimen approved for genotype 1 hepatitis C, which represents about 70% of people with the virus. In addition, approvals later this year could include simeprevir, the first once-daily protease inhibitor, and sofosbuvir, the first nucleotide to treat hepatitis C.
View the report at www.theimsinstitute.org.
New Molecular Entities (NMEs) Launched in the U.S. 2003-2012
New Molecular Entities (NMEs) Launched in the U.S. 2003-2012
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SOURCE: IMS Institute for Healthcare Informatics, Declining Medicine Use and Costs: For Better or Worse?, released May 2013.
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