Express Scripts seeks pay-for-performance deals for cancer drugs: report

Express Scripts chief medical officer Steve Miller said that the pharmacy benefit manager is targeting deals with drugmakers that link the price of cancer medicines to how well they work against different tumour types, The Wall Street Journal reported. "One of the big frustrations has always been people paying top dollar for drugs that aren't always giving them the best response," Miller remarked, adding "if pharma is truly sincere about wanting value-based reimbursement, we now have the sophistication to do that."

Steven Pearson, president of the Institute for Clinical and Economic Review, commented that drug pricing has been "very hard for the payers to do anything about." However, he said "now they're starting to think very hard about it, to look for practical ways to have more of an influence on pricing." Earlier this year, Express Scripts released a report showing that prescription drug spending in the US climbed 13.1 percent in 2014, the highest since 2003.

Miller highlighted Roche and Astellas' Tarceva (erlotinib), which has demonstrated a smaller benefit in pancreatic cancer than in lung cancer, with survival advantages in the two diseases of less than two weeks and about 3.5 months, respectively. Insurers currently pay the same per-unit rate regardless of the tumour type, but Miller suggested that under the new "indication-specific pricing" model, the per-tablet cost of Tarceva would be lower in pancreatic cancer.

A spokeswoman for Roche's Genentech unit noted that Tarceva is rarely used to treat pancreatic cancer as other drugs are now approved for the disease. The spokeswoman indicated that the company currently has indication-specific pricing for the drug in Italy and would welcome such a system in the US. However, she suggested that there are challenges in the US, such as fragmented patient-record systems.

The Wall Street Journal noted that as pay-for-performance deals often involve tracking outcomes, their cost and complexity can offset the benefits. "They're very data intensive to administer and track," commented Larry Blandford, executive vice president at consulting firm Precision for Medicine.

Although Miller didn't give examples of other drugs being targeted for indication-specific pricing, he noted that Express Scripts has begun approaching drugmakers about the deals, which could go into effect next year.

For related information on drug pricing, see Trends and Innovations in Drug Pricing and Payer Perspectives on Risk Sharing Deals.

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