Personalized Medicine and Managed Care

Cincinnati—At a Contemporary Issues session at the AMCP meeting, speakers discussed aspects of personalized medicine (PM) that relate to managed care. The session was titled Personalized Medicine in Managed Care.

Diana I. Brixner, RPh, PharmD, professor and chair, department of pharmacotherapy, the University of Utah, Salt Lake City, and executive director, Pharmacotherapy Outcomes Research Center, discussed the link between prognosis, treatment response, and costs, and ways PM influences treatment decisions.

Dr. Brixner began by outlining current formulary structures and comparing those structures to future directions. Formularies today are driven by medication class, include a tiered system of copayment amounts, utilize step therapy, and manage the use of expensive medications with prior authorization requirements. Formularies tomorrow will emphasize value-based design, with accountable care organizations being reimbursed for efficacious treatments. There will be an emphasis on PM with targeted therapy utilizing a drug only if it will work and only where warranted. Companion diagnostics will be required for reimbursement, Dr. Brixner said.

The session continued with a presentation from Susan Garfield, DrPH, vice president of market access and healthcare, GfK Bridgehead, Wayland, Massachusetts. She began with the definition of PM from the President’s Council of Advisors on Science and Technology (September 2008): “Personalized medicine refers to the tailoring of medical treatment to the individual characteristics of each patient. It does not literally mean the creation of drugs or medical devices that are unique to a patient but rather the ability to classify individuals into subpopulations that differ in their susceptibility to a particular disease or their response to a specific treatment. Preventive or therapeutic interventions can then be concentrated on those who will benefit, sparing expense and side effects for those who will not.”

Dr. Garfield noted that health plans are taking steps to create pathways for PM although the process is evolving. Groups such as Medco are conducting internal evaluations to assess the cost and efficacy of utilizing drug/diagnostic combinations for PM. Some plans have begun to utilize PM and companion diagnostics to provide binary information to inform a therapy choice, she added.

She concluded by noting that moving forward, PM will clarify treatment pathways for some patients, while leaving others without clear pathways. This dichotomy will result in such questions as the development of coverage policies and formularies in scenarios where there is no single companion diagnostic to inform choice of treatment; whether payers should restrict coverage and preferred formulary status to drugs with FDA-approved companion or personalized diagnostics; and ways to cover interpretation of results and choice of treatment decision support.

The next speaker was Patricia A. Deverka, MD, MS, MBe, senior research director, Center of Medical Technology Policy (CMTP), Baltimore, Maryland. The mission of the CMTP is to “advance healthcare innovation and effectiveness by improving the quality, relevance, and efficiency of healthcare research,” Dr. Deverka said. The center focuses on methods, infrastructure, and policy projects to support the conduct of comparative effectiveness research.

She listed 4 concerns that need to be addressed by decision makers regarding PM tests: (1) analytic validity (does the test provide correct information?); (2) clinical validity (is there a significant association between the results of the test and clinical phenotype?); (3) clinical utility (does the test lead to improved patient outcomes compared with the alternative?); and (4) cost effectiveness (does the test lead to greater value as compared with the alternative?).

Citing possible reasons for inadequate evidence, Dr. Deverka noted that rapid changes in technology are not being matched by changes in the hierarchy of acceptable evidence. A diagnostic business model does not generate enough funds to pay for high-quality studies, she added. There is a lack of clarity about regulatory requirements and evidentiary standards for reimbursement, she said.

“Uncertain evidence of clinical utility has consequences for patients and the healthcare system,” she concluded.

The session concluded with a presentation from H. Eric Cannon, PharmD, chief of pharmacy, SelectHealth. His presentation focused on pharmacogenomics, which he defined as the general study of all of the many different genes that determine drug behavior.

He cited the July 14, 2011 guidance on companion diagnostics from the FDA. The guidance defines in vitro companion diagnostic device as an in vitro diagnostic device (IVD) that is able to supply essential information allowing a corresponding therapy to be used safely and effectively. Use of an IVD aids in identifying a person likely to benefit; identifying a person at risk for serious reactions; and monitoring a person’s response to therapy.

Dr. Cannon cited barriers to companion diagnostics. For developers, barriers include regulatory approval, reimbursement issues, efficacy, and comparative clinical effectiveness of drugs. For payers, barriers include a lack of evidence supporting the efficacy of a companion diagnostic, the cost of the companion diagnostic, and the comparative clinical effectiveness of drugs. Finally, for patients, barriers include a lack of insurance coverage for the drug or the companion diagnostic and a high rate of cost-sharing.

He concluded by noting implications for managed care, including an increased need for coordination between medical technology and pharmacy. The next steps for managed care include (1) increasing coordination with care management and medical technology; (2) aligning reimbursement of testing and specialty testing; and (3) creating an environment that allows for advancement of technology, Dr. Cannon commented.