Should ICER Look at Transformative Therapies?

In early August, the Institute for Clinical and Economic Review (ICER) released a draft proposal of method adaptations to its value framework to be applied in the assessment of potential cures and other treatments that qualify as “single or short-term transformative therapies.” ICER states that while these proposed adaptations would not fundamentally alter ICER’s approach to value assessment, their intent would be to provide a reliable and transparent evaluation of novel breakthrough therapies, from the standpoint of uncertainty, value, and value-based pricing. As stated by Steven D Pearson, MD, MSc, president of ICER, in an official ICER press release (August 6, 2019), “many of these therapies are introduced with much higher levels of uncertainty about their long-term safety and effectiveness than standard treatments, and patients and insurers are being asked to pay extremely high prices upfront for the promise of long-term benefit.”

While ICER’s effort to stay ahead of the “break-through curve” should be commended, it is worth considering whether this unmet need is being fulfilled. For example, looking at the recent approval of two novel medications used to treat spinal muscular atrophy (SMA), we know that the most recently approved medication is a single dose infusion, which has been labeled as the single most expensive medication ever approved. The first medication—approved in late 2018—is an intrathecal injection every 4 months.

It is important to consider that SMA is a rare disease. The clinical trials were small and study populations were very narrow. Both medications were given breakthrough status by the Food and Drug Administration and the follow-up periods were 24-36 months. One trial was stopped early due to the interim results. These drugs are “transformative,” especially when symptoms are present in infants less than 6 months of age. While there is some benefit to mortality and motor impairment in children developing symptoms later in life, current methods to measure an impact to the quality of life are not able to come close to demonstrating cost-effectiveness.

The ICER evaluation for transformative therapies in SMA should almost come as no surprise. Simply stated, in all scenarios, neither medication met the standard quality-adjusted life year (QALY) cost-effectiveness threshold nor did they meet the modified QALY threshold for rare diseases. In all scenarios, neither medication met the cost-effective threshold using the live years (LY) gained analysis, which was utilized to provide a broader perspective of cost-effectiveness. The weakness of the two analyses is that the utility component of the QALY is either not sensitive enough to show an impact on the quality of life, or there is not enough data to be able to confidently project the extension of life. Even from the aspect of looking at the cost per LY gained, it was not clear how the life extension projections were determined.

In short, the data is too limited. Therapies that are deemed “transformative” often are released with little doubt of their clinical benefit because of the title “transformative.” These novel therapies will be expensive, and under the current value assessment framework (which is not likely to change) we will never see any cost-effective analysis meeting thresholds. The studies are few and small. In the end, if these therapies are truly “transformative” with few alternative treatment options, payers will have little option but to cover the treatment, even if for a very specific and selection population supported by limited data. Furthermore, it is worth mentioning that while the current “buzz” to pay for these therapies is value-base arrangements, we do not have the systems in place to execute a true value-based contract.

ICER should continue to refine the value-assessment framework, focusing on the “utility” portion of the equation, and more specifically on the quality of life impact. Additionally, ICER should focus the value-assessment in other areas that are cost consuming while avoiding the most obvious cost-effective treatment strategy (ie, costly chronic diseases and specialty medication therapeutic areas). These areas are where payers struggle to manage care and control costs. In the case of a rare diseases, payers have to provide coverage due to the lack of other treatment options.

For now, the QALY of transformative therapies is definitely not sensitive nor sophisticated enough to demonstrate any impact as a result of treatment. Thus, we may never see a transformative therapy demonstrating cost-effectiveness. With this thought in mind, are these therapies just simply priced too high?