U.S. Physician and Payer Forum

August 2013

Impact of Payer-Imposed Strategies on Market Access in NSCLC and Prostate Cancer: Clinical Pathways, Bundled Payments, and Accountable Care Organization Contracting

Introduction:

The non-small-cell lung cancer (NSCLC) and prostate cancer drug markets are already crowded with generics and novel branded agents jockeying for position in the sequence of treatment, but developers continue to pursue new products that could meet unmet needs in these two common, life-threatening cancers. In both indications, generic versions are available for traditional mainstay therapies: platinum-based chemotherapy agents such as carboplatin and cytotoxics such as paclitaxel in NSCLC, and hormonal drugs such as leuprolide and cytotoxics such as docetaxel in prostate cancer. However, an array of new drugs have been approved since 2010, and oncologists have quickly adopted several of them, including the alternative cytotoxic Eli Lilly’s Alimta (pemetrexed) in NSCLC and the novel hormonal drug Johnson & Johnson’s Zytiga (abiraterone) in prostate cancer. New compounds that target specific molecular pathways also hold promise for the treatment of niche populations with particular genetic traits in lung cancer. That said, the use of novel, premium-priced therapies is under growing pressure from payers and provider groups whose compensation is increasingly tied to compliance with cost-control measures. At the same time, drug development costs may rise with the need for multiple clinical trials to demonstrate competitive value in each patient subgroup. Meanwhile, patent expirations are triggering sudden revenue drops as payer cost-control programs push generic prescribing.

Key products in the oncology market include the following:

- Eli Lilly’s Alimta (pemetrexed), an alternative cytotoxic drug that was approved in 2008 for the treatment of non-squamous-cell NSCLC in combination with a platinum agent and in 2009 was approved as a maintenance monotherapy in second-line treatment.

- Pfizer’s Xalkori (crizotinib), which targets an ALK gene translocation and was approved in 2011 as a monotherapy in all treatment lines for patients with non-squamous-cell NSCLC who test positive for the ALK variation.

- Johnson & Johnson’s novel hormonal agent Zytiga (abiraterone), an orally administered, irreversible CYP17 inhibitor approved in 2011, in combination with prednisone, for docetaxel-pretreated metastatic castrate-resistant prostate cancer.

- Astellas’s novel hormonal agent Xtandi (enzalutamide), an androgen receptor signaling inhibitor approved in 2012 for the treatment of docetaxel-pretreated metastatic castrate-resistant prostate cancer.

In this report, we explore the use, reception, and pathway status of these key current and recently approved cancer therapies across multiple cancer populations in a survey of 101 oncologists and 41 managed care organization (MCO) pharmacy and medical directors. We also gauge payer and physician outlook toward two late-stage emerging therapies: Boehringer Ingelheim’s Giltotrif (afatinib) and Algeta/Bayer HealthCare’s Xofigo (radium-223). By exploring the attitudes and expectations of prescribers and payers toward current, recently approved, and emerging cancer therapies, stakeholders can gain an understanding of the treatment paradigm and the changing reimbursement climate for oncology.

Questions Answered in This Report:

  *   How does the use of select NSCLC and prostate cancer drugs vary as physicians and MCOs create and implement clinical pathway programs (CPPs)? What metrics determine whether novel and emerging therapies are included in pathways for specific patient populations and in successive lines of treatment?

  *   How does the adoption of clinical pathways change the mechanisms of reimbursement for prescribers, and what incentives are offered to oncologists to induce compliance with pathway designs? How influential are the incentives offered through CPPs, accountable care organizations (ACOs), and bundled payment arrangements?

  *   How have physicians incorporated or how will they incorporate Alimta, Xalkori, Zytiga, and Xtandi into clinical practice? How will CPPs designed by oncologists and by MCOs impact uptake? Will ACOs and bundled payment arrangements reinforce or temper that impact for specific drugs?

  *   How do physicians expect to incorporate two emerging agents, Boehringer Ingelheim’s Giltotrif (afatinib) and Algeta/Bayer HealthCare’s Xofigo (radium-223), into their prescribing practices? What restrictions will MCOs impose as they create clinical pathways, contract with ACOs, and reimburse through bundled payments? What does physician and payer receptivity to these emerging therapies imply for drug developers hoping to enter the oncology space?

Scope:

Each of these strategies – clinical pathways, ACO contracting, and the use of bundled payments – stand to benefit or hamper specific oncology brands. A previous report studying the role of clinical pathways and ACOs in breast and colorectal cancer pointed to sharp changes in market access parameters for many therapies, and similar issues are likely to emerge from this focus on NSCLC and prostate cancer.

Markets covered: United States.

Primary research: 101 oncologists, 41 MCO pharmacy/medical directors.

Epidemiology: Nonsquamous small-cell lung cancer, squamous small cell lung cancer, biochemical recurrent (hormone sensitive) prostate cancer, non-metastatic castrate-resistant prostate cancer, and metastatic castrate-resistant prostate cancer.

Population segments: Our data and analyses are segmented by the following cancer populations: populations within NSCLC (NSQ stage IV and SQ Stage IV) biochemical recurrent (hormone sensitive) prostate cancer, non-metastatic castrate-resistant prostate cancer, and metastatic castrate-resistant prostate cancer.


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