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What’s trending in today’s global oncology landscape?
Simon-Kucher NYC Life Science Forum 2014
October 17, 2014
Lisa Sun …and the Simon-Kucher LS team New York office
17 State Street, 37th Floor New York, NY 10004, USA Tel. +1 212 537 0730 [email protected]
www.simon-kucher.com
Today’s topic: Oncology trends in the ex-US markets with focus on the EU 2008 19.4 billion
+12%
2013 21.8 billion
EU-5
2008 30.1 billion
USA
2013
37.2 billion
+20%
% relative discount of EU ex-manu. prices to the US WAC for selected oncology therapies* -25% -37% -22% -35%
Source: Simon-Kucher & Partners 2014 *Zelboraf, Yervoy, Zytiga, Jevtana, Xalkori, Inlyta, Halaven; Simon-Kucher Healthcare Insights 2014 Spring . **IMS MIDAS, MAT Sep 2013; Oncology includes therapeutic treatments as well as radiotherapy and immunotherapies.
Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 2
Today’s agenda
What’s trending in today’s …
Oncology market landscape
Oncology pricing & market access (EU focus) Team discussion
Future oncology P&MA prognosis and strategic considerations
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 3
Trending in oncology market landscape Market overview: Recent and future shift in the oncology space Evolution in the oncology space
“At the current rate, the
cost of cancer care
is expected to increase from from
$125B in 2010
to
$173B by 2020
– a 39% increase.” – ASCO, 2014*
Avastin docetaxel
Chemotherapy Targeted therapy Past
Xalkori
RxDx
Perjeta Herceptin Keytruda
Immunotherapy Today Combination therapy Near future Recent past
Recent headlines
Source: Simon-Kucher & Partners 2014. Seeking alpha; *”The pathway to Value and Innovation,” – ASCO daily news (May 31, 2014) ; www.reuters.com
Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 4
Trending in oncology market landscape Biomarkers remain at the forefront of oncology Rapid growth in Rx/Dx development in oncology (Selected examples)
Metastatic breast cancer Herceptin Perjeta Advanced melanoma Zelboraf Tafinlar Non-small cell lung cancer Xalkori Iressa
Why biomarkers?
Value-add of biomarkers:
Increased efficacy in biomarker positive patients
Typically higher value perception by both payers and KOLs
Resulting increase in both likelihood and speed of regulatory approval and funding/reimbursement decisions
Perceived potential to lower budget impact by payers (pay for performance, not for trial & error)
Often address unmet needs even in crowded oncology indications
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 5
Trending in oncology market landscape A recent success story: Perjeta in combination with Herceptin and docetaxel Perjeta (pertuzumab, Roche) in metastatic breast cancer Approved for use in combination with Herceptin (trastuzumab) and docetaxel 1 st indication: 1st line HER2+ mBC
EM June 2012 April 2013
2 nd indication: Neo-adjuvant breast cancer
FD September 2013
Future
: Expected future filing for Perjeta (pertuzumab) and Kadcyla (trastuzumab emtansine) combination
Total treatment cost* Herceptin (trastuzumab) + Perjeta (pertuzumab) ~$210,000 ~$160,000 Key implications
Targeting a sub-population with high unmet need creates significant recognized value
Highly innovative and effective combination therapies are able to secure market access at premium pricing
[Perjeta’s] survival improvement of nearly 16 months is unprecedented among studies of metastatic breast cancer - Lead researcher Sandra Swain at ESMO
Increased cost pressure and budgetary constraints are of concern
Perjeta Herceptin
However, Herceptin’s LOE may help mitigate pricing pressure on Perjeta
Source: Simon-Kucher & Partners 2014. FDA.gov; EMA websites; clinical trial.gov; www.reuters.com; PriceRx. *Weighted average cost in the US, average of EU-3 ex-manu prices (FR, DE, UK). Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 6
Today’s agenda
What’s trending in today’s …
Oncology market landscape
Oncology pricing & market access (EU focus)
Team discussion
Future oncology P&MA prognosis and strategic considerations
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 7
What’s trending in today’s oncology market access?
Increased payer emphasis on demonstrating value: Hard evidence requirements & comparative data Greater market access hurdles: Delay in reimbursement and increasingly constrained budgets Evolving contracting: Pricing negotiations with increased focus on net pricing and financial schemes
Source: Simon-Kucher & Partners 2014.
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Trending in P&MA #1: Emphasis on hard evidence Trending in oncology P&MA: Increased payer emphasis on hard evidence requirements and comparative data Discounting
Understanding the varying payer expectations on the evidence required to demonstrate value is critical for favorable market access Failing to meet the evidence requirement has often led to poor reimbursement outcomes and/or conditional approval
Core value drivers Secondary value drivers in oncology Peripheral value drivers in oncology Patient compliance services
Source: Simon-Kucher & Partners 2014. FDA.gov; EMA websites; clinical trial.gov; www.reuters.com
Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 9
Trending in P&MA #1: Emphasis on hard evidence Trending in Germany: OS and subgroup analysis are the key drivers behind benefit assessment
Germany
OS is a key driver behind achieving additional benefit in the benefit assessment…
Available data at launch Target indication Select recent oncology drugs for which an early benefit evaluation was conducted Jevtana
(cabazitaxel)
Zytiga
(abiraterone)
Halaven
(eribulin)
Yervoy
(ipilimumab)
Zelboraf
(vemurafenib)
Xalkori
(crizotinib)
Adcetris
(brentuximab) Prostate cancer Prostate cancer Breast cancer Melanoma Melanoma NSCLC Hodgkin’s lymphoma
Mean OS
no data
Symptoms HRQoL
no data no data no data no data Outcome: Additional benefit no data …and detailed evaluation by subgroups are common
Product Subgroup 1 Perjeta
(pertuzumab) Patients with visceral metastases
Xalkori
(crizotinib) Patients where chemotherapy is indicated (ECOG performance status 0,1 and 2)
Jevtana
(cabazitaxel)
Zytiga
(abiraterone) Patients with docetaxel re-treatment is not an option Source: Simon-Kucher & Partners 2014.
Considerable benefit Considerable benefit Minor benefit Considerable benefit
Subgroup 2
Patients with non-visceral metastasis or patients with locally recurrent, inoperable breast cancer Patients where chemotherapy is not indicted (ECOG performance status of 4,2 and possibly 2) Patients where docetaxel re-treatment is an option Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014
No benefit No benefit No benefit No benefit
10
Trending in P&MA #1: Emphasis on hard evidence Trending in the UK and France: Preliminary Phase 2 and lack of comparative trials are less accepted for approval
Manufacturers penalized for submitting with Phase II and ORR data only The TC can penalize submissions that are lacking in comparative data when determining ASMR Cancer drug fund assessment:
Major I Important Moderate II III Minor IV In the absence of a positive NICE appraisal, the CDF prioritization score card
looks at OS, PFS, and QoL data in addition to the toxicity, unmet need, and cost per QALY (if available)
Lack of Phase III and OS data is explicitly mentioned as a negative
Source: Simon-Kucher & Partners 2014.
Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014
None V Jevtana (cabazitaxel) –advanced prostate cancer
2011:
Received an initial ASMR rating of IV, which did not lead to T2A exclusion
2013:
data Achieved ASMR III and T2A exclusion list by re-filing with new
Vectibix (panitumumab) – metastatic colorectal cancer
2012:
In the absence of a comparative study vs. Eribitux, Vectibix does not provide an improvement in actual benefit in wild type KRAS mCC 11
Trending in P&MA #2: Greater market access hurdles Trending in the EU-3: Majority of recent innovative oncologic launches have faced lengthy P&MA negotiations EU-3 case study: Months from EMA approval to country P&R agreement*
Spain Italy France Agreement not reached yet Source: Simon-Kucher & Partnres 2014. *As of October, 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 12
Trending in P&MA #2: Greater market access hurdles Trending in the EU: Countries are employing a range of controls in response to high budgetary pressure 2014: Extension of Cancer Drug Fund (CDF) until 2016:
CDF provides an additional £200m/year for oncology drug access UK
Elimination of the “add-on” tariff in 2015:
under development but details are unknown New system is
2014: Product-specific expenditure cap:
A new tool for national payers to control budgets Increased budgetary constraint Future impact unknown
Note: Italy and Spain already place high emphasis on budget impact. In France, price volume agreements (PVA) are also very common.
France
2012: CEESP HE evaluation:
HE data has become a key part of P&MA evaluations (mandatory step when ASMR I, II, III is requested AND potential significant impact on Social Security expenses is expected) Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 13
Trending in P&MA #2: Greater market access hurdles Trending in P&MA: Tightening budgetary constraint may create additional hurdles for diagnostic funding in some markets
No uniform process regarding the reimbursement of diagnostic tests in oncology across markets
Current example of oncology companion diagnostics (CDx) Budget systems Alternative access routes Tariff systems
new system
UK Spain
(old)
Spain
(current)
France
(current)
France
(old)
Australia Germany Italy Brazil
Diagnostic tests are funded out of general hospital or regional health authority budgets Funding through alternative institutions National tariffs for diagnostic tests Example: Italy cuts costs for diagnostics
Italy
“Diagnostic procedures performed unnecessarily to provide additional legal backing for medical decisions are costing Italy’s public health system some €10 billion per year according the a report by [Italy’s] Inquires Committee… the Committee assesses the impact of dissuading healthcare
providers from offering certain services
.” -
Clinica, February 2013 Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 14
Trending in P&MA #3: Evolving contracting Trending in Spain: Contracting has become relevant for pricing and access decisions on multiple-levels Contracting on multiple-levels leads to larger gap between list and net prices Before Now List ex-manu
Spain
National access Regional access
Common for high cost oncology drugs with uncertain efficacy
Local / Hospital Net ex manu
National rebate Rebate to regions Rebate to local payers
National access Dual pricing Trending in Spain: New instruments at the national level for P&MA negotiations Almost half of drugs affected by dual-pricing are oncologic launches Introduction of dual pricing in April 2012:
Additional funding
confidential discounts
are expected to be negotiated at the national level in return for
44% Oncology 56% Other
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 15
Trending in P&MA #3: Evolving contracting Trending in Canada: Provincial P&MA negotiations are rapidly transitioning to a collective negotiation model
Canada
Negotiation on a one-by-one basis with individual provinces Individual provinces typically preferred direct discounts
New “pan-Canadian” approach with multi-province negotiations
Introduction of the pan-Canadian Purchasing Alliance (pCPA)
Basis for pCPA:
~2013 leverage collective purchasing power of provincial drug plans (except QC) to negotiate lower prices for prescription drugs Created in 2010 but sporadic implementation until Recently, it has become the de facto expectation for most drugs reviewed by pCODR, especially innovative oncology therapies Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 16
Trending in P&MA #3: Evolving contracting Trending in the UK: Recently, only discount-related patient access schemes have been accepted by NICE In 2013, half of the drugs with approved patient access schemes (PAS) are in oncology Past 2007/2008 Decline in response-based schemes are the standard for NICE Response schemes Rebates Discount schemes
Autoimmune diseases (11) Other (7) Number of drugs with approved PAS (n = 36)
Discount scheme Oncology (n = 18) n = 13
Dose cap/free stock Single fixed price
2013 Now
0% Rebate All PAS other than discount schemes were set up before July 2010
Breakdown of the types of PAS*
100% Response scheme Number of oncology drugs with approved PAS (n = 18*) Source: Simon-Kucher & Partners 2014. NICE; ; * at the date of TA: Technology appraisal; ** http://www.nice.org.uk/aboutnice/howwework/paslu/ Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 17
Trending in P&MA #3: Evolving contracting Trending in Italy: Oncology drugs are subject to both financial and performance-based contracts Most recently launched oncology drugs were subject access schemes leading to substantial discounts in price
Patient access schemes need to be tailored to each individual drug – there is no “one-size fits all”-solution
Recent case studies from oncology Drug Indication Patient access scheme Halaven (eribulin) Jevtana (cabazitaxel) Arzerra (ofatumumab) Yondelis (trabectedin) Yervoy (ipilimumab)
Metastatic breast cancer Prostate cancer
Risk-sharing agreement Budget cap of €15 million
Chronic lymphocytic leukaemia Soft tissue sarcoma Melanoma
Cost-sharing agreement
(50% reimbursed only)
Undisclosed discount to NHS Payment-by-results
(payback of first two cycles if permanently discontinued)
Budget cap
dose) of €30m for first year, €50m for the second year
Payment-by-results
scheme (100% payback if treatment discontinued before the third
Undisclosed discount to NHS EMA approval
3/17/2011
Time between EMA approval and market access in Italy P&R agreement
9 months 05/01/2012 3/17/2011 4/19/2010 9/17/2007 7/13/2011 9 months Approx. 1 year Approx. 1.5 years Approx. 1.5 years 08/12/2011 14/06/2011 11/02/2009 22/02/2013 Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 18
Today’s agenda
What’s trending in today’s …
Oncology market landscape
Oncology pricing & market access (EU focus)
Team discussion
Future oncology P&MA prognosis and strategic considerations
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 19
Key consideration: Development of P&MA strategy will become increasingly complex Discussion: Future oncology P&MA prognosis Future P&MA strategy in oncology Key factors behind oncology P&MA
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 20
Discussion: Future oncology P&MA prognosis Key consideration: Launch order optimization becomes critical to ensure future pricing sustainability A prioritization of the indications helps to derive the optimal launch / commercialization strategy Assess payer willingness-to-pay by indication Optimizing launch order* Oncology indication 1 1 Indication 1 Oncology indication 3 2 Indication 3 Oncology indication 2 3
Low Market attractiveness High Indication expansion in the order of descending price potential maximizes payer willingness-to-pay at all times
Indication 2
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 21
Discussion: Future oncology P&MA prognosis Key consideration: Increasing emphasis on incremental value add over current options will lead to higher focus on biomarkers Evaluation of biomarker opportunity
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 22
Additional group discussion points
Thank you!
Source: Simon-Kucher & Partners 2014. Simon-Kucher NYC Life Science Forum - What’s trending in today’s global oncology landscape? - October 17, 2014 23
Thank You !
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