Products approved on an accelerated basis by FDA in 2009 through 2019 accounted for an inordinate amount of commerical health plan and enrollee out-of-pocket spending in 2019, a study shows. “Payers should consider linking reimbursement to the clinical benefit of each accelerated approval product-indication pair,” write the authors. “Such an approach would not only incentivize manufacturers to complete postmarketing studies to verify clinical benefit and establish higher reimbursement rates, but also limit health plan and enrollee expenditures on accelerated approval product-indication pairs with low or uncertain therapeutic value.”
Product-indication pairs granted accelerated approval from Jan. 2009 to Dec. 2019 were identified using FDA reports. These were categorized as converted to full approval based on clinical end points or on surrogate end points, and not yet converted to full approval with postmarketing studies within FDA deadlines or outside FDA deadlines. Outpatient and prescription drug claims in the 2019 MarketScan Commercial Claims and Encounters database were examined to determine the cost of product-indication pairs and identify diagnostic codes matching the approved indication. Total health plan and enrollee spending was estimated and extrapolated to all U.S. employer-sponsored insurance (ESI) using Kaiser Family Foundation health insurance coverage data.
The authors report these results: “Commercial health plan spending on 93 product-indication pairs totaled $1.3 billion in 2019, which when extrapolated to all US ESI plans, equaled $9.0 billion. Health plans spent more than double on product-indication pairs converted to full approval based on surrogate end points than on those based on clinical end points. Health plan spending on product-indication pairs not yet converted to full approval equaled $261.9 million ($1.9 billion for all US ESI plans), of which 69% was attributed to those with postmarketing studies within FDA deadlines.
“Out-of-pocket spending totaled $17.5 million, or $125.5 million for all US ESI enrollees. Less than one-fifth of enrollee spending was on product-indication pairs converted to full approval based on clinical end points. Of the $5.9 million ($42.2 million for all US ESI enrollees) spent on product-indication pairs not yet converted to full approval, 46% was attributed to those with postmarketing studies within FDA deadlines.”
Editorial: “Accelerated approval is not associated with greater odds of being rated as having high therapeutic value,” editorialists write. Ideas suggested in the literature for improving current practice and increasing the value of drug spending include having lower reimbursement rates for products until they attain full FDA approval, establishing reimbursement tiers based on evidence of clinical benefit, and increasing enforcement of timely completion of postmarketing studies. “Additional suggestions based on the results of a modified Delphi panel on how to manage drugs and devices with limited evidence [are] to have an abstract of what a reasonable patient would want to know about a drug or medical device with information on benefits and harms, as well as the level of uncertainty concerning the evidence, and to include in the medical school and residency curriculum teaching on the FDA approval process and continuing medical education courses on the drug approval process. These strategies would promote high-value, evidence-based pharmaceuticals, in contrast with the current system.”