AT WHAT COST? EVALUATING RECENT TRENDS IN THE COSTS OF ORAL ANTICANCER DRUGS

Purpose: The cost of cancer treatments have risen to unprecedented heights, putting tremendous financial pressure on patients, payers, and society.  Understanding factors that are associated with changes in drug costs is critical to developing effective and appropriate policies to address these rapidly escalating costs.  Our objective was to examine trends in average per-patient total expenditures for recently approved oral anticancer drugs.  

Method: We used 2007-2013 pharmacy claims from Truven Health Analytics MarketScan Databases to obtain average monthly per-patient expenditures for orally administered anticancer drugs initially approved by the FDA between 2000 and 2013.  The unit of analysis was average monthly expenditures in each quarter between 2007 and 2013 for each drug after receiving FDA approval.  We used multivariable fixed-effects regression models to explore whether and how changes in average monthly reimbursements for each drug over time were associated with receipt of supplemental indications from the FDA and/or the introduction of a competitor, defined as a newly FDA-approved drug with an indication for the same patient population.  Costs were inflated to 2014 USD using the medical care component of the CPI. 

Result: Between 2007 and 2013, total per-patient monthly expenditures increased, on average, 3.7% per year (95% CI: 3.1%, 4.4%) over general medical inflation; however, we observed substantial heterogeneity over time and across drugs in these changes.  For example, sunitinib exhibited both a 15% decrease and a 13% increase in monthly expenditures over time during the study period.  After adjusting for general time trends, obtaining an additional supplemental indication by the FDA was associated with a $551 (95% CI: $328, $774) increase whereas introduction of a competitor drug was associated with a $215 (95% CI: $130, $300) decrease in average monthly expenditures. Similarly, we found an $832 [95% CI: $485, $1180] increase in average monthly expenditures with an increase of 1,000 individuals in the size of the annual incidence for which the drug was indicated.  

Conclusion: We observed substantial increases in the total reimbursements of recently approved oral anticancer medications that were associated with the number of additional FDA approved indications and increases in the size of the eligible patient population.  Whether these increasing costs represent higher demand or more effective use of monopoly status warrants further exploration.