x-ray of lungs

Patients with severe persistent asthma have an unfortunately small number of treatment options, and all of them come with significant drawbacks. Oral corticosteroids have detrimental long-term effects, and often LABAs or LAMAs are not sufficient to control the disease. Xolair, for years the only biologic therapy on the market, suffers from inconvenient administration by subcutaneous injection in a clinical setting and prohibitive reimbursement restrictions requiring the demonstration of specific IgE levels, on top of being the most expensive treatment option. However, new biologic treatment options anticipated to launch in the next few years will give patients a breath of fresh air. Nucala, a new drug approved to treat severe asthma, was launched in late 2015 by respiratory giant GlaxoSmithKline. Nucala is administered subcutaneously in a physician’s office once a month and acts by inhibiting interleukin 5 (IL-5), thus suppressing the inflammatory response that causes asthma symptoms. However, this drug presents many of the same problems as Xolair, including the expense. How will the launch of several new biologic agents, along with concerns about pricing in the U.S. healthcare system, affect the asthma market?

  • Nucala (mepolizmab) was launched by GlaxoSmithKline in December 2015 and is the first IL-5 inhibitor approved for severe asthma with an eosinophilic phenotype.
  • The Pulmonary-Allergy Drugs Advisory Committee (PADAC) voted in favor of approving Cinqair (reslizumab), another IL-5 inhibitor, during its December meeting, clearing a major hurdle for final FDA approval of this drug, which is expected in March. Benralizumab is anticipated to file for approval later in 2016.
  • Nucala is anticipated to reach only a niche asthma market, and the drug’s current cost is $32,500 per year of treatment. With increasing concerns about the cost of prescription drugs and upcoming competitors, the pricing and reimbursement of Nucala will be an instructive case study for physicians, policy makers, and drug manufacturers.

The price point of Nucala was likely the result of a delicate balancing act on the part of GSK. Biologic drugs are notoriously expensive to develop and manufacture, especially compared to the small-molecule drugs that have dominated prescriptions for decades. In addition, GSK has the advantage of offering the first novel mechanism of action that the asthma market has seen in several years, aimed at a niche in desperate need of new therapies. In clinical trials, Nucala demonstrated an ability to reduce circulating eosinophil levels, thereby reducing the number of exacerbations leading to hospitalizations in asthma patients. Use of this drug could also decrease reliance on oral corticosteroids, potentially decreasing long-term harms patients suffer as a trade-off from controlling their asthma symptoms (Bel EH et al., 2014). It is certainly possible to argue that Nucala provides a unique benefit and is appropriately priced.

However, the increasing scrutiny on drug pricing and the anticipated launch of direct competitors within a relatively short time frame may force a re-think of the pricing strategy for this and other drugs. In fact, Nucala has already been singled out for a cost-benefit evaluation by the Institute for Clinical and Economic Review (ICER). The draft report calls for a reduction in price of 63-75%. However, this recommendation is dependent on a baseline price per quality-adjusted year of life gained. It does not satisfactorily take into account systemic savings from decreasing the number of exacerbations a patient experiences. ICER reports a cost savings of about $18,000 during a lifetime of taking Nucala; their calculations are based on an assumed 29 years of continuous treatment. ICER places the cost of an asthma-related hospitalization at $9960 per stay, while other sources estimate the price of a hospitalization due to an asthma exacerbation at $3000-$4000 (Stanford et al., 1999; Ivanova et al., 2012). Using the number of exacerbations prevented from ICER’s own report, avoiding hospitalization results in an estimated savings of $72,000 to nearly $240,000 (assuming that ICER “hospital stays” are due to exacerbations) over a lifetime, not factoring in any costs savings from avoidance of long-term complications of oral corticosteroids. Further complicating this analysis is the patent lifespan of a drug in the United States; even with lingering questions on biosimilars, no drug should expect to maintain exclusivity for 29 years. This makes it difficult to apply ICER’s conclusions, based on a lifetime of treating at $32,500 per year, to the complex real-world drug market. An analysis of drug pricing is certainly a useful exercise, but the draft report from ICER does not comprehensively address all of the factors that contribute to the price of a drug. More comprehensive and transparent analyses will be necessary to promote the conversation around value-based healthcare.

Aside from decisions made by payers in the complex reimbursement environment, which has not finished reacting to Nucala, the final price is likely to be impacted by the upcoming launch of a second IL-5 inhibitor. Cinqair (reslizumab), manufactured by Teva, is anticipated to launch before the end of 2016. Depending on the price set by Teva, physicians and patients could have a competitive choice for a drug with the same molecular target and similar clinical results. Even more interesting is the possibility that AstraZeneca’s benralizumab could be delivered in pre-loaded syringes for self-administration. Approval of this formulation may potentially allow AstraZeneca to demand a price premium in exchange for the increased convenience of at-home dosing. Additionally, IL-13 inhibitors and an IL-4/IL-13 inhibitor are also expected in the coming years. Although these would not compete directly with the IL-5 agents mechanistically, they would all target the severe persistent population of asthma patients, eventually providing an array of options and potentially driving the price down.

Following the pricing strategy of the three IL-5 inhibitors is likely to be an informative case study; watching for a response to ICER’s value-based pricing recommendation from both GlaxoSmithKline and insurers will begin to reveal the impact this sort of calculation will have in the coming years. In addition, Teva will have the opportunity to adjust their pricing strategy based on GSK’s response, and, with the anticipated launch of AstraZeneca’s IL-5 agent, competition may play a role in determining the final price patients and payers are willing to pay for relief of their asthma symptoms. Additionally, biologics are a growing piece of the healthcare market, and in this election year much attention is being paid to the cost of healthcare and prescription drugs in particular. Although this is a specialty drug for a relatively small patient population, the forces that will shape the delivery of prescription medications in the coming years are already at play.

For more information about the launch of Nucala, Decision Resources Group will be publishing a series of Emerging Therapies reports tracking the launch of this drug, with the first to publish in March (subject to change).

 

Related DRG reports:

Asthma | Unmet Need | Detailed, Expanded Analysis (Severe Asthma)

Asthma | Landscape & Forecast | Disease Landscape & Forecast

 

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Learn how to gain access to DRG's suite of asthma analytics, reports and experts:

Bel el al. Oral Glucocorticoid-Sparing Effect of Mepolizumab in Eosinophilic Asthma. New England Journal of Medicine. 2014;371:1189-1197.

Ivanova et al. Effect of asthma exacerbations on health care costs among asthmatic patients with moderate and severe persistent asthma. J Allergy Clin Immunol. 2012;129(5):1229-1235.

Stanford et al. The Cost of Asthma in the Emergency Department and Hospital. American Journal of Respiratory and Critical Care Medicine. 1999;160(1):211-215.

 

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