Transcript bonn.simon-kucher.com

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
2008
30.1 billion
19.4 billion
+12%
2013
2013
21.8 billion
EU-5
USA
+20%
37.2 billion
% 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.
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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.
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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*
Xalkori
Avastin
docetaxel
Targeted
therapy
Perjeta Herceptin
Keytruda
Immunotherapy
Combination
therapy
RxDx
Today
Near
future
Recent past
Chemotherapy
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
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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.
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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
1st indication: 1st line HER2+ mBC
EM June 2012
April 2013
2nd 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
Perjeta
Herceptin
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
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).
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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.
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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
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
Discounting
Core value drivers
Budget
impact
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
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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…
Select recent oncology drugs for which an early benefit evaluation was conducted
Available data at
launch
Jevtana
Zytiga
Halaven
Yervoy
Zelboraf
Xalkori
Adcetris
(cabazitaxel)
(abiraterone)
(eribulin)
(ipilimumab)
(vemurafenib)
(crizotinib)
(brentuximab)
Prostate
cancer
Prostate
cancer
Breast
cancer
Melanoma
Melanoma
NSCLC
Hodgkin’s
lymphoma
Target indication
Mean OS
no data
Symptoms
no data
HRQoL
no data
no data
no data
no data
Outcome: Additional benefit
…and detailed evaluation by subgroups are common
Product
Perjeta
(pertuzumab)
Xalkori
(crizotinib)
Subgroup 1
Patients with visceral metastases
Patients where chemotherapy is indicated
(ECOG performance status 0,1 and 2)
Jevtana
(cabazitaxel)
Zytiga
Patients with docetaxel re-treatment is not
an option
(abiraterone)
Subgroup 2
Patients with non-visceral metastasis or
Considerable
patients with locally recurrent, inoperable
benefit
breast cancer
Patients where chemotherapy is not
Considerable
indicted (ECOG performance status of 4,2
benefit
and possibly 2)
Minor benefit
Patients where docetaxel re-treatment is
Considerable an option
benefit
No benefit
No benefit
No benefit
No benefit
Source: Simon-Kucher & Partners 2014.
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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
The TC can penalize submissions that are
lacking in comparative data when
determining ASMR
Manufacturers penalized for submitting
with Phase II and ORR data only
Cancer drug fund assessment:
Major
Important
I
II
Moderate
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
None
V
Jevtana (cabazitaxel) –advanced
prostate cancer
 2011: Received an initial ASMR
rating of IV, which did not lead to
T2A exclusion
 2013: Achieved ASMR III and T2A
exclusion list by re-filing with new
data
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 wildtype KRAS mCC
Source: Simon-Kucher & Partners 2014.
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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.
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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
Elimination of the “add-on”
tariff in 2015: New system is
under development but details
are unknown
UK
2014: Product-specific
expenditure cap: A new
tool for national payers to
control budgets
France
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.
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.
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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
Spain
(old)
(current)
France
(current)
France
Australia
(old)
Italy
Diagnostic tests are
funded out of general
hospital or regional
health authority budgets
Germany
Funding through
alternative institutions
Brazil
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.
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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
Now
Before
National
access
Spain
Regional
access
Common for high
cost oncology drugs
with uncertain
efficacy
Local /
Hospital
National
access
Dual pricing
National
rebate
List ex-manu
Rebate to
regions
Net ex manu
Rebate to
local payers
Trending in Spain:
New instruments at the national level for P&MA negotiations
Introduction of dual pricing in
April 2012:
Additional confidential discounts
are expected to be negotiated at
the national level in return for
funding
Almost half of drugs affected by
dual-pricing are oncologic launches
44%
Oncology
56%
Other
Source: Simon-Kucher & Partners 2014.
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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: leverage collective purchasing power
of provincial drug plans (except QC) to negotiate lower
prices for prescription drugs
- Created in 2010 but sporadic implementation until
~2013
 Recently, it has become the de facto expectation for
most drugs reviewed by pCODR, especially innovative
oncology therapies
Source: Simon-Kucher & Partners 2014.
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Trending in P&MA #3: Evolving contracting
Trending in the UK: Recently, only discount-related patient
access schemes have been accepted by NICE
Decline in response-based schemes
are the standard for NICE
Past
Response
schemes
Rebates
In 2013, half of the drugs with approved patient
access schemes (PAS) are in oncology
Autoimmune
diseases
(11)
Discount
schemes
2007/2008
Other
(7)
Oncology
(n = 18)
Number of drugs
with approved PAS
(n = 36)
Discount scheme
n = 13
Dose cap/free stock
Single fixed price
2013
Now 0%
Rebate
Breakdown of the types of PAS*
100%
All PAS other than
discount schemes
were set up before
July 2010
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/
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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
Recent case studies from oncology
Patient access schemes need to be tailored to each
individual drug – there is no “one-size fits all”-solution
EMA approval
Drug
Indication
Patient access scheme
Halaven
(eribulin)
Metastatic
breast
cancer
Risk-sharing agreement
Jevtana
(cabazitaxel)
Prostate
cancer
Budget cap of €15 million
Arzerra
(ofatumumab)
Yondelis
(trabectedin)
Yervoy
(ipilimumab)
Chronic
Cost-sharing agreement
lymphocytic (50% reimbursed only)
leukaemia Undisclosed discount to NHS
Payment-by-results
Soft tissue
(payback of first two cycles if
sarcoma
permanently discontinued)
Budget cap of €30m for first
year, €50m for the second year
Payment-by-results scheme
Melanoma (100% payback if treatment
discontinued before the third
dose)
Undisclosed discount to NHS
3/17/2011
3/17/2011
4/19/2010
9/17/2007
Time between EMA approval and
market access in Italy
9 months
9 months
Approx. 1 year
Approx. 1.5 years
P&R agreement
05/01/2012
08/12/2011
14/06/2011
11/02/2009
Approx. 1.5 years
7/13/2011
22/02/2013
Source: Simon-Kucher & Partners 2014.
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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
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Discussion: Future oncology P&MA prognosis
Key consideration: Development of P&MA strategy will
become increasingly complex
Future P&MA strategy in oncology
Key factors behind oncology P&MA
Source: Simon-Kucher & Partners 2014.
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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
Oncology
indication 3
Oncology
indication 2
High
Optimizing launch order*
1
Indication 1
2
Indication 3
3
Indication 2
Low
Oncology
indication 1
Competitive advantage
Increasing price potential
Assess payer willingness-to-pay by indication
Low
Market attractiveness
High
Indication expansion in the order of descending price potential maximizes payer
willingness-to-pay at all times
Source: Simon-Kucher & Partners 2014.
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Discussion: Future oncology P&MA prognosis
Key consideration: Increasing emphasis on incremental valueadd over current options will lead to higher focus on biomarkers
Evaluation of biomarker opportunity
Source: Simon-Kucher & Partners 2014.
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Additional group discussion points
Thank you!
Source: Simon-Kucher & Partners 2014.
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Thank You !
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