September 2012 Edition Vol.11, Issue 9

The Promise of Oral Anticancer Agents: Addressing Compliance and Affordability

The Promise of Oral Anticancer Agents: Addressing Compliance and Affordability (continued)

Oral Parity Legislation

Many patients are not subject to any cost sharing for their injectable medications, whereas nearly all oral drugs are subject to cost sharing. This disparity has led to the introduction of state-level legislation to ensure that health insurers cover oral anticancer drugs no less favorably than IV chemotherapy. Since 2007, 17 states and the District of Columbia have enacted oral parity legislation. 

Some of the early state laws did not include a provision to prevent plans from raising the co-pay/coinsurance across the board to achieve parity, which would undermine the spirit of the law. More recent laws address this breach in the spirit of the legislation by noting that a plan cannot achieve parity by raising the OOP costs for oral drugs (e.g., move them to a specialty tier that requires a coinsurance). Even with such provisions in place, Kantar Health research suggests that there is still room to shift costs to patients to compensate for any relief provided by oral parity legislation. Over time, it seems likely that orals will be subject to coinsurance more frequently as this aligns better with IV coverage, and would arguably remain within the spirit of parity. 

Similar language exists among most of the state laws, but some have added clarifying language to address confusion or potential unintended consequences. At present, the Cancer Drug Coverage Parity Act (H.R. 2746) is working its way through the House Health, Employment Labor and Pensions Subcommittee. This legislation is unlikely to be passed in this Senate cycle as it is in early stages. If passed, the law would apply to self-funded plans in addition to fully funded plans, which are affected by state laws.

Conclusion

The introduction of oral anticancer drugs to treat relatively small patient populations with difficult-to-treat cancers has been paired with higher average monthly costs. For the typical Medicare patient, an oral drug priced at $10,000 per month places him immediately into and through the donut hole into catastrophic in the first fill until 2020, resulting in insurmountable upfront costs.

 Even if a patient were able to pay for the first fill and cross the donut hole, the co-pay simply “drops” to approximately $500 per month, a cost-share level that puts a drug at risk of losing approximately 25% of patients to “financial toxicity” in the absence of sufficient financial assistance.[7] As drug prices and the percentage of the population over the age of 65 continue to rise, this issue will only become more important despite the fact that a number of oral drugs will soon start to go off-patent. The introduction of generic options may reduce the price of a small number of oral agents by a significant percentage, but won’t address the underlying issue as technology continues to outpace loss of exclusivity.

Despite clinical advances and improved patient convenience, oral drugs come with unique compliance and patient affordability challenges compared with IV treatments. Much has been attempted to address the affordability issues facing these cancer drugs, including efforts to close the Medicare donut hole, provide assistance for patients through PAPs, and ensure a more equal playing field with oral parity legislation. However, these efforts are likely to introduce new affordability challenges.

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[7] The Kaiser Family Foundation and Health Research & Educational Trust Employer Health Benefits 2011 Annual Survey.

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About the Contributors

Rhoda Dunn is Senior Director of Oncology Commercial Strategies at Kantar Health.
Gordon Gochenauer is Director of Oncology Commercial Strategies at Kantar Health. 

Kantar Health is a global, evidence-based decision support partner to the world’s leading pharmaceutical, biotech, device and diagnostic companies. Our 700+ staff act as catalysts, working closely with customers to drive distinctive decision-making that help them prioritize product  development and portfolios, differentiate their brands and ensure product profitability after launch. We are unique in that we bring together clinical, medical and methodological expertise, commercial/marketing know-how and proprietary data. It is this rare combination, together with our unparalleled stakeholder reach, that enable us to mobilize incisive, imaginative and timely ROI-driven solutions, empowering clients to deliver better healthcare options to their customers. Kantar Health’s oncology-related offers include Oncology Market Access (OMA) US which provides strategic and tactical insights into the evolving oncology landscape. Combining Kantar Health’s commercial and clinical expertise in oncology, OMA US provides cutting-edge information and analysis on critical reimbursement, coverage and competitive issues in the US oncology marketplace. 

If you would like us to act as catalysts for you, contact us at www.kantarhealth.com/contactus

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