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April 4, 2006 Reimbursement and Phase IV: CRO Role In Clearing The Fourth Hurdle.

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Presentation on theme: "April 4, 2006 Reimbursement and Phase IV: CRO Role In Clearing The Fourth Hurdle."— Presentation transcript:

1 April 4, 2006 Reimbursement and Phase IV: CRO Role In Clearing The Fourth Hurdle

2 Objective Understand trends in payer use of Phase IV studies and registries Identify considerations for adapting Phase III and IV activities to accommodate those trends

3 U.S. reimbursement planning and problem solving since 1998 Former owner S&FA; Exec VP, PAREXEL Payer research; competitive analysis Strategic planning; reimbursement forecasting Advocacy with major payers

4 Tag Client Mix

5 Current Assignment Include Sepsis PDT HIV/AIDS Personalized cancer immunotherapy Immune globulins Osteoporosis Genetic testing Bleeding disorders

6 The Fourth Hurdle 1. Proof of efficacy 2. Acceptable safety 3. GMP 4. Reimbursement

7 4x4: 4 th Hurdle’s Link to Phase IV U.S. payers routinely require outcomes research to support coverage of high cost technologies High cost = “On my radar per case or in total”

8 Link – cont’d Tech developers are often reluctant to include in Phase III more than what is needed for FDA. That’s OK because … Payers want to know how new tech affects real populations, not protocol- driven clinical trial subjects But Phase III design should anticipate Phase IV data collection

9 Payers Want Practical Clinical Trials (PCTs) Evidence-based coverage policy will require PCTs –E.g. ICD Study design is formulated to enable treatment decision making –Distinguish from explanatory clinical trials designed to maximize the chance that a biological effect of a new tx will be revealed

10 PCT Characteristics Compare clinically relevant interventions –E.g. Enroll based on presenting symptoms rather than confirmed diagnosis Enroll a diverse population of study participants –E.g. Elderly not excluded

11 Characteristics – cont’d Recruit from a variety of practice settings Collect data on a broad range of health outcomes beyond mortality and morbidity –E.g. QoL, symptom severity, cost, patient satisfaction

12 MCO Views on Outcomes Data Economic data Most persuasive Clinical data Sometimes useful Quality of life Interesting but seldom compelling

13 Risks in Post Approval Trials Failure –Pfizer funded trial comparing its calcium channel blocker Norvasc to other antihypertensives –Generic diuretic (chlorthalidone) was shown to be superior in preventing certain cardiovascular outcomes

14 Risks – cont’d Credibility –Payers assume study lacks scientific rigor

15 Active Controlled Trials Payers want to know how the new tech compares to standard of care, not to absence of care Some manufacturers willing to risk active trials in Phase III because of payer, not FDA, pressure

16 Amgen Oncology and Osteoporosis Head-to-head trials of AMG-706 and Avastin Comparative trials of denosumab against Fosamax and Zometa “If not superior, we’d rather know now than later.”

17 AHRQ Payer Registry Guide Agency for Healthcare Research and Quality is developing “how to” guide for payers who create patient registries as part of coverage with evidence development On contract to Outcome Sciences, Inc.

18 Registry Guide – cont’d National workshop to be scheduled – date TBD Monitor at

19 Medicare Evolving to Be National Treatment Policy Manager CMS process for evaluating new technology is rigorous and evidence based Adverse Medicare coverage policy decision is routinely followed by private payers Part D benefit and Coverage With Evidence Development (CED) are accelerating the evolution

20 Part D More difficult for manufacturers to differentiate products via detailing Part D benefit design drives utilization toward generics, forcing undifferentiated products to lower net selling price

21 Part D – cont’d Part D Plan P&T committees rely heavily on comparative effectiveness data –Coverage decisions will likely migrate to Plans’ non-Medicare businesses

22 Medicare CED Coverage with evidence development for FDA approved drugs, biologicals, devices CMS can require evidence collection, including Phase IV trials and patient registries, as a condition for Medicare coverage

23 Features Will be used only where Medicare coverage would otherwise be denied as not reasonable or necessary Systematic, protocol-driven data collection No reimbursement for data collection

24 Most Likely To Be Used For … Drugs in new classes with novel mechanisms Treatments that may be ineffective or unsafe in some patient subgroups Off label uses

25 Awaiting New Guidance Document CMS intends to issue revised guidance by summer 2006 –Clarify Common Rule and IRB application to CED

26 One Current Use of CED Expand coverage of Eloxitin, Camptosar, Erbitux and Avastin off label for colorectal cancer Patient must be enrolled in NCI sponsored trial “Sufficient inference of benefit” + safeguards inherent in NCI sponsored trials

27 ICDs: Another Example of Evidence-Based Coverage Policy Situation: Trials of implantable cardioverter defibrillator (ICD) showed it to be effective in some patients but not in others High cost, large population, unsettled medical evidence resulted in adverse coverage policies

28 ICD Coverage Response: Manufacturer sponsored Phase IV trial: Sudden Cardiac Death in Heart Failure Trial (SCD-HeFT) Medicare expanded coverage to include study population

29 Outcome Trial provided evidence on survival benefit with simple, single lead ICD Medicare issued new national coverage determination

30 How CRO Can Prepare Client for The Fourth Hurdle Design Phase III for beyond Phase III Conduct primary research to understand what important payer(s) want to see in that therapeutic class –E.g. What metrics are relevant? PMPM Cost/savings Drug budget impact; Overall budget impact

31 How To Prepare – cont’d Press to have Phase IV studies be at least as rigorous and credible as Phase III Identify new tools to address payer needs –E.g. – validated biomarkers

32 Hypothetical Case New ADD/ADHD tx in development Will universally be 3 rd tier –Inherent safety concerns – pediatric – complicated by conflicting, government sponsored class findings –Not life saving –Many alternatives whose PMPM costs are well understood –Competitor performance contracts in place

33 Manufacturer Objective: Begin Moving To Tier 2 In Year 2 How will drug move from 3 rd to 2 nd tier? –Significant price concessions –Outcomes research (OR) Which is the better choice for client? If OR, then need to identify –Endpoints that are relevant to payers –Tools to accelerate conclusions

34 Example of Tool: Validated Cognitive Biomarkers How can validated cognitive biomarkers: –Identify patients who are likely responders to this drug? –Use response data to suggest cost effectiveness? –Produce data that is credible to the payer?

35 Summary U.S. payers, led by Medicare, now require post-marketing outcomes data to grant or continue coverage of new, high cost technologies Many pharma companies do not yet –Recognize the extent of the trend –Prepare adequately pre-launch –Find out from payers what they really need to see

36 Summary – cont’d Significant opportunity exists for CROs to fill the knowledge gap by –Determining payer data needs –Perfecting clinical trial tools to address those needs (e.g. validated biomarkers) –Helping clients understand that Market access does not end with FDA approval Phase III planning is essential to streamline the Phase IV work

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