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I think CMS/Medicare's decision to review whether and to what extent
it will reimburse for Provenge, and to take a year doing it, is probably depressing the whole oncology sector somewhat. In the end I'm sure they will reimburse; at worst DNDN may feel it needs to reduce the price of Provenge and/or Medicare will refuse to cover off-label use. If the latter happens, it would actually benefit OGXI since Provenge's label is for asymptomatic prostate cancer, i.e. cancer which isn't yet causing bone pain and doesn't require chemo. So there would be no overlap with the intended use of OGX-O11 (although the P2 trial of OGX-427 seems intended for the same population as Provenge).
There has also been concern that Don Berwick, the guy Obama just appointed to head CMS, has expressed admiration for the British National Health Service's practice of weighing the price of a drug against its benefit. But I'm convinced there's no way Obama will let Medicare follow in the footsteps of the NHS, which has refused to cover Nexavar, for example, because it costs too much for a drug that extends life for only a few months. For one thing, Obama received a ton of money from big pharma in his campaign, and they make most of their money in the U.S., which is the only major market where the government doesn't negotiate drug prices so prices are higher here than anywhere else. Early on in the U.S. healthcare debate, Obama cut a deal with big pharma whereby he agreed that any healthcare reform would not provide for the government to negotiate drug prices. Second, virtually no cancer drugs extend life by more than a few months, so if the NHS approach were carried to its extreme -- which even the NHS doesn't do -- the government wouldn't reimburse for any cancer drugs.
I think DNDN blundered by refusing to include U.S. rights when it was trying to partner ex-U.S. rights with a big pharma. No big pharma would want to set a precedent that a small biotech could keep the lucrative U.S. market to itself. The consequence of DNDN's strategy has been that it hasn't found an ex-U.S. partner and doesn't have a pharmaceutical giant in its corner in its dealings with CMS. There have even been rumors that a big pharma may have initiated the request that CMS do a review of Provenge.
Fortunately OGXI has Teva, which while not quite a big pharma is close enough, since it has plenty of clout in Washington. If the OGX-011 trials succeed, I don't think there will be any problem getting reimbursement. (Of course, OGX-011 is also a lot cheaper than Provenge, though it does require medical personnel to administer more doses than for chemo alone.)
I agree with everything you have said. I'd like to just make a few comments. The leader of DNDN is making cowboy moves IMO like the former CEO of PARD. Originally the trial balloon was floated up for an annual cost for Provenge of $54000 per treatment. Still very expensive but something people could stomach in this era of high priced medicine. But $93000 per treatment is eye-popping IMO. The beauty with ANS is the cost will be extremely low per dose and will drop 10 fold for the cost of oligonucleotides that go in the med once ISIS completes their new manufacturing facility. This drug unlike Provenge will be very user friendly, a sq injection. For the pain indication it may also be used in Hospice and be given by Hospice nurses in the home. The Ying and Yang of it may be that oncologists may not get reimbursed for prescribing it because it may not have to be given in their offices, except for maybe the first dose. And as you so aptly pointed out the CEO of DNDN maybe have made a big error in trying to keep everything for himself in regards to rights for sale in the US. It reminds me of that Framm oil filter commercial or the old saying that sometimes being to cheap may actually cost you more. t
Thanks. Hadn't thought of hospice nurses and other modes of administering OGX-011 that would be relatively inexpensive.
I may have misstated Donald Berwick's position on the NHS. In a speech he gave in 2008, which is apparently the basis of the charges that he favors rationing based on cost, he praised the NHS in general and many specific aspects of it. But in looking over the transcript I don't see any evidence that he praised its policy of weighing a drug's price against its benefits:
Unless I'm missing something, it strikes me as just another example of Fox News and its ilk trying to spread panic.
CMS had reviewed both Avastin and Erbitux before. So it is nothing new. These two drugs cost similar or even more than Provenge. At worst, Provenge will be limited to strict on label use. Just think about if Provenge is not covered for on label use, but cover Avastin for MBC. The latter only showed PFS, not even MOS advantage, and cost about same for full course treatment.
<<There has also been concern that Don Berwick, the guy Obama just appointed to head CMS, has expressed admiration for the British National Health Service's practice of weighing the price of a drug against its benefit. But I'm convinced there's no way Obama will let Medicare follow in the footsteps of the NHS, which has refused to cover Nexavar, for example, because it costs too much for a drug that extends life for only a few months.>>
You are right we are not going to British route anytime soon, but for different reason. You have to establish standard of review first like British did, then apply the standard to each drug. You can't do it on ad hoc basis because of examples I gave in case of Avastin and Erbitux, otherwise think about outcry of covering breast cancer but not prostate cancer when costs are similar but benefit in PC is greater.
<<I think DNDN blundered by refusing to include U.S. rights when it was trying to partner ex-U.S. rights with a big pharma. No big pharma would want to set a precedent that a small biotech could keep the lucrative U.S. market to itself.>>
There are quite a few precedence recently. For example, INCY, AMAG all kept US rights while Novatis, Takeda got EU rights.
<< There have even been rumors that a big pharma may have initiated the request that CMS do a review of Provenge.>>
It has nothing to do with big pharma partner or not. As I said, Avastin and Erbitux had big pharma partners, they still got CMS review. Rather, this is typical chemo vs biologic battling for market share underneath the surface in the industry for years. It's silly because both have places in cancer treatment.
For all naysayers, Provenge will do fine long term because the data was strong. Immunotherapy will become bigger and bigger in cancer treatment. Chemo and biologic will be there as well for years to come. More drug combination like HIV is the future of cancer treatment.
JQ, I just have two questions if you could please. I honestly don't think that the system can support this kind of expense down the road. There are maybe a hundred new drugs for lymphoma and leukemia alone. How do you purport that the system will be able to handle all of these upcoming costs? The cost of DM type2 down the road has many experts thinking that that alone will bankrupt the health care system. And question number two is please explain to me the strong data than Provenge had in their last study. To me it looked like they just slithered under the fence to make it. TIA, t
I agree. HIV model is best way to understand so called "competition" in cancer space. Lets call it Spanish competition. The great Spaniard goal scorer yesterday who reveals a t-shirt praising a dead competitor in the Spanish league. Paying tribute to a competitor at such a magical moment...
I also think DNDN will do well in the US, and even in Europe. I wish I bought last summer, and when it went down to 25$ last week.
Provenge raises an interesting issue of cost/efficacy in public health care system (which is now embedded in USA).
I won't guess what will happen in US. But in Canada, provenge will never be approved based on current standards of what is acceptable for cost of extending lives in certain spaces and specific stages of a disease. We don't assume for a moment the Americans will follow our practices; but we share common traditions which give rise to general questions: what can taxpayers afford if certain standards are accepted? what constitutional challenges will prevail if certain bad standards are accepted (both US and Canada have written constitutions with protections for equal treatment). how much money will be wasted on litigation instead of treating sick people? are judges the best people to decide these issues instead of elected officials or administrative tribunals with medical expertise?
These issues will not raise concerns for OGXI. But DNDN seems to be at the forefront of these issues. It will get over them especially if Europe is a go. How can Medicare in the US do something different from the continental Europeans?