Interpreting Cost-Effectiveness Analyses in the Context of Product Listing Agreements: NIHB s Reanalysis of CADTH s Hepatitis C Therapeutic Review

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Interpreting Cost-Effectiveness Analyses in the Context of Product Listing Agreements: NIHB s Reanalysis of CADTH s Hepatitis C Therapeutic Review

1 Interpreting Cost-Effectiveness Analyses in the Context of Product Listing Agreements: NIHB s Reanalysis of CADTH s Hepatitis C Therapeutic Review Andrew Portolesi, Biostatistician, Non-Insured Health Benefits Program, First Nations & Inuit Health Branch, Health Canada CADTH Symposium Apr 12, 2016

2 Outline Introduction The Non-Insured Health Benefits (NIHB) Program Chronic hepatitis C infection (CHC) CADTH s Therapeutic Review: Drugs for Chronic Hepatitis C Infection Product Listing Agreements (PLAs) Problem How can CDR/CDEC make cost-effectiveness recommendations when actual (PLA) pricing is confidential? Solution Considerations Worked Example Conclusion 2

3 Overview of the NIHB Program The Non-Insured Health Benefits (NIHB) Program is Health Canada's national, medically necessary health benefit program that provides coverage for benefit claims for a specified range of drugs, dental care, vision care, medical supplies and equipment, short-term crisis intervention mental health counselling and medical transportation for eligible First Nations people and Inuit. Costs: NIHB provides benefit coverage to over 824,000 eligible clients Total benefit expenditures in 2014/15 were $1.03B Pharmacy expenditures $422M In order to determine whether or not to cover new medications, NIHB receives recommendations from the Canadian Drug Expert Committee (CDEC, part of the Common Drug Review CDR run by the Canadian Agency for Drugs & Technologies in Health CADTH), the national cost-effectiveness expert review body for public drug plans in Canada and an international leader in costeffectiveness analysis. Source: NIHB Annual Report 2014/15

4 What is hepatitis C? Hepatitis C (HCV) infection is a blood-borne disease, often chronic, and can result in severe liver disease, cirrhosis, and cancer Chronic Hepatitis C infection (CHC) develops in 74% those that become infected with HCV who fail to naturally clear the virus CHC disproportionately high in Aboriginal populations (prevalence of 2-4% vs. 0.6% for the general Canadian population) Aboriginal CHC represents 10-20% of CHC in Canada (25,000-50,000 out of 244,000) With HC s approval of the new Direct-Acting Antiviral Agents (DAAs), CHC can now be reliably treated Previous Treatments (PegIFN-based) Low cure rates Severe side effects Long treatment (24-48 weeks) Require daily injections $10K-$40K per treatment New Treatments (PegIFN-free DAAs) High cure rates (up to 90%) Mild side effects Shorter treatment (8-24 weeks) Administered orally (pills) $45K-$134K per treatment Treating all CHC in the entire Canadian CHC population with the new DAAs would cost approx. $15B (1% of GDP) Sources: PHAC, Product Monographs 4

Treatments for CHC: Timeline 1999: Peginterferon/Ribavirin ( PegIFN/RBV or PR

cure rates, similar or worse side effects since used in combination with

Galexos*) Oral, same or higher cure rates as 1 st -gen, less side effects

duration 2014: 3 rd -generation DAAs (Harvoni & Holkira Pak**) Oral, high

duration 2015: Additional treatments (Daklinza & Technivie) Add-on therapies

5 Treatments for CHC: Timeline 1999: Peginterferon/Ribavirin ( PegIFN/RBV or PR ) Injection (PegIFN), low cure rates, bad side effects, long treatment duration 2011: 1 st -generation DAAs (Victrelis & Incivek) Oral (i.e. tablets/capsules), increased cure rates, similar or worse side effects since used in combination with PegIFN/RBV, same treatment duration 2013: 2 nd -generation DAAs (Sovaldi & Galexos*) Oral, same or higher cure rates as 1 st -gen, less side effects since still used in combination with PegIFN/RBV but with a shorter treatment duration 2014: 3 rd -generation DAAs (Harvoni & Holkira Pak**) Oral, high cure rates, low side effects, no PegIFN (only sometimes RBV), short treatment duration 2015: Additional treatments (Daklinza & Technivie) Add-on therapies & products for rarer genotypes 2016: Pan-Genotypic DAAs *Marketed as Olysio in the US **Marketed as Viekira Pak in the US Source: Product Monographs 5

6 CADTH Therapeutic Review: Drugs for CHC CADTH has performed their own independent Therapeutic Review of treatments for Chronic Hepatitis C (CADTH CHC TR): Comprised of a clinical review (systematic review & meta-analysis), pharmacoeconomic review (economic modeling) and patient group input of drugs for CHC Update of the 2014 Therapeutic Review to include all current evidence for new therapies (i.e. adding Harvoni, Sovaldi, Holkira Pak, Daklinza) and cover all genotypes The CADTH CHC TR pools together all available evidence for these new drugs, comparing their effectiveness, safety and cost-effectiveness (using retail pricing) Uses the best methodology for Systematic Reviews, Network Meta-Analysis (NMA) and economic modeling for Cost-Utility Analysis (CUA) Compared to CDR reviews for individual drugs, which rely on reviewing individual manufacturers economic models Recommendation report published in Nov 2015 A gold standard in HTA Source: CADTH TR: Drugs for Chronic Hepatitis C 6

7 What are Product Listing Agreements (PLAs)? A Product Listing Agreement (PLA) is a negotiated agreement between a drug plan and a drug company that allows the plan to cover a specific drug at a reduced price through the use of a rebate PLAs allow drug plans to cover medications that otherwise would not be considered cost-effective or affordable NIHB and other federal drug plans have recently joined the pan-canadian Pharmaceutical Alliance (pcpa), the national initiative for provincial/territorial public drug plans to collectively negotiate PLAs Product Listing Agreements (PLAs) have become a de facto tool in the management of public drug plans in Canada The result of a PLA is a negotiated net price that is confidential between a drug plan and a drug company (i.e. cannot be disclosed to CADTH) 7

8 Total Costs Total Costs Problem With the actual price each plan pays for a given drug being confidential and thus unknown (and cannot be disclosed to) to CADTH, the usefulness of the CDR has ben called into question as its recommendations apply to what may be entirely different sets of prices. This issue is especially impactful when the comparator(s) in a review are already under PLAs: Comparator Intervention Not Cost-Effective 25 Cost-Effective (?) Current Scenario: CDEC Recommends List at a Reduced Price Emerging Scenario: Comparator PLA Pricing Unknown to CADTH Retail Price Retail Price CDR Confidential Price CDR Confidential Price PLA Price* PLA Price* Retail Price Retail Price PLA Price* Effectiveness (Total QALYs) Effectiveness (Total QALYs) *PLA pricing unknown to CADTH 8

Total Cost $220,000 Figure: CADTH CHC 2015 TR: Cost-Effectiveness Plane Genotype 1

Effective More Effective Sovaldi + Galexos + RBV 12 Sovaldi + Galexos 12 Less Costly $160,000

24 *Daklinza + Sovaldi 12 Holkira Pak 12 Incivek Galexos Victrelis *Harvoni 8 $120,000 PR 48 No

9 Total Cost $220,000 Figure: CADTH CHC 2015 TR: Cost-Effectiveness Plane Genotype 1 Treatment-Naïve Non-Cirrhotic (G1TNNC) $200,000 More Costly Sovaldi + RBV 24 $180,000 Less Effective More Effective Sovaldi + Galexos + RBV 12 Sovaldi + Galexos 12 Less Costly $160,000 $140,000 Harvoni 12 Sovaldi 12 + PR RGT Sovaldi + PR 12 Holkira Pak + RBV 12 *Daklinza + Sunvepra 24 *Daklinza + Sovaldi 12 Holkira Pak 12 Incivek Galexos Victrelis *Harvoni 8 $120,000 PR 48 No Treatment $100, Effectiveness (Total QALYs) Source: CADTH TR: Drugs for Chronic Hepatitis C

10 NIHB s Solution For the CADTH CHC Therapeutic Review, following the advice of CADTH experts, the NIHB Program reanalyzed the cost-effectiveness results by subtracting the applicable PLA discount for each regimen to determine its own incremental cost-utility ratios ( Net Price ICUR ), to which it applied CDEC's decision-making rationale This methodology is justified since treatment costs are direct costs which can be subtracted from the CU tables without re-running the pharmacoeconomic model as every patient in model receives treatment. Significant discounts on indirect costs (e.g. drugs to treat significant sideeffects) would require re-running of model Applying PLA discount also considered for modeled discontinuation rate (e.g. CADTH model assumed discontinuing halfway through, so removed half of discontinuation rate) Specific to this Therapeutic Review, NIHB also excluded PegIFN/RBV (PR) from the cost-effectiveness analysis by considering it dominated by new treatments by patient values 10

11 NIHB s Methodology 1. Understand Cost-Utility Analysis (CUA) and CDEC s use of CUA in this review (i.e. economic model, ICURs and sensitivity analysis) 2. Extract CUA Tables (Total Costs, Total QALYs, ICURs) used by CDEC 3. Determine plan-specific discount amount for each modeled medication regimen 4. Reduce discounts according to modeled discontinuation rates (e.g. 5% discontinuing halfway through = reduce discount by 2.5%) 5. Additional considerations (e.g. removal of non-applicable comparators) 6. Recalculate CUA table to obtain plan-specific cost-effectiveness: the Net Price ICUR 7. Apply CADTH s decision-making rationale (including sensitivity analysis) using new ICURs 11

12 Considerations Technically, this is a post-hoc analysis, so we have to avoid arbitrary methodologic decisions Requirements: High-quality HTA Reporting of detailed cost-utility tables (Totals Costs & Total QALYs, not just incremental costs) Understanding of pharmacoeconomic model (e.g. how to apply discontinuation rates) Knowledge of ICUR algorithm and CUA in general (but don t be beholden to the algorithm) Knowledge of CDEC s decision-making rationale (not just the rationale for their final decision), including interpretation of sensitivity analysis Model where fundamental unit is a patient who received treatment Can t disclose Net Price ICURs to drug companies as that could reveal competitors products PLA discounts 12

13 CHC TR: Removing PR as Dominated by Patient Values Specific to the CADTH CHC TR, CDEC excluded PR from consideration based on patient values (i.e. with the new DAAs, it s unethical to consider recommending treating someone with PR anymore). In its reanalysis, NIHB listed PR as dominated by patient values. This dominated isn t the more-costly-less-effective domination in the usual CUA sense, but dominated in the sense that you d never recommend PR when a new DAA is an option (i.e. not using the usual cost & effectiveness set of values, but using a different set of values: namely, patient values). Example, table 19 (Genotype 2 Treatment-Naïve Non-Cirrhotic): Treatment Total Cost Total QALYs Sequential ICUR (70) PR24 $99, reference (3) SOF12 + RBV12 $143, $203,282 (0) No Treatment $104, dominated by (70) (40) So12 PR12 $145, dominated by (3) Cost-Effectiveness Analysis Table 19: G2 TN NC using PR as a reference Treatment Total Cost Total QALYs Sequential ICUR (0) No Treatment $104, reference (3) SOF12 + RBV12 $143, $19,380 (70) PR24 $99, dominated by (3) using patient values (40) So12 PR12 $145, dominated by (3) Cost-Effectiveness Analysis Table 19, adjusted: G2 TN NC using No Treatment as a reference since PR cannot be recommended Source: CADTH TR: Drugs for Chronic Hepatitis C

Recalculation of all ICURs with PR Dominated by Patient Values Incremental Cost-Utility Ratios (ICURs) for new DAAs for CHC (CADTH TR, Retail) ICURs by Genotype 1 Genotype 2 Genotype 3 Genotype 4

14 Recalculation of all ICURs with PR Dominated by Patient Values Incremental Cost-Utility Ratios (ICURs) for new DAAs for CHC (CADTH TR, Retail) ICURs by Genotype 1 Genotype 2 Genotype 3 Genotype 4 Subgroup TN TE TN TE TN TE TN TE F0 $47,066 $30,154 $320,829 $33,037 $247,949 $69,205 $369,661 $96,056 F1 $40,192 $25,067 $276,590 $27,370 $205,679 $55,946 $315,469 $78,634 F2 $29,242 $17,698 $203,052 $19,209 $151,071 $40,082 $227,554 $53,784 F3 $21,332 $12,749 $146,489 $13,741 $115,513 $30,413 $161,766 $37,410 F4 (Cirrhotic) $23,047 $17,669 $58,659 $18,226 $92,117 $43,292 $59,492 $37,303 Removing PR and recalculating ICURs Retail ICURs with PegIFN/RBV removed (CADTH TR, Retail, No PR): ICURs by Genotype 1 Genotype 2 Genotype 3 Genotype 4 Subgroup TN TE TN TE TN TE TN TE F0 $31,148 $30,154 $31,195 $33,037 $66,549 $69,205 $94,660 $96,056 F1 $25,873 $25,067 $27,522 $27,370 $53,746 $55,946 $77,415 $78,634 F2 $18,227 $17,698 $19,311 $19,209 $38,481 $40,082 $52,880 $53,784 F3 $13,109 $12,749 $13,812 $13,741 $29,179 $30,413 $36,723 $37,410 F4 (Cirrhotic) $17,816 $18,646 $18,542 $18,226 $34,372 $43,292 $35,996 $37,303 F0: No liver damage, F4: Liver cirrhosis, TN: Treatment-Naïve,TE: Treatment-Experienced (with PegIFN/RBV) 14

15 Worked Example (CHC TR with Fictitious Discounts) Using Genotype 1 Treatment-Naïve Non-Cirrhotic (Table 15), with fake discounts: Harvoni Holkira Pak Sovaldi Galexos Incivek Victrelis RBV PR 21% 13% 20% 12% 14% 20% 11% 15% Calculation of discount amount is non-trivial: calculate component costs of each regimen (not shown), then apply discounts according to discontinuation rates: Regimen Retail Price Discontinuation Rate Discount Net Price No Treatment $0 0.0% $0 $0 PR 48w $19, % -$2,603 $16,397 Victrelis + PR RGT $40, % -$6,493 $33,527 Galexos + PR RGT $47, % -$5,796 $41,546 Incivek + PR RGT $47, % -$6,510 $41,312 Sovaldi + PR 12w $55, % -$10,406 $44,594 Holkira Pak 12w $55, % -$7,244 $48,616 Sovaldi + Galexos + RBV 12w $58, % -$11,266 $47,084 Holkira Pak + RBV 12w $59, % -$7,573 $51,637 Sovaldi + PR RGT $65, % -$11,957 $53,883 Harvoni 12w $67, % -$13,760 $53,240 Sovaldi + Galexos 12w $91, % -$15,126 $76,376 Sovaldi + RBV 24w $116, % -$22,123 $94,577 e.g. PR 48w: Net Price = $19,000 x ( x ( / 2 ) ) Source: CADTH TR: Drugs for Chronic Hepatitis C, with made-up discounts 15

16 Worked Example (CHC TR with Fictitious Discounts) Original CUA Table: Treatment Total Cost Total QALYs Sequential ICUR No Treatment $104, ref PR 48w $114, $8,353 Holkira Pak 12w $143, $29,534 Harvoni 12w $152, $435,528 Victrelis + PR RGT $135, ext. dominated Galexos + PR RGT $136, ext. dominated Incivek + PR RGT $137, dominated Holkira Pak + RBV 12w $146, ext. dominated Sovaldi + PR 12w $146, dominated Sovaldi + PR RGT $150, dominated Sovaldi + Galexos 12w $178, dominated Sovaldi + Galexos + RBV 12w $182, dominated Sovaldi + RBV 24w $201, dominated PR Dominated by Patient Values: Treatment Total Cost Total QALYs Sequential ICUR No Treatment $104, ref Holkira Pak 12w $143, $18,313 Harvoni 12w $152, $426,500 PR 48w $114, dominated by pt values Victrelis + PR RGT $135, ext. dominated Galexos + PR RGT $136, ext. dominated Incivek + PR RGT $137, dominated Holkira Pak + RBV 12w $146, ext. dominated Sovaldi + PR 12w $146, dominated Sovaldi + PR RGT $150, dominated Sovaldi + Galexos 12w $178, dominated Sovaldi + Galexos + RBV 12w $182, dominated Sovaldi + RBV 24w $201, dominated CUA Table with PLA Discounts: Treatment Total Cost Discount Net total Cost Total QALYs Net Price Sequential ICUR No Treatment $104,904 $0 $104, ref Holkira Pak + RBV 12w $146,021 -$7,573 $138, $15,920 Harvoni 12w $152,762 -$13,760 $139, $34,601 PR 48w $114,105 -$2,603 $111, dominated by pt values Victrelis + PR RGT $135,218 -$6,493 $128, ext. dominated Incivek + PR RGT $137,381 -$6,510 $130, dominated Galexos + PR RGT $136,770 -$5,796 $130, ext. dominated Sovaldi + PR 12w $146,140 -$10,406 $135, ext. dominated Holkira Pak 12w $143,379 -$7,244 $136, dominated Sovaldi + PR RGT $150,969 -$11,957 $139, dominated Sovaldi + Galexos 12w $178,356 -$15,126 $163, dominated Sovaldi + Galexos + RBV 12w $182,383 -$11,266 $171, dominated Sovaldi + RBV 24w $201,979 -$22,123 $179, dominated Source: CADTH TR: Drugs for Chronic Hepatitis C 16

17 Conclusion NIHB was able to determine its own cost-effectiveness (the Net Price ICUR ) under its PLA pricing for the new DAAs for CHC without additional work by CADTH NIHB also demonstrated that several subgroups recommended for listing by CDEC but not reported as cost-effective are actually cost-effective upon dominating PegIFN/RBV due to patient values While the usefulness of CDR has been called into question in the context of Product Listing Agreements, with sufficient cost-effectiveness information supplied by CDEC and an understanding of cost-effectiveness analysis, public drug plans are able apply CDEC recommendations to their own pricing context By phasing out the CDR Confidential Price (phased out Apr 1, 2016) and using retail pricing in its reviews, CADTH will continue to be provide relevant analysis and recommendations to plans in the new management paradigm of Product Listing Agreements 17

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