Oncology and Off Label Use: Trends in Management by Health Plans

Rhonda Greenapple
President
Reimbursement Intelligence

Up to recently, oncology treatment decisions were exempt from health plan interference. .With the newer products having high costs and with multiple products entering the same category, there is increasing management as well as cost shifting for oncology patients.

With product such as Avastin costing $8,100 and Vectibix $14,000, there is a need to better monitor utilization as appropriate and on label.

What are the methods used by health plans to managed IV chemotherapy agents in the physician’s office?

Prior Authorization

This requires that the physician provide clinical information to get approval for use. These requirements can be statement of medical necessity from the physician, specific lab or diagnostic values, and prior therapies. The list below indicates the rate of prior authorization in some recognized ‘wonder drugs” that are seen as highly effective.

Avastin	38%
Campath	25%
Erbitux	37%
Herceptin	30%
Velcade	30%
Rituxan	36%

Plans also monitor these products to ensure not only for appropriate use but also “off label” use.

Off Label Use Restrictions

Plans that are more aggressive in managing oncology drugs can exclude “experimental” or investigation” treatments. However, this is usually a judgment call by the plans Medical and Pharmacy team.

The plan uses all or some of the following factors in deciding to cover an “off label” indication.

Number of studies and patients in whom the drug has been used

Rigor of the studies in which it has been used

Cure or response rate in these studies

Current state of treatment in type of cancer in which the drug is used

Whether of not the drug and/or indication has been approved by the FDA

Generally, the rule of thumb is to require two peer reviewed publications.

Formulary Evaluation for Cancer Agents

The FDA is looking closely at overall survival as an endpoint that is critical to approval. Managed Care also is looking at whether it is “worth it” to give a product that will only increase survival 5 months or less.

It will become more of an issue as more and more drugs reach the market. The freedom of choice for oncologists will be decreasing and oncology management increasing.

Cancer patients do need to have special consideration when treatment decisions are made. Health plan are looking at what is the “value” of this product in improving the patients health outcomes and quality of life.

Oncology is a focus of many emerging biotech and specialty pharmacy companies. It is critical to understand the reimbursement landscape based on physician and payer reimbursement and management.

It is also important to understand how your product can influence oncologist revenue stream and how payers will perceive its value.

Reimbursement Intelligence is a consulting firm helping investors and emerging biotech with due diligence and business planning. Their sole focus is helping our customers understand the implications of reimbursement and formulary access on the commercial success of their product.

For more information, please contact Rhonda Greenapple at rgreenapple@reimbursementintelligence.com or 973 805 2301.