Recently, the U.S. Food and Drug Administration (FDA) approved Kymriah™ (tisagenlecleucel –pronounced tis-a-gen-LEK-loo-sell), for certain pediatric and young adult patients with a relapsed form of acute lymphoblastic leukemia (ALL). ALL is the most common cancer in children.1 Kymriah will have a list price of $475,000 for a one-time treatment.2
The FDA announcement quoted FDA Commissioner Scott Gottlieb, M.D. who said: "We’re entering a new frontier in medical innovation with the ability to reprogram a patient’s own cells to attack a deadly cancer. New technologies such as gene and cell therapies hold out the potential to transform medicine and create an inflection point in our ability to treat and even cure many intractable illnesses."1
We’re entering a new frontier in medical innovation with the ability to reprogram a patient’s own cells to attack a deadly cancer.– Scott Gottlieb, M.D. FDA Commissioner
The announcement also precedes FDA’s self-imposed decision date, originally scheduled for early October, by over a month. It comes less than two months after a vote earlier this summer by an FDA advisory committee, which unanimously recommended FDA approval for Kymriah. With this full FDA approval, Kymriah gives doctors a new tool for treating relapsed or refractory B-cell acute lymphoblastic leukemia (ALL) in children and young adults.3
Until recently, CAR T therapy has been restricted to small clinical trials, focusing on patients with advanced blood cancers. But even in trials, CAR T treatments have drawn considerable attention due to the positive responses they have produced in some patients for whom all other treatments had stopped working.4
A new take on immunotherapy
There are several forms of immunotherapy, and it is already a big business. The heavily-advertised immunotherapy drugs Keytruda® (pembrolizumab) and Opdivo® (nivolumab) came to market in 2015. We have written previously about immunotherapy, most recently here.
Kymriah is a new form of immunotherapy called CAR T-cell therapy – short for Chimeric Antigen Receptor T-cell therapy.4
CAR T treatment is different from the type of immunotherapy currently on the market. It involves taking naturally occurring infection-fighting cells, called T-cells, re-engineering them, and then putting the altered T cells back in the body where they can attack cancer cells.4
Because of their unique design, these special T cells can recognize and attach to a specific protein on the surface of tumor cells. The final step is infusing the CAR T cells back into the patient, who has been prepped with a chemotherapy regimen to wipe out some of their existing immune cells.4
When the therapy works properly, the engineered cells continue to multiply in the patient’s body and proceed to kill cancer cells.3 A single engineered T cell can wipe out up to 100,000 cancer cells.5
Idealized illustration of the CAR T Process
Sucessful trial outcomes
As mentioned above, the initital approval for Kymriah is to treat acute lymphoblastic leukemia (ALL) in children and young adults. The National Cancer Institute estimates that approximately 3,100 patients aged 20 and younger are diagnosed with ALL each year.1
More than 80% of children diagnosed with the most common form of ALL will be cured by intensive chemotherapy. However, approximately 15% of pediatric ALL patients will relapse after high-dose chemotherapy. Their only option is a stem cell transplant.3
For patients whose cancers return after chemotherapy or a stem cell transplant, there are few or no remaining treatment options. In fact, relapsed ALL is a leading cause of death from childhood cancer.4
The trial results that prompted the FDA approval have been described elsewhere as showing “dramatic efficacy” — an 83% overall remission rate in treating patients with stubborn or unmanageable cancers.3
Already there are CAR T patients who in the past would have been considered terminal, but who by now have been in durable and meaningful remission for up to five years, with a good quality of life.4
As with virtually any medical intervention, there are risks associated with CAR T therapy. The FDA emphasizes these risks by noting that treatment with Kymriah has the potential to cause severe side effects.1
Remember that the whole point of CAR T is to introduce super-potent T cells into the patient’s body. Sometimes this can cause the body’s immune response to react in dangerous ways.
Many CAR T patients experience a condition called cytokine release syndrome (CRS), sometimes called a “cytokine storm.” CRS can cause severe fevers, nausea, extreme fatigue, difficulty breathing, low blood pressure, and organ swelling. Depending on the severity of the response, it can even prove fatal.1
Novartis reports that 81% of CAR T patients experienced CRS while being treated in trials.3
Another risk from CAR T therapy is neurotoxicity: Patients with this reaction can experience memory loss, hallucinations, and cerebral edema (swelling of the brain). It’s still not clear exactly what causes the neurotoxic reaction, but it’s already proven deadly.6 At least five people enrolled in CAR T clinical trials have died in the last year, all from cerebral edema.6
While neurotoxicities can be serious, the problem appears to be limited. For example, there were no cases of cerebral edema in the Novartis trials. (The fatalities mentioned above occurred in trials for different drugs.)3
One interesting aspect of the FDA approval announcement has to do with managing these side effects. As part of the announcement, the FDA also expanded the existing approval of Actemra® (tocilizumab) to now also treat CAR T-cell-induced severe or life-threatening CRS in patients 2 years old or older.1
Actemra is a biologic drug that is ordinarily used to treat moderate to severe rheumatoid arthritis (RA). It works by reducing, or suppressing, inflammation that accompanies the immune response.7
Suppressing the immune reaction can help ease the symptoms of CRS. The FDA confirms that in clinical trials in patients treated with CAR-T cells, 69% of patients had complete resolution of CRS within two weeks following one or two doses of Actemra.1
The FDA will require that hospitals and their associated clinics that dispense Kymriah be specially certified to recognize and manage CRS and neurological events.1 To support this accreditation step, Novartis plans to restrict Kymriah’s initial roll-out to 30–35 accredited treatment centers in the U.S. for the first six to twelve months.3
Costs will be high
First we should note that CAR T therapies will almost certainly be considered specialty medications, given their extremely dangerous potential side-effects. Under most benefit plan designs, specialty medications that require extensive medical supervision are typically paid for under the terms of the medical benefit.
With that in mind, we know that on the same day that the FDA approval was announced, Novartis disclosed that Kymriah will have a list price of $475,000 for a one-time treatment.2 This price, while somewhat lower than the highest predictions, is still very high.8 As such, this price point seems to support research looking at other drugs aimed at such small patient populations: The smaller the population, the higher the cost.
This phenomenon is most evident in the category called orphan drugs.
Orphan drugs are those that are aimed at diseases with fewer than 200,000 affected persons.9 While Novartis has not applied for orphan status with Kymriah, ALL affects only about 3,100 children each year, placing it squarely within the orphan category.1
One recent study of certain orphan drugs found that all drugs aimed at populations under 25,000 were priced at $400,000 per year or more – up to nearly $1 million dollars per year.10 We’ll return to the orphan concept in a moment.
Novartis also announced that it is collaborating with the Centers for Medicare & Medicaid Services (CMS) on a unique outcomes-based pricing model. This model allows payment only when pediatric and young adult ALL patients respond to Kymriah by the end of the first month. If they don't respond to treatment, Novartis won't be reimbursed.2
This is a significant departure from the usual drug launch strategy. Obviously, we can hope that the new outcomes pricing experiment turns out well, not just for CMS, but for Novartis, which might lead the way for additional outcomes-based arrangements.
Small market – at first
Price aside, Kymriah’s effect on overall health costs should be relatively small, at least at first. Kymriah’s approval is limited to just one cancer, and for use only as a last resort when all else has failed. As a result, only a few hundred patients per year would be eligible to use it.11
But the CAR T class is just getting started. Research is proceeding in the hope of using CAR T therapy in a larger number of cancers, and Novartis is by no means the only manufacturer in the hunt. For example, Kite Pharma, (which just recently announced its acquisition by Gilead) is waiting for its own CAR T approval from the FDA.8
Both Novartis and Kite/Gilead are working toward treatments for certain types of non-Hodgkin lymphoma that represent far larger patient populations than ALL.6 Based on National Cancer Institute statistics, there may be over 800,000 people living with non-Hodgkin lymphoma in the U.S.in 2017.12
Non-Hodgkin lymphoma is much more common than ALL. One particular type (diffuse large B-cell lymphoma), is the most common type of non-Hodgkin lymphoma in the United States, accounting for about 1 out of every 3 lymphomas.13
This is where previous experience with orphan drugs may give cause for concern.
By definition, orphan drugs are aimed at very small target populations. The problem is that once the high initial price is set, based on the original small population base, the price does not come down once the target population expands.14
From a payer’s perspective, this is the true nightmare scenario. Consider the math: Treating even a fraction – say, 10% – of an 800,000 patient population at $475,000 a piece would cost $38 billion.
Of course we need to remember that the $475,000 price is for a one-time dose. Many chemotherapy therapies can cost $100,000 per year, and last for multiple years. This example is only trying to highlight the difference between the initial, quite limited, indication for Kymriah, and the much larger potential market for all CAR T drugs.
Another hoped-for expansion of CAR T is to be able to use this therapy on solid tumors. Here there is some skepticism, since the modified proteins used in CAR T can only bind to antigens on the surface of a cancer cell. However, the overwhelming majority of solid tumor antigens reside inside tumor cells, out of the reach of CAR T.4
Accordingly, research on CAR T cells is continuing mostly in patients with blood cancers, including leukemia and multiple myeloma. To give some indication of scale, the number of clinical trials testing CAR T cells has expanded from just a handful five years ago to more than 180 today, with more on the way.4
The announcement that Gilead is to buy Kite Pharma is already raising concerns about what that combination might mean for pricing in the CAR T class. Several observers have pointed out that the situation now is similar to when Gilead acquired Pharmasset, the company that originally developed Sovaldi®, the huge-selling hepatitis C drug — worth $14.8 billion in 2016.8
The concern is that not only will Gilead need to fund the acquisition cost for Kite Pharma, they now also need to replace the Sovaldi income stream, as Sovaldi sales drop off in the face of increasing competition and a decline in the pool of eligible HCV patients. That could mean higher prices.8
However, since Novartis was first to market with Kymriah, Gilead will need to factor their second-mover status into any future drug pricing strategies – as will all of the players in this class.
The Gilead/Kite Pharma deal is expected to close in the fourth quarter of 2017.8
Thinking-through some cost implications
On balance, the news regarding pricing and potential spending for both Kymriah and CAR T in general is, frankly, mixed. On the plus side, Kymriah’s list price, while quite high, could easily have been set much higher, and yet still lie within the price range established for drugs aimed at such small markets.10
In 2016 immunotherapy drug sales reached an estimated seven billion dollars in the U.S.15 But going forward, the numbers start to mount quickly. As the treatment of cancer patients undergoes drastic changes over the next decade, the total cancer immunology market is projected to be worth approximately $14 billion by 2019, rising to $34 billion by 2024 – a 386% increase.16
Managing rapid innovation
Kymriah does appear to offer new hope for ALL patients who previously had few, if any options. Further, CAR T therapies may be on the verge of additional treatments and outright cures that only a few years ago would have been impossible.
As these new drugs grow closer to widespread use, we will already have a plan in place to draw on the appropriate techniques for your plan or your clients’ plans.– Michael Zeglinski, Senior Vice President, Specialty Pharmacy for OptumRx and BriovaRx
Lifting our eyes from the ground in right front of us to the horizon, we should treat the new CAR T drugs, and cancer immunotherapy in general, as just the leading edge of an onrushing revolution in medicine. Already, researchers are speculating that the old drug-development model, with carefully sequenced phase 1, phase 2, phase 3 trials, may be becoming obsolete.17
Our growing knowledge of the underlying of the molecular and cellular basis of diseases and their treatment could allow us to conduct new, “adaptive” drug trials that “flex” in response to incoming data in real time. Among other developments, we may soon see new therapies, delivering better treatments coming to patients much faster than before.17 In turn, this will make it ever-more critical that we have sound, well-thought-out management strategies.
As with any new drugs, while CAR T drugs may provide a substantial benefit over available therapies, they will require careful controls in order to ensure their most effective use. We asked Michael Zeglinski, Senior Vice President, Specialty Pharmacy for OptumRx and BriovaRx for his thoughts on how this process will unfold. He said: "OptumRx and BriovaRx specialty pharmacy programs are especially well-equipped with a wide range of management tools and strategies. As these new drugs grow closer to widespread use, we will already have a plan in place to draw on the appropriate techniques for your plan or your clients'plans."
Your OptumRx representative will keep you informed about these developments.
- FDA News Release. FDA approval brings first gene therapy to the United States. August 30, 2017. Accessed at: https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm574058.htm
- Bioentrepreneur. First approval in sight for Novartis’ CAR-T therapy after expert panel vote. July 15, 2017. Accessed at: http://blogs.nature.com/tradesecrets/2017/07/15/first-approval-in-sight-for-novartis-car-t-therapy-after-expert-panel-vote on 08.25.2017.
- National Cancer Institute. CAR T Cells: Engineering Patients’ Immune Cells to Treat Their Cancers. Updated: August 7, 2017. Accessed at: https://www.cancer.gov/about-cancer/treatment/research/car-t-cells on 08.28.2017.
- STATNews. Experimental cancer therapy holds great promise — but at great cost. Aug. 23, 2016. Available at: https://www.statnews.com/2016/08/23/cancer-car-t-side-effects/ Accessed 08.28.2017.
- Business Insider. A cancer treatment that one expert called the 'most exciting thing I’ve seen in my lifetime' just got closer to approval. July 12, 2017. Accessed at: http://www.businessinsider.com/fda-panel-recommends-novartis-car-t-cancer-treatment-2017-7 on 08.25.2017.
- Drugs.com. What is Actemra? Last reviewed: May 30, 2017. Accessed at: https://www.drugs.com/actemra.html on 08.30.2017.
- Kaiser Health News. ‘Breakthrough’ Leukemia Drug Also Portends ‘Quantum Leap’ In Cost. August 23, 2017. Accessed at: http://khn.org/news/breakthrough-leukemia-drug-also-portends-quantum-leap-in-cost/
- Washington Post. Gilead’s $11.9 billion purchase of a groundbreaking cancer therapy could drag it into a new debate on prices. August 29, 2017. Accessed at: https://www.washingtonpost.com/news/wonk/wp/2017/08/29/gileads-11-9-billion-purchase-of-a-groundbreaking-cancer-therapy-could-drag-it-into-a-new-debate-on-prices/?utm_term=.b72edda15062
- Fortune. The Way We Treat Cancer Will Be Revolutionized As Gene Therapy Comes to the U.S. August 30, 2017. Accessed at: http://fortune.com/2017/08/30/fda-novartis-car-t-kymriah/.
- U.S. Food and Drug Administration. Developing Products for Rare Diseases & Conditions. Last Updated: March 30, 2016. Accessed at: http://www.fda.gov/ForIndustry/DevelopingProductsforRareDiseasesConditions/ucm2005525.htm on 09.01.2017.
- LifeSci Capital, LLC research report. Orphan Drug Pricing. Accessed at: http://www.lifescicapital.com/analysis/orphan-drug-pricing/ on 09.01.2017.
- American Cancer Society. Types of Non-Hodgkin Lymphoma. Last Medical Review: May 31, 2016. Accessed at: https://www.cancer.org/cancer/non-hodgkin-lymphoma/about/types-of-non-hodgkin-lymphoma.html.
- Medscape. Drug Companies 'Gaming' the Orphan Drug System. Dec. 29, 2015. Accessed at: http://www.medscape.com/viewarticle/856580 on 05.05.2017.
- National Institutes of Health, National Cancer Institute. Cancer Stat Facts: Non-Hodgkin Lymphoma. Accessed at: https://seer.cancer.gov/statfacts/html/nhl.html on 09.05.2017.
- Seeking Alpha. Cancer Immunotherapy Market: 2016 Takeaways And What To Expect In 2017. Dec. 9, 2016. Acessed at: https://seekingalpha.com/article/4029555-cancer-immunotherapy-market-2016-takeaways-expect-2017 on 09.01.2017.
- Drug Discovery & Development. Multi-Blockbuster Drugs Will Drive Immuno-Oncology Market to $34B. April 19, 2016. Accessed at: https://www.dddmag.com/article/2016/04/multi-blockbuster-drugs-will-drive-immuno-oncology-market-34b on 04.14.2017.
- Journal for ImmunoTherapy of Cancer. Cancer immunotherapy trials: leading a paradigm shift in drug development. Published online 2016 Jul 19. doi: 10.1186/s40425-016-0146-9. Accessed at: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4949883/ on 09.12.2017.
STATEMENT REGARDING FINANCIAL INFLUENCE:
This article is directed solely to its intended audience about important developments affecting the pharmacy benefits business. It is not intended to promote the use of any drug mentioned in the article and neither the author nor OptumRx has accepted any form of compensation for the preparation or distribution of this article.