CAR-T cancer therapies look to be super-promising. They also look to be super expensive. They also are tough to administer with significant credentialling and training needed to safely use the therapies. Yescarta is a CAR-T therapy for non-Hodgkins Lymphona which promises intriguing results and has a significant caveat:
In the single-arm ZUMA-1 study, Yescarta demonstrated an objective response rate (ORR) of 82 percent and a CR rate of 54 percent. After 8.7 months of follow-up, 39 percent of the patients who initially experienced a CR maintained that status. The CAR T-cell therapy was approved with a boxed warning regarding cytokine release syndrome (CRS), a potential serious or severe side effect caused by the immune system attacking healthy organs, which occurred in 13 percent of patients in the trial….
All patients had disease that was resistant to chemotherapy and had received a median of three prior lines of therapy, with 54 percent resistant to two consecutive lines of therapy. Overall, 79 percent of patients had not received prior transplant of their own stem cells and had disease that was resistant to their most recently received line of chemotherapy. The remainder had disease that had relapsed within 12 months of receiving such stem cell therapy….
To address the risk of CRS and neurologic toxicities, the FDA approved Yescarta with a risk evaluation and mitigation strategy, which includes elements to assure safe use. Additionally, certification and training will be required before hospitals will be cleared to administer the T cell therapy. The required training will focus on identifying and managing CRS and neurologic toxicity.
These are very sick patients. Not every hospital that currently treats these patients will go through the training and certification process because there might not be enough patients to make it worthwhile.
Bloomberg has some recent details on the few hospitals that are certified to use this therapy:
Five people have received the treatment, called Yescarta, at the 15 cancer hospitals authorized to administer it in the U.S., the hospitals told Bloomberg. Waiting lists for the $373,000 treatment have grown to at least 200 people, shrinking only as some very sick patients have died…..
The total cost per Yescarta patient, when including hospital and doctors fees, will be well in excess of $575,000 and could reach $1 million, doctors said. Since hospitals have to buy the treatment at full cost from Gilead, most places are waiting to have insurer guarantees of reimbursement before moving ahead.
It is plausible that in regions where there are multiple centers that currently treat non-Hodgkins Lymphomas there may be only one or two places that can do the CAR-T treatment. This invites high pricing as competition between providers will be low if the only options are the local academic medical center or the academic medical center half a day drive away.
More interestingly (to me at least), is the invitation to play more network games for insurance companies attempting to screen and select their own risk. Mark Shephard has a paper that I keep on going back to as he describes how networks are used as screening and selection mechanisms. Networks are a critical aspect of insurer buyer’s choice:
I study the role of adverse selection when health insurers compete on an increasingly important benefit: coverage of the most prestigious (and expensive) “star” hospitals. Using data from Massachusetts’ pioneer insurance exchange, I show evidence of substantial adverse selection through a channel theoretically distinct from standard selection on medical risk. Plans that cover star hospitals attract consumers with high costs because when sick, they tend to use the expensive star providers. This selection persists even with risk adjustment, which does not offset higher costs driven by hospital choices rather than medical risk. I show evidence of adverse selection through this mechanism using consumer choices across plans that differ in star hospital coverage and using switching choices after a plan drops the star hospitals from network. I then estimate a structural model of insurer competition to study the welfare and policy implications of selection. I find that adverse selection creates a strong incentive not to cover the star hospitals.
If there are multiple insurers in a region that offer somewhat similar products where the only difference is whether or not a CAR-T hospital is in-network, people who are already sick and know that they may be on the pathway to needing a CAR-T treatment will choose the insurer that has the CAR-T hospital in network. Risk adjustment can help a bit but it is a lagging adjustment that usually pays an average cost of care and may not adjust for the specific hospital’s potentially higher baseline fee structure. There is a strong incentive for insurers selling individual level policies (Exchange, Medicare Advantage etc) to avoid hospitals with CAR-T certification.
Mathguy
These posts make me angry at our stupid, moronic health care system and all the built-in incentives for people to be assholes: “This invites high pricing as competition between providers will be low if the only options are the local academic medical center or the academic medical center half a day drive away.”
dr. bloor
I know this post is about insurance companies dealing with expensive patients, and won’t be a popular comment, but the bigger issue is being overlooked here: at what point is society (and its agents, i.e. hospitals and insurers) no longer obliged to allocate resources to very sick patients?
Health care rationing: the third rail that can bring down costs, and that no one wants to touch.
Starfish
Have you read anything about Spinraza yet? It is another drug that is going to cost close to a million dollars.
ThresherK
Hey, sorry but I’m going OT: Wilmer’s former press sec and others on a hunger strike about the DREAM act.
That’s great and all, but the upshoot is,
Is this totally the wrong target, or am I missing something here? Is anti-DREAM stuff being shoveled into the back-end of crappy (that goes without saying) GOP bills? Why Schumer? Is Curbelo vulnerable, or one of those R’s who gets fellated for being bi(partisan)-curious on this issue?
Starfish
@ThresherK: The people who are afraid of being deported over the DREAM act expect Democrats to support them. Juicers have treated this like a very unserious issue, but there were kids in my child’s school that had to be seen by the school psychologist after the election of Trump because they could not focus on school because they were afraid that they would be deported. And when stuff like this happens, their fears are perfectly legitimate.
If it takes letting a government shutdown to get a clean DREAM Act, the people who will suffer most when this is yanked away are perfectly willing to let it happen. What’s in it for Democrats to continue to fund a government with an executive that is basically corrupting every government institution?
Here are more details. These kids that went on a government list are going to be deported or just put in privately run prison camps starting in March.
ThresherK
@Starfish: Thanks. I’ve read some of the horror stories, but that still was useful.
Roger Moore
I don’t think this one drug is going to get many hospitals dropped from insurance plans, at least right away. That’s because it’s only going to be available at ridiculously high-end specialist cancer hospitals. At the moment, there are only 15 hospitals in the country licensed to treat patients with Yescarta, all of them NCI designated Cancer Centers*. Nobody is going to drop MD Anderson, Memorial Sloan Kettering, or Dana Farber because they’ve added one more expensive treatment, because they’re already going to be included only in expensive, broad network insurance.
*Full disclosure: my employer is one of the 15.
Cranky Old Scold
This is not a problem in Canada.
WereBear
Will no one ask WHY it is so freakin’ expensive? When they outsource the majority of their research and make enormous profits as it is?
Doug R
So sperm can be used to deliver cancer fighting drugs.
Is there anything sperm can’t do?
cat
@WereBear: The reason CAR-T is so freakin’ expensive is because it has to be custom-tailored to each patient. The technology to remove a patient’s cells, genetically modify those cells to fight cancer, and return them to the patient, while putting in as many safeguards as possible to prevent said modifications from killing the patient through a massive immune over-reaction or causing another cancer is time-consuming, requires significantly more specialized training than the production of traditional chemical compounds, and is only currently approved to be done in a scarce handful of laboratories across the country. And because it’s a very new technology, it has only been approved for use in a very narrow range of circumstances, making it infeasible to expand production to the extent that would lower cost.
If the FDA approves this type of therapy for other cancers, ideally the cost would go down as the therapy became more widely available. This is assuming the therapy doesn’t hit any unforeseen snags that would either cause it to be pulled or prevent approval for other applications.
Uncle Cosmo
A true (& cautionary) tale for you, David.
Standard operating procedure (SOP) in those proposals was to define all acronyms at first use – as illustrated. I highly recommend you do the same if you’re going to continue to pepper your FP posts with them; once that takes hold, I predict that more readers will stop to peruse the articles you take such time crafting, rather than scrolling on by because they seem incomprehensible.
WereBear
@cat: Got you, appreciate it.
AnonPhenom
Novartis has FDA approval for their Car-T therapy and they’re marketing it with an interesting hook…
So, whatever the market will bear … but with a money back guarantee. That’s different.
dr. bloor
@AnonPhenom: The money-back guarantee is vaguely worded, but it’s kind of a red herring in any case. The long-term market viability will hinge on whether it really undersells current leukemia treatments.