More than a year after the landmark 21st Century Cures Act was signed prodding the government to evaluate use of real-world evidence, payers are weighing the role it can play to tamp down on high-cost treatments.
The bipartisan law mandated the Department of Health and Human Services create a program to evaluate the use of evidence gleaned outside randomized controlled clinical trials. The movement toward value-based care is spurring more life science companies to invest in the evidence.
Payers see their own opportunity, but some are still wary.
"When it comes to real-world evidence, especially for drug approval, there is a lot of skepticism about using less than the most rigorous randomized controlled trials," Steve Miller, Express Scripts' chief medical officer, told BioPharma Dive. "It is really about the quality of the data. When it comes to real-world sources, there is tremendous variability in the quality."
The pharmacy benefit manager has been involved in a number of payment models that use RWE. One involves a $850,000 gene therapy for a form of blindness sold by Spark Therapeutics Inc.
A study published in the Journal of Managed Care & Specialty Pharmacy found payers are still hesitant to share how they use RWE when making reimbursement or coverage decisions. While electronic health records, registries and claims data often informs how effective treatments are, "little is known about when and what types of real-world evidence studies inform pharmacy and therapeutic committee decisions."
More pharma companies are investing in RWE. More than half of those polled in a recent Deloitte survey said they are significantly boosting their activity in the space.
"This new regulatory opportunity — combined with the growing imperative for life sciences companies to demonstrate product value — is helping to drive commercialization strategies that result in broader insurance coverage, optimal pricing, and optimal formulary placement," the authors of Deloitte's 2017 RWE benchmark survey wrote.
What is good RWE?
Payers haven't historically used RWE for coverage decisions because medical policy teams sitting on boards helping them make decisions have viewed such evidence far lower on the hierarchy, according to Gregory Daniel, deputy director of the Duke-Margolis Center for Health Policy.
A key challenge is a lack of standards to evaluate RWE studies, he added.
Miller said the data quality spans a wide spectrum. Pharmacy claims and laboratory results are reliable, but with the more subjective provider or patient-entered data, quality goes downhill.
The Food and Drug Administration is working on an RWE framework to guide industry, but they will have to consider the sources, methods applied to generate evidence, the regulatory and clinical context, and how the research community can standardize what is considered good RWE, according to Daniel.
"As FDA works on that over the next couple of years leading to a guidance, I strongly think that sort of effort would also help payers and other decision-makers think through the uses of real-world evidence. So it wouldn't surprise me if it becomes more prevalent in payer decisions too as more consensus is built around what constitutes high-quality data and then high-quality real-world evidence," Daniel said.
Payers understand that randomized clinical trials are slow, expensive and impractical for certain rare diseases. But they need to make sure they have quality evidence to point to when making a coverage policy, Mike Kolodziej, a former Aetna national medical director for oncology strategies, said in an interview.
"Payers have to be convinced that the data is accurate and that the population in whom the data exists is representative of the membership of their beneficiaries," Kolodziej said, now vice president and chief innovation officer at ADVI, a consultancy. "They don't want ineffective therapies that are toxic and expensive to be given to the rotation. So I think that's the line they're walking."
The bottom line is that while RWE will continue to take on greater importance, it will never fully replace randomized clinical trials.
"The reality is that real-world evidence is going to be another tool, but it is not going to be able to totally replace the tried and true methods," Miller noted.
How to pay for the most innovative and pricey medicines like gene therapy is pushing the movement along.
With Spark's gene therapy Luxturna (voretigene neparvovec), regional insurer Harvard Pilgrim agreed in principle with the biotech to tie payment for the treatment to measures of both short- and long-term effectiveness. Separately, Spark and affiliates of Express Scripts partnered on a contracting agreement whereby the payer's specialty pharmacy pays the upfront cost for Luxturna, rather than the treatment center.
"We believe that tying these to clinical outcomes is important because they have been priced to assume that they work every time. If you're going to get a premium price, you better be willing to stand behind it, and have what we view as almost a money back guarantee, so we are very supportive of that," Miller said.
Spark also said it is in discussions with the Centers for Medicare and Medicaid Services over a proposal to allow payers to spread payment over multiple years.
Novartis AG plans to work with CMS on its own outcomes-based approach that would result in payment only if patients respond to its $475,000 CAR-T cell therapy Kymriah (tisagenlecleucel) within a month of starting treatment.
"We're seeing movement and CMS was clearly part of the press releases for Novartis and then Spark Therapeutics," Daniel said. "So, it's showing that both private and public payers are sitting down with manufacturers to try to figure this out and how to do these payments. So that's increasing. And I see that continuing to increase.
But Miller cautioned that the questions of how, and critically when, to measure these clinical outcomes remain important to ask.
"The key is making sure that you put the look back in at the right time, when they looked at Kymriah for instance, they were looking at just a 30-day look back. It's probably too short to know if somebody is responding to the product," Miller said.
As payers expand their use of RWE to evaluate the performance of products once they have seen real-world performance, mechanisms to review old decisions must be put into place, according to Daniel Malone, professor at the College of Pharmacy and associate professor in Mel and Enid Zuckerman College of Public Health at the University of Arizona.
"That process of making decisions down the road, whether six months, a year, two, three, five years down the road is not as well formulated within most organizations. There is not a mechanism to say 'what decisions did we make five years ago and do we want to continue to support this technology, formulary placement or do we make some new decisions?'" Malone said.