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Background Drug manufacturers claim that the purpose of financial payments to physicians is to facilitate education about new drugs. This claim suggests 2 testable hypotheses: payments should not be associated with drug revenue and payments for each drug should decline over time as physicians become educated. Materials and Methods We used open payments data on industry payments. We included payments for cancer drugs without generic/biosimilar competitors and used federal data sources to measure Medicare spending (a proxy for overall drug revenue) and a number of prescribers. We used generalized estimating equations (GEE) to model the drug-level association between industry payments and Medicare spending. Separately, we used GEE to estimate the change in payments with respect to the duration of time since initial FDA approval. Results The sample included 89 drugs and 361 drug-year observations. The total value of industry payments for oncology drugs increased, from $53 333 854 in 2014 to $90 343 731 in 2018. There was no association between log-transformed mean, per-physician industry payments, and per-physician Medicare spending (estimate −0.001, 95%CI, −0.005 to 0.004). Payments for individual drugs decreased over time; estimated payments in the subsequent year for a drug with mean, per-physician payments of $1000 in the index year was: $681* for drugs 0-4 years since approval, $825 for 5-9 years, and $679* for ≥10 years (* P <.05). Conclusions Although industry-sponsored education may also serve marketing purposes, the absence of association between industry payments and Medicare spending and the decline in payments subsequent to approval are consistent with claims that industry payments function to facilitate physician education. [ABSTRACT FROM AUTHOR]

In 2011, Bristol-Myers Squibb set the price of its newly approved melanoma drug ipilimumab-brand name Yervoy-at $120,000 for a course of therapy. The drug was associated with an incremental increase in life expectancy of four months. Drugs like ipilimumab have fueled the perception that the launch prices of new anticancer drugs and other drugs in the so-called 'specialty' pharmaceutical market have been increasing over time and that increases are unrelated to the magnitude of the expected health benefits. In this paper, we discuss the unique features of the market for anticancer drugs and assess trends in the launch prices for 58 anticancer drugs approved between 1995 and 2013 in the United States. We restrict attention to anticancer drugs because the use of median survival time as a primary outcome measure provides a common, objective scale for quantifying the incremental benefit of new products. We find that the average launch price of anticancer drugs, adjusted for inflation and health benefits, increased by 10 percent annually-or an average of $8,500 per year-from 1995 to 2013. We argue that the institutional features of the market for anticancer drugs enable manufacturers to set the prices of new products at or slightly above the prices of existing therapies, giving rise to an upward trend in launch prices. Government-mandated price discounts for certain classes of buyers may have also contributed to launch price increases as firms sought to offset the growth in the discount segment by setting higher prices for the remainder of the market. [ABSTRACT FROM AUTHOR]

The article discusses how copay assistance may further increase health care costs. Topics covered include the consistent growth in drug spending, the practice by pharmaceutical companies of offering coupons to offset patients' out-of-pocket costs, and the tendency for copay assistance to undermine benefit designs that enable low-cost insurance plans. Also mentioned are the policy changes that should be done to ensure that the equity of copay assistance programs is improved.

National spending on health care presents a central fiscal challenge for the United States. Expenditures for cancer care are expected to increase substantially because of a rapid rise in new cancer diagnoses associated with the aging of the population. In addition, innovations in cancer treatment are expected to increase spending on cancer care. To examine the drivers of rising cancer costs and to evaluate potential strategies to provide affordable, high-quality cancer care to all patients, the Institute of Medicine's National Cancer Policy Forum convened a workshop in October 2012, Delivering Affordable Cancer Care in the 21st Century. This article summarizes presentations and discussion from the workshop, and focuses on the practice-changing strategies that workshop speakers proposed to improve the affordability of cancer care while maintaining or improving the quality of care. [ABSTRACT FROM AUTHOR]

The steady introduction of more and more expensive cancer treatments has prompted policy makers to explore alternative payment approaches that might rein in costs. We propose a framework for "episode-based" payment during chemotherapy treatment, which would cover the costs of drugs and their administration for a predefined period of treatment and would have the potential to reduce costs and improve patient outcomes. Using the example of metastatic lung cancer treatment, we describe an approach that Medicare could pursue in order to test our proposal as a pilot program. If successful, the concept could be expanded to encompass longer time periods, other cancer diagnoses, and additional care components. [ABSTRACT FROM AUTHOR]

Medicare must find new ways to achieve cost control without limiting access to beneficial services. We propose a payment model incorporating comparative effectiveness research to encourage Medicare to pay equally for services that provide comparable patient outcomes. The model would include higher payments for services demonstrated by adequate evidence to provide superior health benefits compared to alternative options. New services without such evidence would receive usual reimbursement rates for a limited time but then be reevaluated as evidence emerged. In spite of the substantial political hurdles to changing Medicare reimbursement, efforts should be made to use comparative effectiveness research to reward superior services, improve incentives for cost-effective innovation, and place Medicare on a more sustainable financial footing. [ABSTRACT FROM AUTHOR]

The author discusses the rising costs of drugs and existing treatments amidst biomedical improvements, referencing the article "Nivolumab versus Everolimus in Advanced Renal-Cell Carcinoma" by R.J. Motzer and colleagues which appeared on page 1803 within the issue. Topics mentioned include the problem Medicare beneficiaries face when it comes to cancer care, the lack of upper limit on coinsurance, and cost-effectiveness analysis as a tool for identifying the value of different treatments.

A correction to the article "Personal Payments from Pharmaceutical Companies to Authors of Oncology Clinical Practice Guidelines" in a 2021 issue is presented.

In this Viewpoint, Peter Bach and colleagues distinguish 5 pricing reform proposals implied by the concept of value-based drug pricing and discuss the potential of each to ensure value in response to unsustainable drug price increases. [ABSTRACT FROM AUTHOR]

In this article, the author reflects upon the FDA's approval of Tisagenlecleucel, a drug used to treat cancer. Topics discussed include how the drug has been approved to treat acute lymphoblastic leukemia, how a one-time infusion of the drug costs $475,000 and details relating to the drug's black box warning as its use can cause hypotension, multiorgan failure and even death. Details relating to revenue outlooks for pharmaceutical companies including Novartis and Gilead are also offered.

The author discusses the differences between the prices for cancer in a physician's office and he hospital outpatient setting in the U.S. Topics include the efforts to consolidate physician's offices into hospitals, the impact of the 340B drug discount program on the prices of drugs charged by hospitals, and the Part B pilot proposal of the Centers for Medicare and Medicaid Services (CMS).

The author calls for an end to contradictory regulatory standards in the U.S. that allow drug manufacturers to improve profits by producing single dose vials containing quantities that increase leftover drug. Topics discussed include how big the problem is, how the drug quantity affects profits and waste, and how the waste can be stopped. A table of selected infused cancer drugs based on projected 2016 sales sold in single dose vials and dosed based on patient is presented.

The discussion of value has moved from the philosophical, in which “value” was held out as an amorphous “eye of the beholder” concept, to an operationalized construct that is now directly affecting prescribing decisions. This is appropriate, given the large differences in price that seem disassociated from value. [ABSTRACT FROM AUTHOR]

In recent years many policy makers have recommended alternative payment models in medical oncology in order to reduce costs and improve patient outcomes. Yet information on how oncology practices differ in their use of key service categories is limited. We measured annual payments for key service categories delivered to fee-forservice Medicare beneficiaries receiving care from 1,534 medical oncology practices in 2011-12. In 2012, differences in payments per beneficiary at the seventy-fifth-percentile practice compared to the twenty-fifthpercentile practice were $3,866 for chemotherapy (including administration and supportive care drugs), $1,872 for acute medical hospitalizations, and $439 for advanced imaging. Supportive care drugs, bevacizumab, and positron-emission tomography accounted for the greatest percentage of variation. Average practice payments for service categories were highly correlated across years but not correlated with each other, which suggests that service categories may be affected by different physician practice characteristics. These differences, even when clinical guidelines exist, demonstrate the potential for quality improvement that could be accelerated through alternative payment models. [ABSTRACT FROM AUTHOR]