A Growing Cost Consciousness in Oncology

Diagnostics are improving.  The US population is aging. Patients are living longer. Pipelines are filled disproportionately with both large and small molecules targeted across numerous tumor types. An increased number of generically available cancer therapies and biosimilars are looming on the horizon. With all these factors at work, the United States healthcare system continues to focus on new ways to manage the escalating costs of treating cancer.  Recent examples of this intensification include the National Comprehensive Cancer Network (NCCN) partnership with the National Business Group on Health (NBGH) to develop An Employer’s Guide to Cancer Treatment & Prevention. The guide is intended to be a resource that can be readily applied to many aspects of the health benefit life cycle, including benefit planning and implementation; request for proposal (RFP) development, review, and scoring; vendor management; and plan administration and evaluation.   The various elements within The Guide planned for release are designed to help ensure benefit dollars for cancer are invested wisely and meet the needs of employees and their dependants.

Other examples include the growing use of clinical pathways as tools to manage cancer costs more effectively.  In October, The US Oncology Network released study results indicating that treating colon cancer utilizing clinical pathways has significantly lower cost while demonstrating outcomes similar to those in published literature.  Their first study in lung cancer, published earlier in the year, demonstrated similar clinical results and cost savings.  And just this month, The Medical Oncology Association of Southern California (MOASC) and Cardinal Health Specialty Solutions signed an agreement to work together to expand use of clinical pathways to improve the quality and costs of cancer care in Southern California.  In doing so, the two entities will also collaborate with managed care organizations to align reimbursement rates and incentives to fairly reimburse participating member physicians for improving the quality and cost-effectiveness of the care they provide to patients.

So what do these trends mean for the biopharmaceutical industry beyond the obvious cost scrutiny that therapies and interventions will be under?  Well, they mean that the industry must reassess its business approaches, marketing strategies, and clinical investments.  No other disease is treated in a more evidence-based, guideline-driven, but sometimes off-label manner, than cancer.  Health benefit planning, payer cost management approaches, and the proliferative use of clinical pathways all account for this reality.  And if regulatory policies governing marketing communications cannot be reevaluated and evolve to this systemic phenomenon, the industry’s ability to effect change the way NCCN, NBGH, The US Oncology Network, and Cardinal Health can will be severely compromised.  Within the context of current regulatory restrictions, greater investment in and use of medical to medical communications is a must, especially at the local market level, and these personnel should be required to have a deep understanding of market dynamics as identified above.  More market relevant and business savvy health economic and outcomes research will be required to demonstrate the value of brands.  And longer-term investments and approaches to marketing that foster industry-wide collaborations will be required to earn a seat at the table and the respect of well entrenched and emerging influential entities such as cancer center alliances, business coalitions, group purchasing organizations, healthcare management companies, medical oncology associations, and the payer community.

 

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