Transition from Branded to Generic Cancer Drugs Significantly Increases Treatment Cost-Effectiveness

August 2016 Vol 9, Special Issue: Payers' Perspectives in Oncology - Value in Oncology
Chase Doyle

An economic analysis of oncology regimens that were previously evaluated in trials conducted by the Canadian Cancer Society Research Institute has shown that the transition from branded to generic drug costs has a considerable impact on the cost-effectiveness and cost-utility of treatment.

“Genericization of costly oncology drugs significantly improved the cost-effectiveness and cost-utility of treatment,” said Winson Y. Cheung, MD, MPH, FRCPC, Chair of Gastrointestinal Systemic Therapy, British Columbia Cancer Agency, Vancouver, Canada, at ASCO 2016.

With the rising cost of novel therapeutic agents in oncology, prospective economic evaluations, including cost-effectiveness and cost-utility analyses, are needed to facilitate the development of budget policies and to ensure that the costs of drugs are fair and transparent.

However, “cost information in economic evaluations is mainly based on the price of the branded drugs at the time of the analysis when the agents first enter the market. Revisiting an economic analysis with new cost data after the transition of a branded to a generic drug is rarely done, despite a typical significant cost difference between the drug categories,” Dr Cheung said.

Study Design and Results

Dr Cheung and colleagues reexamined the cost-effectiveness and cost-utility of regimens that were previously evaluated in Canadian Cancer Trials Group studies, incorporating new cost data of generic drugs and current resource utilization. The researchers also determined the acceptable cost levels of generic drugs that would make regimens reimbursable in a publicly funded healthcare system.

A total of 4 randomized controlled trials with 19,179 patients were reevaluated. Since the initial publication of these trials, generic versions of erlotinib, cetuximab, and cisplatin have been made available or are expected.

The availability of generic versions of vinorelbine ($386 from $12,006; all in Canadian dollars) and cisplatin ($218 from $17,872) significantly improved the cost-effectiveness and cost-utility of a chemotherapy regimen from $150,000 to $50,000 per life-year and quality-adjusted life-year (QALY) gained.

The genericization of erlotinib ($1460.25 per 30 days) resulted in an incremental cost-effectiveness ratio (ICER) of $45,746 per life-year gained compared with $94,638 for branded erlotinib.

Transitioning to generic cetuximab ($275.80 per 100 mg) produced an ICER of $261,126 per QALY gained in comparison with $299,613 for branded cetuximab. Decreases in the cost of generic cetuximab to $129.39 and to $63.51 would further improve the ICER to $150,000 and $100,000 per QALY, respectively.

According to data from the LY.12 trial, the genericization of cisplatin ($157.50 per 100 mg from $493.74) resulted in a reduced cost in the cohort receiving gemcitabine, dexamethasone, and cisplatin and in the arm receiving dexamethasone, cytarabine, and cisplatin by $441.32 and $488.42 per cycle, respectively.

“Failure to revisit economic analyses with costs of generics may be a missed opportunity for funding bodies to optimize value-based allocation of healthcare resources,” he said. “However, the current cost levels of generics may not be sufficiently low to sustain publicly funded healthcare systems.”

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Last modified: August 19, 2016
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