Economic Burden of Toxicities Associated with Treating Metastatic Melanoma in the United States

June 2016 Vol 9, No 4 - Business
S. Pinar Bilir, MS
Health Economics and Outcomes Research
IMS Health
San Francisco, CA
Qiufei Ma, PhD
Senior Manager
Thousand Oaks, CA
Zhongyun Zhao, PhD
Thousand Oaks, CA
Elizabeth Wehler, MPH
Senior Consultant
Health Economics and Outcomes Research
IMS Health
Plymouth Meeting, PA
Julie Munakata, MS
Senior Principal
Health Economics & Outcomes Research
IMS Health
Fairfax, VA
Beth Barber, PhD
Executive Director
Thousand Oaks, CA
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BACKGROUND: Little has been reported on the costs of managing the adverse events (AEs) associated with current therapies for patients with regional or distant metastatic melanoma.

OBJECTIVES: To identify treatment-related AEs in patients with metastatic melanoma and to estimate the associated costs of treating these AEs in the United States.

METHODS: A cost-estimation study for AEs associated with treatment of metastatic melanoma was conducted from 2012 to 2013 by identifying grades 3 and 4 AEs through the use of a comprehensive search of drug labels and English-language, published phase 2/3 studies in PubMed, conference abstracts, and the National Comprehensive Cancer Network guidelines. Resource utilization for the management of each type of AE in the outpatient setting was obtained via interviews with 5 melanoma specialists in the United States. Unit costs for an AE associated with melanoma treatment in the outpatient setting were assigned using Medicare reimbursement rates to obtain these costs. Hospitalization and length-of-stay costs were estimated for each associated AE using the large national claims database Optum Clinformatics Data Mart for the period of July 1, 2004, to November 30, 2012.

RESULTS: The most common AEs associated with chemotherapies used for melanoma were neutropenia, vomiting, and anemia. The most common AEs associated with vemurafenib were cutaneous squamous-cell carcinoma or keratoacanthoma, rash, and elevated liver enzymes; the most common AEs associated with dabrafenib were cutaneous squamous-cell carcinoma and pyrexia. Trametinib was most often associated with hypertension and rash. The most common AEs with ipilimumab were immune-related diarrhea or colitis, dyspnea, anemia, vomiting, and, less frequently, hypophysitis. The most common grade 3/4 AE with talimogene laherparepvec was cellulitis. The highest treatment costs for an AE in the outpatient setting were for neutropenia ($2092), headache ($609), and peripheral neuropathy ($539). The highest mean inpatient costs for an AE were for acute myocardial infarction, sepsis, and coma, which ranged from $31,682 to $47,069. Colitis or diarrhea, cutaneous squamous-cell carcinoma, thrombocytopenia, hyponatremia, oliguria or anuria, hypertension, anemia, and elevated liver enzymes were associated with mean costs for hospitalization ranging from $19,122 to $26,861.

CONCLUSION: The costs of managing treatment-related AEs in patients with metastatic melanoma are substantial. Effective treatments with improved safety profiles may help to reduce these costs. Until real-­world evidence for the costs associated with treatment toxicity is available in the outpatient and inpatient settings, the costs estimated in this study can help inform decision makers about the cost-effectiveness of managing patients with metastatic melanoma.

KEY WORDS: adverse events, chemotherapy, cost analysis, cost of illness, dabrafenib, dacarbazine, drug-related side effects, interleukin-2, ipilimumab, metastatic melanoma, talimogene laherparepvec, temozolomide, toxicities, trametinib, vemurafenib

Am Health Drug Benefits.

Received December 17, 2015
Accepted in final form May 2, 2016

Disclosures are at end of text

Malignant melanoma is the sixth most often diagnosed cancer in the United States, with an annual increase of 1.4% between 2002 and 2012.1 As many as 10.4% of melanoma cases are diagnosed at an advanced stage.2 As melanoma continues to affect increasing numbers of individuals, the treatment options and the economic costs attributed to the healthcare system will require careful consideration.

The therapeutic options for regional or distant metastatic melanoma have expanded in recent years, with new treatments introducing varying mechanisms of action, including chemotherapies, immunomodulatory agents, BRAF inhibitors, and most recently, a MEK inhibitor.3 The chemotherapies approved by the US Food and Drug Administration (FDA) for melanoma include dacarbazine and temozolomide. Immunotherapies include interleukin (IL)-2, as well as ipilimumab, which operates via blocking the production of a protein that prevents T-cells from fighting tumors.4 A novel oncolytic virus immunotherapy, talimogene laherparepvec, was approved by the FDA in October 2015 for the treatment of patients with melanoma.5 The BRAF or MEK inhibitors vemurafenib, dabrafenib, and trametinib, and the combination of dabrafenib and trametinib are available for 50% of patients with the BRAF V600E mutation.6

Some of the current treatments are showing greater survival benefit than older treatments and have thus been readily adopted in the clinical setting.7 The programmed death ligand 1 inhibitors pembrolizumab and nivolumab were approved by the FDA in the second half of 2014, but were not available in 2013, when this study was conducted.8,9

The introduction of novel mechanisms of action with the newer treatment options has led to dramatically differing toxicity profiles among treatments. For example, although chemotherapy and IL-2 treatments are most likely to lead to hematologic adverse events (AEs), such as neutropenia or anemia, studies on BRAF inhibitors show higher rates of cutaneous AEs, including squamous-cell carcinomas and/or keratoacanthoma, and grade 3 or 4 AEs associated with MEK inhibitor treatment, including hypertension and rash.10-16 Treatment with ipi­limumab is associated with a number of grades 3 and 4 AEs, the majority of which are immune-related, and may involve the gastrointestinal, liver, skin, nervous, endocrine, ocular, or other organ systems.17 The most common grade 3 or 4 AE with talimogene laherparepvec is cellulitis.18

Although the toxicity profiles of treatments for melanoma have been assessed during clinical trials, the relative economic consequences of managing each type of AE and toxicity profile have not been thoroughly researched and are thus not well-known, particularly for the newer therapies. This study therefore explores the costs of managing the more common toxicities observed with any therapy to understand the economic burden associated with melanoma therapies in the United States.


This cost estimation study explored AEs associated with monotherapy agents approved by the FDA and/or referenced in the National Comprehensive Cancer Network guidelines for the first-line or second-line treatment of metastatic melanoma,19 as well as the novel oncolytic immunotherapy talimogene laherparepvec. Our study included the drugs dacarbazine, temozolomide, IL-2, ipilimumab, vemurafenib, dabrafenib, trametinib, and tal­imogene laherparepvec. We incorporated a phased approach, starting with the identification of toxicities (see below) and their incidence rates.

To estimate the costs of treatment-related AEs in patients who receive treatment in an outpatient setting, detailed interviews with 5 clinical melanoma experts were conducted in the spring of 2013 to determine the range of potential resource utilization required to manage the identified AEs when treated in an outpatient setting. Of these 5 clinical experts, 4 were associated with prominent cancer centers and 1 with a community hospital; all 5 hospitals or cancer centers were affiliated with academic centers.

The first 2 interviews were used to refine the questionnaire and to cluster the AEs by general treatment approach to facilitate the use of “proxy costing.” In proxy costing, a single AE from each cluster was identified as representative of the others, because of its similar expected magnitude of resource utilization, thus allowing subsequent interviews to be manageable in duration. After all of the interviews were completed, the resources cited by the clinicians were consolidated and the outpatient costs were determined from a public (Medicare) payer perspective.

After the outpatient cost estimation, the list of toxicities and rates was updated with newly available phase 3 AE data for talimogene laherparepvec and the combination of BRAF and MEK inhibitors. The ungrouped comprehensive list was used to estimate the inpatient costs for AEs that required hospitalization using administrative claims data from a large national US managed care health plan.

A comprehensive literature search was performed in late 2012 to identify relevant clinical studies to determine the associated AEs and rates per therapy among the treatment options for melanoma. This search involved PubMed, publicly available sources from relevant professional conferences (from 2010 and later), and materials referenced in drug prescribing information.

The search terms included the drug names dabrafenib, dacarbazine, ipilimumab, interleukin-2, temozolomide, trametinib, vemurafenib, and talimogene laherparepvec; “melanoma”; “clinical trial”; and “metastases,” “metastatic,” or “advanced.”

From the available monotherapy studies, 1 high-quality study for each therapy of interest was selected for each line of therapy per drug (ie, first-line, second-line, or when no second-line option was available, mixed-line). The criteria for study inclusion were (1) a preference for phase 3 studies over phase 2 studies, unless no phase 3 studies were available; (2) a large sample size (large size was preferred over smaller samples, although no specific size was required); and (3) the use of recommended dosing regimens (which was confirmed using drug prescribing information with clinician expert opinion for chemotherapies and IL-2).

The rates of grade 3 or 4 toxicities (defined by the National Cancer Institute’s Common Terminology Criteria for Adverse Events) reported in the studies were then extracted, and the AEs reported in <1% of patients across all studies were excluded from the analysis. Further exclusion of certain abnormal laboratory values from our toxicity list was based on a pilot interview, in which the clinician suggested that no active management of the laboratory value AE would occur. The final list of AEs was compiled into an interview guide by type of melanoma treatment to facilitate discussions with the 5 clinical experts regarding drug toxicity management and resource utilization.

The inpatient costs were estimated for AEs that were identified by International Classification of Diseases, Ninth Revision (ICD-9) diagnoses and occurred at least 5 times in the database, updating the toxicity list using official prescribing information in addition to key publications.10,14-17,20-27

For our study, 5 US-based melanoma clinical experts were interviewed to learn their approach to the management of each melanoma treatment–related AE in the outpatient setting. The experts were identified via clinical publications in the fields of advanced or metastatic melanoma or by melanoma society (eg, Society for Melanoma Research) or conference participation within the previous 3 years, and were further screened to require that they currently treat at least 10 cases of melanoma monthly (range, 10-100; median, 35). The 5 melanoma experts had practiced medical oncology between 10 years and 32 years.

During the interviews, the physicians were asked to describe how they would treat each grade 3 or 4 AE from the final toxicity list in the outpatient setting. The 5 physicians’ responses to the questionnaire were reviewed to ascertain a base-case approach. For AEs without a clear majority response (ie, at least 3 of 5 physicians in agreement) agreement between 2 of the 5 physicians was considered appropriate if the other responses differed. Different drugs that had the same indication were considered to represent agreement in treatment approach (eg, oral steroid therapy or oral antiemetic therapy, regardless of the specific drug). Any additional or different items mentioned by the 5 clinicians were recorded and were used to create low and high estimates for a sensitivity analysis calculation.

The unit costs for required resources identified by the 5 clinical experts were collected consistent with a public (Medicare) payer perspective, including all outpatient medications, procedures, and physician consultations. All costs are reported in 2014 US dollars; the outpatient unit costs were obtained in 2013 and were inflated to 2014 US dollars using the medical care Consumer Price Index.28 The outpatient procedure and consultation costs were from the Physician Fee Schedule provided by the Centers for Medicare & Medicaid Services (CMS) using the national payment amount.29

The laboratory costs were obtained from the CMS Clinical Laboratory Fee Schedule.30 The prescription drug prices, which were selected based on the minimum price per unit for the appropriate strength of treatment, reflected the wholesale acquisition costs from the Medi-Span Price Rx database.31 The unit costs were then applied to default resource utilization patterns to calculate the costs of outpatient treatment for each AE.

To estimate the inpatient costs, a database analysis was conducted using administrative claims data from the large national claims database Optum Clinformatics Data Mart (formerly the Ingenix Normative Health Information database) for the period of July 1, 2004, to November 30, 2012. This database contains data on commercially insured and Medicare Advantage enrollees comprising approximately 3.5% of the US population, and includes approximately 14 million members annually. The member coverage is diverse, reflecting the geographic distribution of the nationwide health insurer, and is similar to the US census age distribution for sex and age-groups <65 years.

Medical claims and demographic and enrollment information were assessed for this study. The medical claims were collected from all healthcare sites available in the data set and included diagnosis and procedure codes recorded with ICD-9 Clinical Modification (ICD-9-CM), Current Procedural Terminology codes, or Healthcare Common Procedure Coding System; site-of-service codes; and the total paid amounts.

To be eligible for inclusion in the study, patients had to have at least 1 inpatient or 2 outpatient diagnosis codes for melanoma (ICD-9-CM: 172.xx, V10.82) or for metastatic melanoma (ICD-9-CM: 196.xx-198.xx) within the identification period (July 1, 2004-November 30, 2012).

The first metastasis date was required to be no more than 30 days before, or any time after, the first date of a melanoma diagnosis, and the index date was the first date of a diagnosis of metastases. Patients who had other primary malignant tumors before being diagnosed with melanoma and who were aged <18 years at the index date and had a preindex period of <6 months or a postindex period of <1 month were excluded from the analysis. Patients included in the study were followed from the index date to death, disenrollment, or the end of the study (December 31, 2012), whichever occurred first.

The main outcome measures investigated in this analysis were length of hospital stay (in days) and inpatient cost (in 2013 US dollars) per the occurrence of an AE. The final results were inflated to 2014 US dollars using the medical care Consumer Price Index.28 All postindex hospital admission records were examined to identify hospitalizations for selected AEs based on primary discharge diagnoses corresponding to each of the selected AEs.

This reflects the assumption that the costs of managing a specific AE in the patient population with metastatic melanoma would be the same, regardless of the cause of the AE. The average length of stay and cost per hospitalization were calculated from the total number of hospitalization records for every AE. Inpatient costs included were accrued during hospitalization when patients were receiving hospital care with a primary discharge diagnosis that was related to the selected AEs.

The cost categories included facility inpatient claims costs, professional claims costs, or other ancillary costs during the hospitalization period. The inpatient costs were computed as the combined health plan and the amount the patient paid, and were then adjusted using the annual medical care component of the Consumer Price Index to reflect inflation between 2004 and 2013. The results of the analyses are presented descriptively as mean and median values. To be analytically meaningful, we only studied AEs with data for more than 5 inpatient stays.


The literature search led to 45 publications on therapies for preliminary consideration, and from which the final publication selections were made. Phase 3 trials were published for all the drugs being considered, but phase 2 results were only included when the study was the only option available with a clear line of therapy (ie, the first-line use of ipilimumab,13 and the second-line use of IL-2 and vemurafenib12,16). Of the 45 articles, we selected 1 high-quality study that met the selection criteria outlined above and reported severe AEs for each drug for each line of therapy for a total of 10 studies (Table 1).10-17,32

From the 45 publications, we identified 30 severe (ie, grade 3 or 4) AEs for consideration in this study. In the outpatient treatment setting, resource utilization patterns suggested that some AEs required a similar approach to or similar magnitude of treatment. These AEs were grouped together (Table 2),10-17,32 and the most clinically significant AE chosen to serve as a proxy for the others in the group; the total outpatient management costs were estimated only for this toxicity.

Table 1

Table 2

For the inpatient cost analysis, additional AEs identified from the label of the combination of BRAF and MEK inhibitors were also considered. Overall, only AEs that were identifiable by ICD-9 diagnosis codes were included in the inpatient cost analysis.

Among chemotherapy regimens, the most common grades 3 and 4 AEs included neutropenia, vomiting, and anemia.11 Cutaneous squamous-cell carcinoma/keratoacanthoma, rash, and elevated liver enzymes were the most common AEs associated with vemurafenib,15,16 whereas cutaneous squamous-cell carcinoma and pyrexia (fever) were the most common AEs with dabrafenib.10 Trametinib was associated with hypertension and rash; immune-related diarrhea/colitis, dyspnea, anemia,14 and vomiting were the most common AEs with ipilimu­mab.13,17 Less often, patients receiving ipilimumab also experienced hypophysitis.13,17 The most common grade 3 or 4 AE seen in the phase 3 study of talimogene laherparepvec was cellulitis.18 The cohort demographics for this inpatient analysis are reported in Table 3.

Table 3

The costs for the management of AEs treated in an outpatient setting are listed in Table 4, and the inpatient costs are shown in Table 5. The costs were calculated based on the Medicare Physician Fee Schedule, Lab Schedule, and Medi-Span Price-Rx database, with the Consumer Price Index inflation being used as needed.

Table 4
Table 4b

Table 5

Among the common toxicities associated with melanoma therapies, the highest cost per incident in the outpatient setting was for neutropenia ($2087.69), followed by headache ($609.28), peripheral neuropathy ($539.08), cutaneous squamous-cell carcinoma ($377.97), and dyspnea ($227.01).

Hospitalizations resulting from acute myocardial infarction and sepsis incurred the longest median length of stay (9 days and 6 days, respectively), followed by acidosis (5.5 days), acute kidney failure, pneumonitis, neuropathy, thrombocytopenia, and oliguria/anuria (all 5 days). The highest inpatient cost per event was for acute myocardial infarction (mean, $47,069; median, $55,031), followed by sepsis (mean, $35,172; median, $23,384), coma (mean, $31,682; median, $23,702), acute kidney failure (mean, $31,213; median, $20,449), neuropathy (mean, $29,669; median, $12,322), and pneumonitis (mean, $28,330; median, $21,513). Colitis/diarrhea, cutaneous squamous-cell carcinoma, thrombocytopenia, hyponatremia, oliguria/anuria, hypertension, anemia, and elevated liver enzymes were associated with mean costs per hospitalization ranging from $19,122 to $26,861. By contrast, the lower mean inpatient costs per event were for cellulitis, fever, rash, and nausea, ranging from $14,043 to $17,230.


The costs to manage AEs resulting from metastatic melanoma treatments are significant, despite some variation in individual management approaches. When considering only the resources administered or recommended by a medical oncologist (ie, omitting resources required for continuing care by another specialist), the costs from a payer perspective ranged from the cost of an excess physician visit on the lower end, to the cost of an expensive inpatient stay on the higher end.

The least expensive melanoma treatment toxicities to manage include cellulitis, rash, and fever in the inpatient or outpatient settings. Managing elevated liver enzymes, palmar-plantar keratosis, hypertension, and fever or infection were likewise relatively inexpensive when treated in the outpatient setting, whereas neutropenia, headache, cutaneous squamous-cell carcinoma, peripheral neuropathy, and vomiting incur relatively higher treatment costs in the same setting. In the inpatient setting, acute myocardial infarction, sepsis, coma, acute kidney failure, neuropathy, and pneumonitis require more expensive treatment. Cutaneous squamous-­cell carcinoma could also become costly once an inpatient stay is required.

Overall, the costliest AEs to manage are those that require hospitalization or the use of expensive outpatient medications and/or procedures. Cutaneous squamous-cell carcinoma is associated with a relatively high cost for an outpatient treatment, because it requires an excision procedure. The cost of headache is also relatively high, because of the suggestion that a diagnostic magnetic resonance imaging would be performed.

A recent abstract reported the results of a US claims analysis that loosely corroborates our findings.33 Although that analysis used different AE categories, patients with metabolic or hemic/lymphatic claims in the 30 days after initiating treatment had costs that were approximately $8000 to $9000 higher than those without such types of claims.33 That analysis also found that cardiovascular, gastrointestinal, central nervous system/psychiatric, and pain-related claims led to excess costs in the $5000 to $6500 range, whereas skin-related claims led to no significant change in costs.33

Although our study was designed to demonstrate that managing AEs associated with melanoma treatments can be costly, the specific values presented in the study can be used in future analyses, including modeling to assess the overall burden of managing AEs over the course of each therapy. Although it was not covered in our study, a recent US retrospective database analysis investigated the total AE costs related to several melanoma therapies (ie, vemurafenib, ipilimumab, dacarbazine, paclitaxel, and temozolomide).34 Hemic and lymphatic disorders and effects produced the highest cost across all therapies. Among the therapies assessed, Chang and colleagues found that the adjusted mean AE costs were lowest for vemurafenib and highest for dacarbazine.34

There are differences between our analysis and these 2 retrospective database studies.33,34 For example, our analysis separates the outpatient costs from the inpatient costs per AE rather than provide a combined claims value. However, both of these analyses show that the costs per AE (or per category of AE) can require thousands of dollars in the United States, suggesting that a regimen with lower AE rates, together with less costly AEs, may provide clinical and economic value to patients with metastatic melanoma, to providers, and to payers.33,34


This study includes several limitations. Because pembrolizumab and nivolumab were not approved at the time of the study’s completion (December 31, 2012), they were not explicitly included in the toxicity costing; however, the comprehensive list assessed in this analysis already captures their typical AE profiles to a large extent, and therefore the overall analysis and conclusion would not change by their inclusion.

This is also true regarding combination therapy approaches, such as nivolumab plus ipilimumab,35 and in the outpatient analysis, dabrafenib plus trametinib.36 Although the rates of AEs differ with combination therapy, the only additional grade 3 or 4 AEs would include increases in alanine aminotransferase and aspartate aminotransferase levels and a decrease in ejection fraction, respectively. The conclusion of the study (that the previously identified AEs require significant management) would not change with the inclusion of these therapies.

The unit costs for outpatient services were based on Medicare reimbursement values, which are often lower than commercial health insurance reimbursement rates. This may have also led us to underestimate the outpatient costs for toxicities, yet this implies that the outpatient treatment estimates are conservative and the burden may be even larger than found in our study.

Furthermore, although the 5 clinical experts in our study represent a small sample that may not represent the nation’s practice patterns as a whole, there were no large deviations in management approach and overall costs across the 5 respondents; as providers in large cancer centers and 1 academic hospital, they provide examples of management approaches in current use.

For the inpatient analysis, the results must be interpreted in the context of the limitations of using administrative claims data. It is not possible to verify causality in claims data, and thus to confirm that claims are associated with drug-related AEs. However, the average cost as it appears in claims data represents the cost among the specific patient population for this event type, reflecting our assumption that the costs of managing a specific AE in the patient population with metastatic melanoma would not differ by the cause. It therefore can be considered a best-available cost from a claims data source.

In addition, the data are dependent on physicians and hospitals to accurately record any AE.

Finally, the patient population represented in the inpatient cost analysis are enrollees of a single, although large, commercial insurer in the United States and may not be generalizable to the entire US population, including patients with Medicare coverage.


This study provides an assessment of the economic impact of the toxicities associated with metastatic melanoma treatments. Based on this study, the identified AEs associated with melanoma therapies require significant management. Because of the very recent launch of some treatment options discussed in this article, it will be valuable to conduct a follow-up study in the future to assess the real-world evidence regarding the costs accruing from treatment toxicity in the outpatient and inpatient settings for metastatic melanoma. In the interim, the costs estimated in this study can help inform evaluations of the clinical efficacy and cost-effectiveness of managing patients with metastatic melanoma.

Funding Source
This study was funded by Amgen.

Author Disclosure Statement
Ms Bilir, Ms Wehler, and Ms Munakata have received research support from Amgen for this study. Dr Ma, Dr Zhao, and Dr Barber are employees of Amgen.


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Stakeholder Perspective
Reducing Adverse Events and Healthcare Resource Waste by Careful Selection of the Best Drug Therapy
James T. Kennedy, Jr, RPh, MBA
Specialty and Pharmacy Contracts
Harvard Pilgrim Health Care
Wellesley, MA

PAYERS/PROVIDERS: The management of patients with complex cancers and the selection of the appropriate drug therapy for them are critical challenges faced by providers and payers in today’s healthcare market. It is important to identify the most appropriate drug from a clinical perspective; however, the safety and tolerability of the medication also play key roles in the drug selection process. The risk–benefit assessment between efficacy and safety is often debated at the formulary committee level to identify the best drugs for classification as preferred medications. It is common to trade efficacy for safety when limited alternative treatment options are available. The risk for adverse events is often accepted as a necessary consequence of having limited options to treat a rare, recurrent, or treatment-resistant cancer.

The article by Bilir and colleagues in this issue highlights the variety of treatment options for melanoma and a number of distinct mechanisms of action.1 Health plans want to provide coverage for drugs with proved efficacy and prefer medications that have predictable outcomes related to diagnostic tools, targeted mechanisms of action, or substantial clinical data to support their use in the real world. A drug that fails to deliver clinical benefit to the patient is a waste of healthcare resources, and any adverse events that require treatment add significantly to this waste.

Although many adverse events can be treated with limited resources, the more severe cases that require hospitalization, medical procedures, or expensive drug therapy place financial stress on healthcare budgets. Many newer cancer drugs have average treatment costs that exceed $100,000 annually, and any additional costs related to adverse events need to be included in the cost analysis decision-making process of drug selection for treatment and formulary placement.

PATIENTS/PROVIDERS: Bilir and colleagues present a thoughtful and compelling overview of the costs of adverse events in patients with melanoma, as well as a wide range of risks.1 As shown in the article, the commercial costs for the adverse events will likely exceed Medicare rates; however, the relative difference in the costs of specific events would be comparable.1 Although a drug with a more severe adverse event profile is certainly less desirable from the patient and the provider perspectives, its efficacy cannot be ignored when selecting an appropriate treatment.

DRUG MANUFACTURERS/PAYERS: If a health plan accepts a drug for the formulary based on data from a clinical trial or other available data, the manufacturer should consider offering a guarantee about the risk of its adverse events. An outcomes-based contract that would protect the plan from excessive adverse event risk would be a welcome addition to the contract portfolio. A risk arrangement that would provide reimbursement to the plan for excess adverse events outside of the clinical data limits would increase the confidence in the value of the drug and would protect the plan from the financial hardship of treating higher rates of these occurrences.

We must accept the clinical data at face value for all new medications that were approved by the US Food and Drug Administration (FDA) based on carefully controlled clinical trials with relatively small numbers of patients. As health plans, we have an obligation to hold manufacturers accountable for clinical results that are significantly different from those presented in the original clinical profiles.

This article provides a framework for potential outcomes measures that could be used to develop a risk-based contract that would benefit the plan, and ultimately the patient, if we can identify the patients who are at increased risk for specific adverse events. I would encourage additional research in the area of real-world clinical results of oncology therapies, especially in the era of frequent breakthrough therapy status and priority review designations granted for new drugs approved by the FDA.

1. Bilir SP, Ma Q, Zhao Z, et al. Economic burden of toxicities associated with treating metastatic melanoma in the United States. Am Health Drug Benefits. 2016;9(4):203-213.

Last modified: June 27, 2016
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