Community-acquired pneumonia (CAP) is a significant cause of morbidity and mortality in the United States.1 CAP is the third leading cause of death worldwide and the sixth leading cause of death in the United States, with a mortality risk that is greatest among elderly patients and those with comorbidities.2-4 CAP places a substantial clinical and economic burden on healthcare systems, particularly if hospitalization is required.5-9 In the United States alone, the direct annual medical costs for CAP exceed $15 billion, of which more than 80% is a result of hospitalization.5-9 Most pneumonia is caused by bacteria or a virus; when caused by bacterial pathogens, it is classified as community-acquired bacterial pneumonia (CABP).10
The most common regimens for the treatment of hospitalized adults with suspected or documented CABP in the United States are ceftriaxone plus a macrolide therapy or levofloxacin monotherapy.11 Although this is congruent with current guidelines, there are growing concerns regarding these empiric treatments, as described below.12 The incidence of azithromycin resistance in Streptococcus pneumoniae, the most common cause of CABP, is as high as 40% in the United States.13,14 A 2014 study reported that nearly 40% of hospitalized adults with CAP who received ceftriaxone plus azithromycin did not have a successful clinical response, as defined by symptom improvement and clinical stability by day 4 of therapy.15 In addition, there is increasing recognition of the safety risks of treatment with fluoroquinolones.16-18 The US Food and Drug Administration (FDA) has updated the labeling of all fluoroquinolones with a warning about the serious risk for multiple disabling and potentially irreversible adverse reactions associated with their use.18
Omadacycline, an aminomethylcycline antibiotic with oral and intravenous (IV) once-daily formulations, was recently approved by the FDA for the treatment of adults with CABP.19 Omadacycline has activity against the most common CABP pathogens, including multidrug-resistant S pneumoniae.20-22 Omadacycline was noninferior to moxifloxacin in the phase 3, double-blind, randomized clinical trial of IV-to-oral omadacycline for the treatment of adults with CABP in the community.23 The adverse event rates were similar between the treatment groups, except for patients with Clostridium difficile infection, which occurred in 8 (2.1%) patients who received moxifloxacin and in none of those who received omadacycline.23
Because hospital reimbursement and antimicrobial stewardship programs are increasingly tied to quality, efficiency, and cost of care,24,25 we developed 2 healthcare decision-analytic models to estimate the potential cost-saving opportunities with omadacycline relative to ceftriaxone plus a macrolide therapy (in patients for whom a respiratory fluoroquinolone would not be suitable) among patients hospitalized with suspected or documented CABP. The first model examined the cost impact of shifting patients with suspected or documented CABP from the current standard of inpatient treatment with ceftriaxone plus a macrolide to inpatient IV omadacycline with early hospital discharge on oral omadacycline. Support for this analysis was based on studies across various infection types that demonstrated that antibiotics with IV and oral formulations can shorten hospital length of stay (LOS) relative to treatment regimens containing IV-only antibiotics, such as ceftriaxone plus azithromycin.26-28
The second model examined the cost impact of treating patients with suspected or documented CABP who have a low mortality risk score, based on the Pneumonia Severity Index (PSI) developed by Fine and colleagues,29 in the outpatient setting with omadacycline versus treatment in the inpatient setting with ceftriaxone plus a macrolide (where fluoroquinolone treatment was not advisable). The impetus for this analysis was a large database study that showed that more than 66% of patients hospitalized for CABP who received ceftriaxone plus a macrolide had PSI scores of ≤90 (PSI risk classes I-III) and an average hospital LOS of 5 to 6 days.30,31 On the basis of associated mortality rates, guidelines from the Infectious Diseases Society of America/American Thoracic Society suggest that patients with PSI risk classes I and II should receive outpatient treatment, and patients with PSI risk class III should receive treatment in an observation unit or with a short hospitalization.12 This presents an opportunity to shift the care for some patients from an inpatient setting to an outpatient setting with treatment that has an oral formulation.
Overall, we calculated the total cost of inpatient care with a decision model using the current standard of care—ceftriaxone plus macrolide therapy—and compared that cost to the total cost of care with first-line omadacycline, either starting with IV omadacycline in the hospital and switching to oral omadacycline, or starting with IV omadacycline in the emergency department and discharging the patient to home care with oral omadacycline. The sources of the costs are shown in Table 1 and in the Appendix Table. We then used a simple 1-way sensitivity analysis and varied the cost of omadacycline to determine the cost-minimizing price range compared with inpatient ceftriaxone treatment (ie, the standard of care). Finally, we varied the percentage of omadacycline treatment nonresponse at its current wholesale acquisition cost to determine the level of costly treatment nonresponse that would counterbalance its cost-saving potential (Table 1).
We used a deterministic framework from the US payer and health system perspectives to develop 2 conceptual healthcare decision models—an early hospital discharge model and a hospital-avoidance model—for patients with suspected or documented CABP. These models replaced the current standard of care (ie, empiric IV ceftriaxone plus azithromycin therapy, where fluoroquinolone treatment was not advisable) with omadacycline therapy (Figure 1 and Figure 2) and calculated the total cost of inpatient care.
The population for each model was adults with suspected or documented CABP who presented to the emergency department. We used deterministic versus probabilistic models because the causes of events are well-established. Deterministic models were also better suited for addressing the study objective, which was to estimate the cost impact of shortening hospital LOS or avoiding hospitalization when using a treatment that has IV and oral formulations relative to a comparator drug that is available only as an IV treatment. Furthermore, we did not have data on the patients’ future health status during their inpatient stays that would affect hospital LOS and subsequent postdischarge healthcare resource utilization. Also, no comparator data were available between omadacycline and ceftriaxone plus azithromycin to inform the assumptions required for a typical probabilistic model.
Early Hospital Discharge Model
The early hospital discharge model was developed to compare the costs associated with ceftriaxone plus azithromycin versus omadacycline (IV in hospital and discharge home with the oral formulation) among patients hospitalized with suspected or documented CABP and PSI risk class III or IV, which was stratified by Charlson Comorbidity Index (CCI) score (Figure 1). The sources for the costs are shown in Table 1 and in the Appendix (online). Two omadacycline treatment scenarios were considered, including a 1-day reduction in hospital LOS with omadacycline relative to ceftriaxone plus azithromycin, and a 2-day hospital LOS reduction with omadacycline relative to ceftriaxone plus azithromycin. These assumptions were derived from the results of a randomized clinical trial of adults hospitalized with CABP, which involved switching patients from an IV to an oral antibiotic regimen (ie, empiric therapy).31 All patients in this model were assumed to have received outpatient treatment for a 7-day course of therapy, after initial hospitalization.
The hospital-avoidance model compared the costs of inpatient ceftriaxone plus azithromycin treatment versus outpatient omadacycline treatment for patients who presented to the emergency department with suspected or documented CABP, as determined by a PSI score of ≤90 (risk classes I-III), and had few or no comorbidities (CCI score32 of 0-3). The sources of the costs are shown in Table 1 and in the Appendix.
In this model, all patients who received ceftriaxone plus azithromycin were assumed to have presented to the emergency department and to have received outpatient treatment with an oral generic antibiotic after initial presentation to complete a 7-day course of therapy per the Infectious Diseases Society of America/American Thoracic Society treatment guidelines for CAP.12
The 2 treatment scenarios (assumptions) that were considered for omadacycline (Figure 2) were (1) that patients received an IV loading dose of omadacycline and were sent home from the emergency department with oral omadacycline, and (2) that patients received treatment under observation status with IV omadacycline and were then discharged home with oral omadacycline. In both scenarios, omadacycline was assumed to be given for the entire 7-day treatment course.
Model Inputs and Outputs
The full list of items and associated costs considered in the models (ie, early hospital discharge and hospital avoidance) are shown in Table 1. Data from a retrospective, observational study that used hospital discharge data from the Vizient Clinical Research Database (formerly the MedAssets database; see Appendix) were used as the input for the hospital LOS associated with inpatient treatment for suspected or documented CABP with ceftriaxone plus azithromycin, and to derive the costs of emergency department or observation unit stays for patients with CABP and the IV administration of antibiotics in the outpatient setting; these costs were derived from facility charges using cost-to-charge ratios.30
Patients were included in this study if they were aged ≥18 years, had a primary diagnosis of CABP, and received ceftriaxone plus azithromycin on hospitalization day 1 or 2 during their earliest hospitalization for suspected or documented CABP in the database between July 1, 2012, and June 30, 2015.30 In this study, the hospital LOS was stratified by the PSI risk classes.29 Because clinical laboratory values were not available in the Vizient database, the PSI score was derived, in part, from the International Classification of Diseases, Ninth Revision, Clinical Modification diagnosis codes.30 The median hospital LOS in the Vizient database for patients with CABP who received combination therapy with ceftriaxone plus a macrolide was 5 days in those with PSI risk class III and 6 days in those with PSI risk class IV.30
The hospital daily cost was estimated to be $2273, based on a previous study by Kozma and colleagues.33 The inpatient treatment costs associated with each decision arm, when applicable, were calculated by multiplying the cost per day by the mean hospital LOS. The wholesale costs for ceftriaxone, azithromycin, and oral step-down agents after discharge were obtained from the RED BOOK pricing database.34 In the omadacycline arm, the average daily costs of omadacycline were varied in a 1-way sensitivity analysis from $0 to $1000 per day, and the average daily omadacycline costs were assumed to be the same for the IV and oral formulations. The cost of omadacycline loading doses was not considered in the model and was assumed to be part of the average daily cost. No differences in efficacy, adverse events, and hospital readmissions between ceftriaxone plus azithromycin and omadacycline were assumed, given the lack of comparator studies between omadacycline and ceftriaxone plus azithromycin.
For the early hospital discharge model, the goal was to define the upper range of the average omadacycline daily acquisition cost that still conferred cost-savings with 1- or 2-day hospital stay reductions relative to inpatient treatment with ceftriaxone plus azithromycin.
The objective for the hospital-avoidance model was to characterize the upper range of the omadacycline daily acquisition cost that still conferred cost-savings relative to inpatient treatment with ceftriaxone plus azithromycin.
This was a sensitivity analysis, and the average daily cost of omadacycline was set at different thresholds to determine the cost-savings relative to inpatient treatment with ceftriaxone plus azithromycin. For each scenario, we also determined the proportion of patients who can receive omadacycline in the outpatient setting and subsequently be admitted to the hospital while still conferring cost-savings. For this analysis, the average daily costs for omadacycline were set at $450 per day (based on the current wholesale acquisition cost for omadacycline), and it was assumed that patients would receive 7 days of omadacycline treatment before subsequent hospitalization. The costs of hospitalization for patients who received omadacycline were assumed to be identical to the costs of the inpatient treatment of patients with suspected or documented CABP who received ceftriaxone plus azithromycin.
In the early hospital discharge model, from the payer or healthcare system perspective, omadacycline treatment resulted in cost-savings with a 1-day reduction in hospital LOS if its average daily cost was ≤$349. Omadacycline treatment led to cost-savings with a 2-day reduction in hospital LOS if its average daily cost was ≤$836 (Table 2).
In the hospital-avoidance model, the 2 omadacycline treatment scenarios that were alternatives to ceftriaxone plus a macrolide inpatient treatment included omadacycline IV load in the emergency department and discharge to home with oral omadacycline, and IV omadacycline in the observation period for up to 2 midnights and discharge to home with oral omadacycline. At a daily hospital cost of $2273 for the treatment of CABP,33 the break-even omadacycline average daily cost was $1334 for scenario 1 and $1302 for scenario 2 (Table 3).
The sensitivity analyses showed that successfully switching an individual patient from inpatient treatment with ceftriaxone plus a macrolide to outpatient omadacycline treatment at an average daily cost of $450 was estimated to save more than $6800 per patient, depending on the use of the observation unit and the daily cost of omadacycline (see Appendix Table). It is estimated that up to 52% of patients who would receive omadacycline and would be discharged home from the emergency department or the observational unit could be subsequently admitted and still maintain budget neutrality at an average daily acquisition cost of $450 (Figure 3).
Two important clinical and economic points that should be considered in the management of patients with suspected or documented CABP are the initial site of care (ie, outpatient vs inpatient) and the hospital LOS among admitted patients.4,7,35 The current treatment guidelines recommend that clinicians use site-of-care severity of illness indicators and other prognostic models to identify patients with suspected or documented CABP who may be candidates for outpatient treatment, given the substantially lower costs associated with outpatient management of patients versus inpatient care.12
Despite these recommendations, clinicians still tend to hospitalize a substantial proportion of low-risk patients with CABP, which can lead to unnecessary and costly hospital admissions.7,30,36 Even for low-risk patients, the average cost of a hospitalization was found to exceed $15,000 in a recent study of a large US hospital administrative database, with room and board costs accounting for the largest proportion of hospitalization expenses.7 More important, patients hospitalized for CABP often remain in the hospital after their acute infection resolves, despite the possibility of discharging them with continued oral antibiotic therapy without compromising their outcomes.28,37 Beyond the potential cost benefits, the early hospital discharge of appropriate patients with CABP would likely improve patient satisfaction, reduce hospital-associated infections, and allow resources to be reallocated to increase patient throughput and potentially reduce emergency department wait times.28,37
Cognizant of the increased focus on quality and efficiency of care,24 we devised 2 decision-analytic models to assess the potential cost-saving opportunities of using antibiotics with IV and oral formulations, such as omadacycline, by avoiding hospitalizations and reducing hospital LOS compared with inpatient treatment with ceftriaxone plus a macrolide, when fluoroquinolone treatment is not advisable. We selected the combination of ceftriaxone plus azithromycin as the comparator, because it is the most frequently used empiric antibiotic regimen for hospitalized patients with suspected or documented CABP,11 and because of the large number of studies that demonstrate that antibiotics with IV and oral formulations, such as omadacycline, can shorten a hospital stay compared with treatment with antibiotic regimens that have IV-only formulations, such as ceftriaxone plus azithromycin.26-28 Because fluoroquinolones are available as IV and as oral formulations, it was prudent to specify that these models only pertained to patients in whom a fluoroquinolone is not a suitable option.
Instead of specifying different daily costs of therapy or total treatment costs that are conventionally presented in studies such as ours, we sought to identify the upper range of the average omadacycline daily acquisition cost that still conferred cost-savings relative to inpatient treatment with ceftriaxone plus azithromycin. Our aim was not to define the daily acquisition cost of omadacycline or of any antibiotic of a similar nature. Rather, we were interested in quantifying the value proposition associated with omadacycline relative to inpatient treatment with ceftriaxone plus azithromycin, by standardizing its value in terms of the average daily costs of omadacycline versus the mean per-patient cost differences.
In the analyses that replaced the inpatient treatment of ceftriaxone plus a macrolide with inpatient IV omadacycline treatment and early hospital discharge with oral omadacycline to complete a 7-day course of therapy, the cost-minimizing daily threshold for omadacycline was $349 for a 1-day reduction in hospital LOS and $836 for a 2-day reduction in hospital LOS (Table 2). Although this threshold may be high, it is equal to the cost offsets with 1 or 2 fewer hospital days (as estimated by Kozma and colleagues at $2273 per day,33 averaged over 7 days).
In the analyses that considered managing low-risk patients with CABP in the outpatient setting with omadacycline versus ceftriaxone plus azithromycin in the inpatient setting, the observed cost-minimizing average daily thresholds for the 2 different omadacycline outpatient treatment scenarios were even higher than those associated with a 1-day reduction in hospital LOS. This is not surprising, given that the cost of outpatient treatment is considerably less than the cost of conventional inpatient care.4,7,35
With a hospital-avoidance approach, one of the major reservations among clinicians is the perception that patients will return to the hospital for subsequent care if they do not experience an early response to treatment (eg, stabilized disease or improving after at least 3 days of therapy), thereby negating all the cost-savings associated with outpatient treatment. Recognizing this, our models showed that up to 52% of patients who received treatment with omadacycline could return to the hospital for subsequent inpatient treatment after a 7-day course of omadacycline in the outpatient setting and cost-savings could still occur. Based on the results of the phase 3 clinical trial of omadacycline treatment in patients with CABP, we did not anticipate that many patients would require subsequent hospital-based care.23 The findings from our subsequent hospital admission analyses merely highlight that some patients can still be admitted, and substantial cost-savings can be conferred.
Several things should be noted when interpreting these findings. These healthcare conceptual models were developed to help understand the potential value associated with omadacycline treatment relative to inpatient treatment with ceftriaxone plus a macrolide where a fluoroquinolone is not a suitable treatment option. The proposed potential cost-savings opportunity with omadacycline treatment versus treatment with ceftriaxone plus a macrolide can be applied to any other empiric antibiotic that has IV-to-oral formulation capabilities. Furthermore, an oral-only treatment regimen of omadacycline for CABP has not been clinically tested, and patients in the CABP clinical trial23 received 3 days of IV omadacycline treatment before switching to oral omadacycline (which is not the same as the “IV loading dose and discharge with an oral formulation” scenarios proposed in our model).
The PSI risk score validation studies indicate that patients with a PSI risk score of ≤90 can often receive antimicrobial (IV or oral) treatment safely in the outpatient setting,12,38 which applies to our model of omadacycline utilization in the outpatient setting for appropriate patients. It should be emphasized that avoidance of hospitalization in favor of outpatient treatment for appropriate low-risk patients (ie, PSI risk score ≤90) would result in the most dramatic per-patient cost-savings.
Institutions that are seeking to improve the quality and efficiency of healthcare delivery for patients with CABP should not assume that this can be accomplished with an antibiotic, such as IV or oral omadacycline, alone. Although data show that hospitalized adults with suspected or documented CABP, on average, are typically discharged 2 days after achieving a clinical response,15 this is not always the case. One study demonstrates that the implementation of institutional pathways and healthcare provider education are often required to facilitate early hospital discharge in clinically stable patients with CABP who can tolerate oral therapy.31 In addition, changes in models that address reimbursement for the total cost of care (eg, bundled payments) may also be required to facilitate hospital avoidance and early hospital discharge of appropriate patients with CABP.
Our models assumed that omadacycline would be introduced as a first-line treatment for CABP. However, it is likely that, as with most new antibiotics, hospitals may limit its use to second-line treatment because of cost. In this case, the IV and oral formulations of omadacycline may still enable subsequent reduced hospital LOS after nonresponse to first-line treatment or slow response.
Another reason that hospitals may restrict the use of omadacycline as a first-line treatment is that the increased use of antibiotics, in general, can result in growing antibiotic resistance to the new agent; however, the same can be said regarding resistance and cross-resistance with current treatments.14 As such, we were deliberately conservative when designing the models and selecting the inputs.
This study has several limitations. We did not include treatment response rates, adverse events, or rehospitalization, because phase 3 comparative clinical trials of omadacycline versus ceftriaxone plus azithromycin for the treatment of CABP have not been performed.
We also did not consider the potential complications associated with the use of IV medications and extended hospitalizations as direct costs in our models. Furthermore, we did not factor in other indirect costs, such as those for subsequent outpatient follow-up, patient satisfaction, quality of life, and productivity measurements.
To date, omadacycline has been compared with moxifloxacin in a phase 3 clinical trial, and the volume of comparative real-world data with omadacycline in patients with CABP is not yet large enough for analysis to be statistically reliable, because omadacycline was only launched in the United States in the first quarter of 2019.23 For this reason, we created simple deterministic models that only associate outcomes with omadacycline that have been demonstrated with similar antibiotics that have IV and oral formulations in patients with CABP (ie, hospital avoidance and early hospital discharge).26-28,31
The major driver of cost in the early hospital discharge model was hospital LOS, and the model data to quantify the distribution of the hospital LOS by PSI risk class were derived from the Vizient database for hospitalized adults who received ceftriaxone plus a macrolide for suspected or documented CABP.30
An important clinical and economic consideration in the management of patients with suspected or documented CABP is the initial site of care (ie, outpatient vs inpatient setting) and the LOS among hospitalized patients. Given the costs associated with inpatient management of suspected or documented CABP, more structured approaches are needed to triage low-risk patients better to outpatient treatment and facilitate a more rapid response to hospital discharge of hospitalized patients with stable CABP.
Clinicians should consider alternatives to the use of ceftriaxone plus azithromycin for patients with suspected or documented CABP in whom a fluoroquinolone is not a suitable option, particularly among low-risk patients who are admitted to the hospital but can potentially be managed in the outpatient setting. Furthermore, because IV-to-oral antibiotics have been shown to reduce hospital LOS in previous studies, hospitals and health systems that aspire to minimize costs, by avoiding or reducing hospital LOS without compromising outcomes, should determine if the replacement of ceftriaxone plus azithromycin with an agent such as omadacycline for patients with suspected or documented CABP can confer cost-savings.
This study was funded by Paratek Pharmaceuticals.
Author Disclosure Statement
Dr Lodise is a scientific adviser and consultant to, and Dr LaPensee is an employee of, Paratek Pharmaceuticals.
Dr Lodise is Professor, Albany College of Pharmacy and Health Sciences, NY; Dr LaPensee is Director, Health Economics and Outcomes Research, Paratek Pharmaceuticals, King of Prussia, PA.
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