Cost implications of growth in new cancer drugs in a comprehensive cancer center.

Abstract

112 Background: Rising costs of cancer therapies calls for strategizing towards sustainable care delivery models from a hospital planning, payer as well as policy-making perspective. This topic becomes increasingly significant as there is exponential growth of novel, high-cost immunotherapy drugs making it imperative for players to adopt and practice value-based oncology. Objective: This study aims to evaluate increasing trends in use of new and transformative cancer therapies, and associated drug costs in a comprehensive cancer center in Massachusetts. Methods: Study period was fiscal year (FY) 2015-2018. Utilization was defined by the number of patients receiving infusion and number of visits made by them to the center during the FY. Cost was defined as expense to hospital. Data source was hospital billing database. ASP (Average Sales Price) of drug was obtained from CMS website and was used as an indicator for cost per unit of the drug. Results: Top 10 drugs were identified based on total cost incurred in the study period and contributed to almost a third of center’s total cost. Over the three years, number of visits for these drugs grew up to 700% and treated patients grew up to 350%. Use of chemotherapy in isolation decreased from 35% of treated patients in FY15 to 26% in FY18, whereas its use in combination with immunotherapy increased from 22% in FY15 to 28% in FY18. Average drug cost to hospital per patient for the study period ranged as high as $120,000 (excluding non-drug treatment costs). Conclusions: While clinical value of the new cancer therapies is unquestionably significant, there is a dire need for policy-makers, providers and payers alike to pay continued attention towards its high cost implications as observed in this study and, continue striving towards establishing more sustainable pricing policies through alternative payment models.