Spending on anticancer drugs among Medicare beneficiaries: Analyzing predictors of drug expenditures

Abstract

ObjectiveTo evaluate the factors associated with Medicare spending on newly approved anticancer drugs in the US from 2012 through 2021. Patient and MethodsUsing a cross-sectional analysis, we searched US FDA new oncology drug approvals (2012-2021). We analyzed clinical attributes and institutional factors influencing the annual cost of new anticancer drugs in the US. Annual treatment cost was calculated based on average spending per beneficiary from the Centers for Medicare and Medicaid Services, with product factors sourced from the FDA’s annual New Drug Therapy Approval reports and drug package inserts at the time of approval. ResultsOver a ten-year period, 112 new anticancer drugs were approved, of which 97 met the study's criteria. A significant majority, 93%, received expedited development designations from the FDA. At the time of approval, 40% of these drugs had data on progression-free survival, and 19% on overall survival rates; 29% were first-in-class. The study found a significant relationship between the year of approval and factors associated with the size of the treatment population. No statistically significant relationship was found between the clinical value of a drug and its price. ConclusionsSpending on anticancer drugs by Medicare are predominantly determined by reference pricing and the size of the anticipated treatment population, without an association with therapeutic value. The study advocates for reforms in reimbursement mechanisms for drugs lacking comparator arms and greater transparency for patients treated with these drugs.