Indication-specific pricing discussed in Norway, NOMA approves Keytruda for reimbursement in NSCLC

The Norwegian health technology assessment (HTA) agency (Beslutningsforum) has rejected the idea of indication-specific pricing in the country. This means that where the same drug is used across a range of indications, the same pricing arrangements should apply; the agency had previously agreed to the principle of indication-specific pricing, but has now reversed course on the issue. In an article published by Dagens Medisin on 27 September, representatives of the HTA body noted that such arrangements were too complex to negotiate, and that controlling pricing contracts with manufacturers is a difficult undertaking.

IHS Markit Life Sciences previously reported Norway's drug-procurement agency (Legemiddelinnkjøpssamarbeidet: LIS) as stating that economic models submitted by pharmaceutical companies in reimbursement applications tend to underestimate the budgetary consequences of introducing new, high-cost innovative medicines. LIS specifically advocates in favour of flat-rate discount agreements with industry (see Norway: 18 April 2016: LIS drug-procurement agency advocates flat-rate discount agreements with industry). The guidelines issued by Beslutningsforum will establish a principle for future pricing negotiations related to discounts for the indications being evaluated, conducted by LIS.

Avastin (bevacizumab; Roche, Switzerland) is typically cited as an example of a product in which indication-specific pricing could be applicable, given its various and wide-ranging indications for the treatment of colon and rectal cancer, small cell lung cancer, and renal and cervical cancer, as well as off-label use in the treatment of age-related macular degeneration (AMD); LIS had been negotiating with Roche on a prospective discounted-price agreement based on indication specific prices. Earlier this week, the agency announced that it had failed to negotiate a price agreement for Avastin in a cervical cancer indication, which was primarily attributed to an indication-specific pricing arrangement; Norwegian authorities have said that they will assess Avastin again, in a cervical cancer indication, provided the price is lowered.

Elsewhere, the Norwegian Medicines Agency (NOMA) announced that it had granted reimbursement status to US firm Merck & Co's Keytruda (pembrolizumab) in non-small cell lung cancer (NSCLC), while simultaneously rejecting four other reimbursement applications.

Norway rejects reimbursement of PCSK9 inhibitor Praluent

On 25 September, NOMA announced a decision against reimbursing Sanofi/Regeneron (France/US)'s proprotein convertase subtilisin/kexin type 9 (PCSK9) inhibitor Praluent (alirocumab) for the treatment of adult patients with hypercholesterolaemia; the NOMA evaluation concluded that the monoclonal antibody was not sufficiently cost-effective versus a placebo. Sanofi had submitted a reimbursement application for Praluent, in combination with statins and Merck & Co's Zetia (ezetimibe), for the treatment of heterozygous familial hypercholesterolaemia (HeFH) in primary and secondary prophylaxis where adult patients had not achieved adequate low-density lipoprotein cholesterol (LDL-C) reductions with current treatments. The results of the NOMA economic analysis estimated that the cost of a quality-adjusted life year for Praluent was between NOK600,000 and NOK1,200,000 (USD73,500 and USD147,100), depending on the patient subset; this is substantially higher than Norway's willingness to pay (WTP) threshold. A full economic evaluation is available to read in Norwegian here.

The NOMA decision was based on the results of randomised, double-blind, placebo-controlled and multi-centre Phase III (ODYSSEY) trials for Praluent. The average percentage decline in LDL-C across patient populations at week 24 was 50% at 75 mg and 60% at 150 mg dosage levels. NOMA determined that the effect on cardiovascular morbidity and mortality was not yet known; however, uncertainties in the analysis meant that the agency considered the incremental cost per quality-adjusted life year as substantially higher than what the level it considered cost-effective. However, NOMA noted that, if offered by the manufacturer, a reduction in Praluent's price would improve the cost-effectiveness measurements and the budgetary implications of reimbursing the drug.

NOMA's economic model forecast that the budgetary impact of reimbursing Praluent was likely to amount NOK670 million over a full five-year reimbursement period. Nonetheless, the pricing and reimbursement (P&R) regulator acknowledged uncertainties in its economic model: in particular, it highlighted discrepancies in the estimated number of patients with HeFH in Norway. Officially, this is estimated at 1,300; however, recent surveys of the Norwegian population suggest the incidence rate is higher.

Merck & Co's Keytruda granted reimbursement approval in the treatment of NSCLC

Elsewhere, NOMA announced on 26 September that the Merck & Co's immunotherapy drug Keytruda (pembrolizumab) had been approved for full reimbursement in the treatment of locally advanced or metastatic NSCLC as a second-line treatment option; figures produced by the Norwegian agency indicate that about 700 patients per year are likely to be considered appropriate for such treatment. The decision is likely to have significant budgetary consequences; the first year of reimbursement is forecast to exceed NOK215 million, potentially increasing to NOK315 million per annum by year five. In an interview published by TV2 News (available here), the head of the country's Decision Forum Lars Vorland noted that given the funding impact, it may be necessary to consider prioritising large sub-group patient populations in future.

A full economic assessment is available in Norwegian (here). The NOMA model estimates that the additional cost per quality-adjusted life year for Keytruda, compared with Alimta (pemetrexed; Eli Lilly, US) plus a chemotherapeutic regimen based on docetaxel, is NOK1,106,533. The budgetary impact of reimbursing Keytruda in NSCLC is therefore forecast to exceed NOK500 million per annum: this is considered to be within the upper limits of the range that NOMA considers cost-effective.

Four other treatments rejected for reimbursement approval

NOMA has additionally announced a further four reimbursement rejections, against psoriatic arthritis drug Cosentyx (secukinumab; Novartis, Switzerland), Humira (adalimumab; AbbVie, US) for hidradenitis suppurativa, multiple myeloma (MM) drug Kyprolis (carfilzomib; Amgen, US), and Avastin (bevacizumab; Roche, Switzerland) for the treatment of advanced cervical cancer and the recurrence of cervical cancer in patients. In all four cases, the costs was assessed to be too high against the medical benefits.

Outlook and implications

There is evidence that pharmaceutical companies operating in Norway are reluctant to accept a single, flat-rate rebate agreement, and the guidelines may mean that Norwegian regulators become increasingly willing to reject high-cost medicines in future. There is additionally a risk that negotiations with a number of pharmaceutical manufacturers may stall over the principle of indication-specific pricing. The idea of indication-specific pricing in Norway has also been championed by some patient groups; it is, however, broadly opposed by regulators and pricing negotiators as enormously challenging to implement in practice.

Nevertheless, it is conceivable that the Norwegian health authorities may be forced to again reverse direction. The issue is likely to feature prominently in late 2016, when the Norwegian parliament is scheduled to consider funding of certain high-cost oncology drugs; parliament may further examine indication-specific pricing in the context of efficient use of scarce budgetary resources and covering the cost of new immunotherapy drugs that are on the horizon. Norwegian discussion over future pricing models for cancer drugs are therefore likely to remain a pressing political and regulatory issue for the foreseeable future.