Medicare’s coverage with evidence development tool could be linked with expanded forms of accelerated FDA drug approval to help ensure effective postmarket evidence collection, stakeholders suggest in recent comments to the Centers for Medicare and Medicaid Services.

The combination of CED with accelerated approvals could help address payer concerns about products, such as targeted therapies, entering the market with less supporting data than is typical under a regular approval.

In Jan. 20 comments, the Engelberg Center for Health Care Reform at Brookings, led by Mark McClellan, a former CMS administrator and former FDA commissioner, and the Center for Medical Technology Policy (CMTP), led by former CMS Chief Medical Officer Sean Tunis, propose that with a number of improvements, the underused Medicare Part B coverage mechanism could facilitate faster market entry for cutting edge drugs.

Under CED, Medicare provides reimbursement for new medical products or services that may have limited outcomes evidence with the condition that additional data is collected via patient participation in a registry or clinical trial. CMS may use the strategy for products or procedures that are not yet fully proven or in instances where the agency wants to ensure that the treatment or diagnostic is being used in the appropriate patient population. It applies to coverage of drugs administered through physicians’ offices (Part B) but not currently to outpatient products covered under Part D.

The comments respond to CMS’ call for public input on revising its 2006 guidance on CED Also see "CMS Sets The Stage For New Medicare "Coverage With Evidence Development" Guidance" - Pink Sheet, 8 November, 2011.. The tool has been used only once for drugs, in 2005 for four colorectal cancer treatments, but clinical studies conducted on the drugs have not supported any new coverage decisions for them.

CMS Coverage and Analysis Group Head Louis Jacques described the solicitation as a request for “imaginative” ideas about CED; the Engelberg & CMTP responses certainly qualify.

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In general, drug firms are wary that CED could be used to restrict market access for newly-approved drugs or biologics, for example by covering a treatment or certain indications only within the confines of a clinical trial ([A#00120206013]). The biopharmaceutical industry is more comfortable with the status quo: Medicare Part B coverage policy currently permits relatively open access to new drugs once approved, and off-label uses are covered if supported by authoritative medical guidelines and compendia.

CMS’ announcement that it is revisiting its CED policy can be read as a signal that the agency intends to use CED more frequently, which is worrisome to many in the biopharma industry. In recent public statements, the agency has indicated that its interest in revitalizing CED is connected with the current focus on increasing FDA’s use of accelerated drug approvals.

Louis Jacques, director of the coverage and analysis group within CMS, addressed the intersection of CED and progressive approvals during The RPM Report’s FDA/CMS Summit In December. “One of the challenges we have right now, even through a traditional approval process from a regulatory point of view, is that there are often questions that are relative to the Medicare program but have not been addressed sufficiently for us to confidently make a coverage determination,” he said.

“So if a product is going to be approved for marketing with even less information than is currently being produced, I think one would wonder how we might deal with that” and the question arises: “Are those sorts of products or approvals ones that would naturally lend themselves to a CED?” If “CMS and FDA harmonized or had some agreement that in fact we had the same outstanding questions, would coverage with evidence development in fact be the perfect place for that technology?”

Furthermore, Jacques pointed out, “if you have an FDA postmarket requirement, you’re certainly going to enroll and complete that requirement much quicker if Medicare is in fact incenting enrollment. And if Medicare is also paying for your particular technology rather than you having to essentially pay for it yourself in that setting, it also seems like there’s some advantage there. It may not be appropriate for every technology but that’s one of the things that we ask people to comment on with CED – to think more broadly on this.”

Policy Group Comments Reflect Stakeholder Consultations

The Engelberg Center and CMTP have both engaged in stakeholder consultations to explore the benefits and challenges of linking CED to accelerated FDA approvals. Those consultations are reflected in their comments.

The Engelberg Center comments reflect discussions from a multi-stakeholder roundtable in December that was followed by a conference call in mid-January. Participants represented public and private payers, regulatory authorities, including FDA Office of the Commissioner Senior Advisor Vicki Seyfert-Margolis and Deputy Center Director for Clinical Science Bob Temple, and manufacturers, including Takeda Oncology and the Biotechnology Industry Organization. Engelberg cautions the comments do not necessarily represent the views of participants.

Nevertheless, they urge that CMS consult with FDA and drug developers as part of a priority-setting process for CED that is focused on “the most important evidence questions with the best opportunities for closing knowledge gaps.” Specifically, Engelberg suggests that CMS, FDA and product developers – on a voluntary basis – identify drugs going through FDA’s accelerated approval process with the goal that “CED could facilitate fulfilling postmarket regulatory approval requirements. … This would potentially allow faster coverage of the newly approved intervention while accelerating the Phase IV studies.”

Medicare coverage and continued evidence development in these cases “will be highly important because any drug or biologic approved through an expedited approval pathway is likely to represent the only existing intervention or a major step forward for the treatment of a disease,” the group points out.

Engelberg also suggests that consideration of CED as an important support for accelerated approval is timely, given the current discussions in Congress over expanding the types of accelerated approvals FDA can make Also see "Accelerated Approval Expansion Proposals Pending, But One Needs An Overhaul" - Pink Sheet, 6 February, 2012..

Ideas circulating in Congress include adding language to Prescription Drug User Fee Act reauthorization legislation that would broaden the surrogate endpoints FDA can use as the basis of an approval and allow the agency to accept a wider range of evidence to make the program available to more therapeutic areas). FDA’s accelerated approval program covers treatments of serious and life-threatening diseases and drugs that address unmet medical needs.

CMTP similarly encourages CMS to “explore more opportunities to work closely with the FDA to identify promising new technologies for CED and coordinate study design requirements.” The group notes that the recently announced FDA-CMS parallel review pilot project “takes important initial steps in this direction.” The agencies have begun a pilot parallel review project involving a coordinated approach to premarket review that involves medical devices. Also see "FDA-CMS Parallel Reviews: Too Close for Comfort?" - Pink Sheet, 1 February, 2008.

CMTP’s comments reflect, in part, an exploration of the advantages and challenges of combining CED with FDA’s accelerated approval or “adaptive licensing” program in a separate report issued by the group in January. Entitled “Coverage with Evidence Development & Adaptive Licensing; Two Sides of the Same Coin?” the report summarizes discussions from a multi-stakeholder workshop co-sponsored by CMTP and MIT in November 2011. It looks at the possibility of applying CED both in the Medicare program and through private insurance.

During the workshop, participants discussed linking the policies to two case studies involving targeted drug therapies: Roche/Genentech Inc.’s recently-approved treatment for metastatic melanoma Zelboraf (vemurafenib), and a Phase II lipid-lowering drug targeting patients who are resistant to current LDL-lowering therapies.

Drug industry attendees at the workshop were mainly from Pfizer Inc. . They represented the company’s research, product development, regulatory and outcomes research groups, indicating the company’s high level of interest in the topic (see box). Although the CMTP report does not name the cholesterol drug in the case study, Pfizer has an LDL drug in Phase II development known as RN316 (PF 04950615), according to the company’s pipeline information. The other industry representative at the workshop was GlaxoSmithKline PLC Senior VP and Head of EU Access To Medicines Edward Godber.

Also participating were FDA Office of the Commissioner Senior Advisors Murray Lumpkin and Vicki Seyfert-Margolis. Payers represented included CMS, with Chief Medical Officer Patrick Conway, Louis Jacques and Office of Clinical Standards Medical Officer Shari Ling participating, as well as Aetna, Wellpoint and Medco.

Pfizer Team Attending November 2011 CMTP/MIT Workshop On Adaptive Licensing and CED

Indranil Bagchi, VP and head of market access for the Specialty Care business unit
Owen Fields, VP worldwide regulatory strategy, Worldwide R&D
Diane Shoda, director of worldwide regulatory strategy
Stephane Billotte, scientist
Brian Cuffel, senior director, global market access, Primary Care business unit and head of Health Economics and Outcomes Research
Pamela Garzone, clinical team leader
Barry Gumbiner, executive director; clinical lead for endocrine/metabolism, Biotechnology Unit and Oncology Research
Tom Unger, head of strategic planning for the Biotherapeutics and Bioinnovation Center
Hong Liang, associate research fellow

Case Studies: Zelboraf, Early-Stage LDL Reducer

Roche/Genentech's Zelboraf was approved on an accelerated basis in August 2011 for treatment of patients with unresectable or metastatic melanoma with the BRAF V600E mutation, as detected by an FDA-approved test. Based on dramatic clinical effectiveness compared to existing therapies in Phase I and II, Roche was able to modify its Phase III trial and conduct earlier interim analyses. The therapy then received full approval after a review lasting less than four months. Also see "Roche and FDA in Oncology: Fighting in Public, Collaboarting in Private" - Pink Sheet, 1 November, 2011.

Postmarketing commitments include submission of updated overall survival results from the ongoing BRIM3 study that served as a basis for the approval and data on resistance to therapy. The CMTP report points out the “levels of adherence” by sponsors to postmarketing commitments “are difficult to ascertain” and this has been “one of the challenges faced by regulators, where recommended post-market studies are difficult to initiate and complete.” CED requirements could help ensure the studies are carried out, the report suggests.

In the private sector, one potential vehicle for implementing CED would be through the use of prior authorization, in which payers could require participation in a study as a condition of coverage. In Medicare, applying CED to the Zelboraf situation would be trickier. Since it is an oral drug, it is covered by Part D, and Medicare currently has limited ability to apply CED under Part D.

Nevertheless, the report lists a number of reasons why payers might be interested in CED for Zelboraf:

The approval was based on progression-free and overall survival. Payers might be interested in identifying subgroups of better responders, according to the report.
Additional studies might be helpful to examine effectiveness of the drug for other mutations in the BRAF gene.
The approval was for metastatic disease and CED would be helpful for controlling “diffusion” of the treatment to earlier stages.
Preliminary findings that some patients become resistant and show adverse events raise questions about how the drug will work in a larger population.

CMS Takes a Pass on BRAF?

During the FDA/CMS Summit, Jacques indicated that the CMS coverage group isn’t likely to get involved in the BRAF testing issue. It is not that the agency feels there aren’t issues with personalized medicine; in fact, Jacques argues genomic testing is an ideal area to consider applying CED.

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It’s just that Jacques hasn’t seen any significant real-world problems with access to BRAF testing. “I think if there were any coverage challenges being posed to that, one, the contractor medical directors would be heating up my LISTSERV; and two, there’s a significant number of representatives of a certain firm who would be chasing me around this room right now. They haven’t been.”

Still, Jacques said, “It’s an interesting intersection, because national coverage determinations don’t operate in Part D. So, what do you do when you have a Part D product where arguably there’s a Part B service that could be very informative with that?”

“While we have not done a national coverage determination on that particular use of a diagnostic test, what I’ve heard from our contractors is essentially that they do recognize that the label for the product—which we’re talking about, but not actually naming it—the FDA labeling actually talks about the use of an FDA-approved test kit in order to do this particular testing.”

“The theory is that, when there’s a plausible case made that this is a good way to inform care, that people do it,” Jacques said.

“It is a challenge,” he added, “because a Part D claim is not going to go to a Part B Medicare Administrative Contractor, and a Part D pharmacy benefit manager presumably is not going to have access to the Part B claim, and especially the test result, unless people agree to play well in the sandbox.”

“I have my fingers crossed that people will continue to act well.”

Scaled Payment As Evidence Develops

For the cholesterol drug considered in the second case study, preclinical work has shown the therapy significantly lowers LDL levels in animals with a particular genotype, and early phase clinical trials demonstrate it effectively reduced LDL independently and in combination with statins, that HDL cholesterol remained unaffected, and that there were minimal adverse events, the report notes.

An “adaptive licensing” scenario for the drug that emerged from discussion between manufacturers, payers and regulators who attended the workshop envisions a staged approval for different indications, with the design and outcomes for studies supporting each indication defined in advance by all stakeholders.

For example, a first study would test the therapy for a targeted indication in high-risk patients with a high burden of disease, as determined by genetic testing. The study design would include surrogate endpoints, such as lowering LDL cholesterol, which are less acceptable to payers and regulators, but would be acceptable because there is an urgent need for the drug in the specific patient population.

A second study, conducted simultaneously with the first, would evaluate the drug in a larger population, such as patients who do not have the genetic deficiency, but for whom existing therapies are not sufficient to maintain normal LDL. Endpoints would include changes in LDL levels as well as improvement in quality of life, such as a reduction or elimination of the need for apheresis, a procedure used to remove LDL cholesterol from the bloodstream.

A third study would test the drug in a much broader population with concomitant diseases and for whom survival benefit will be measured using morbidity and mortality endpoints. One of the options discussed by payers was that information on endpoints such as mortality could be gathered through an observational study, potentially through administrative claims databases, the report notes.

Reimbursement for the drug would follow a progressive payment scheme that would parallel the adaptive licensing scenario. The approach would provide full payment for the approve indication, with lower reimbursement for broader use of the drug while it is still being studied in other populations. Payments could be adjusted upward once the results of the other clinical studies are available.

“This strategy would provide an incentive to the product manufacturer to develop further evidence on effectiveness of the drug in a broader population,” the report explains. “Another advantage of this approach would be that all decision makers would know earlier if the drug does not work effectively for a particular population.”

Coverage With Evidence Development and Expedited Approvals: Policy Proposals For FDA and CMS

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