Canadians owe a large part of their longer lives to a better standard of living, healthier lifestyles and, of course, new and better medications that target specific illnesses. However, newer medications often come at an increased cost, and once they are made available they become a concern for plan members and ultimately plan sponsors. In fact, high-cost drugs(i.e., single drugs costing more than $5,000 per patient annually)continued to increase in use and dominated new drug approvals in the Canadian marketplace in 2006. Approximately one half of the new drug molecules launched in Canada during the previous year were high-cost drugs(see Table 1, below). Of note, several of these new high-cost drugs are specialized medications used to treat rare conditions with small patient markets. For example, Exjade(deferasirox)was approved for the management of chronic iron overload in patients with transfusion-dependent anemias (deficiency in red blood cells). This oral agent was developed to improve patient compliance over previous injectable products and will cost $30,000 to $40,000 per patient per year. It is estimated that only 10,000 people in Canada have blood disorders that would warrant this type of treatment, and data suggests that only 10% of patients are currently receiving chronic treatment. An increasing trend among specialized medications is the development of biologic agents. In fact, one of the highest costing agents entering the market in 2006 was the biologic drug Tysabri (natalizumab), indicated for relapsing-remitting multiple sclerosis. Tysabri is generally recommended as a second-line agent in patients who are unable to tolerate or who have had an inadequate response to other disease-modifying therapies. Tysabri costs approximately $35,000 per patient per year. Similarly, Orencia(abatacept), a new biologic approved for the treatment of rheumatoid arthritis, will cost upward of $25,000 per patient per year. Also included in Table 1 is the highly publicized vaccine Gardasil, which is used to prevent diseases caused by human papilloma virus(HPV). Certain strains of the virus are linked to the development of cervical cancer. This product is noteworthy because of the number of people who can be treated with this agent—it is indicated for all girls and women aged nine to 26. Gardasil is also being studied for use in males. The 2007 federal budget recently announced that $300 million will be allocated to provincial bodies over a threeyear period to help fund the costs of the vaccine. As provinces begin to introduce Gardasil coverage, this should remove some of the financial burden from private insurers/plan sponsors. GENERIC INFLUENCE While new high-cost drugs coming to market and new indications for existing drugs can increase costs to plan sponsors, the introduction of generics to the market helps to decrease overall drug plan costs. Of importance, several highly utilized brand drugs now have generic equivalents that entered the market during the course of 2006. The experience with generic azithromycin is a suitable example to illustrate the importance of new generics coming to the market and subsequent erosion of the brand drug. Zithromax, an antibiotic used for various infections including pneumonia and infections of the ear and urinary tract, was genericized in November 2005. ESI Canada data from 2006 indicate that the generic market share now exceeds 50% and has resulted in more than a 20% decrease in the average cost per prescription. It is anticipated that similar reductions in costs will be observed for other highly utilized products that recently came off patent, such as Altace and Effexor XR, which could help decrease overall costs for plan sponsors. The top 10 drugs(by total expenditure)in ESI Canada’s book of business for 2006 are found in Table 2(see above). The majority of the top 10 drugs are for common conditions such as high cholesterol, cardiovascular diseases, and stomach ulcers and reflux disease. However, it is important to note that the biologics Enbrel and Remicade are among the top 10 drugs, yet both are ranked extremely low in terms of number of overall prescriptions. This exemplifies the fact that highcost drugs for small patient markets can have a significant impact on plans. And with new indications, costs are likely to increase as more patients are now eligible to be treated with these agents. Strategies for plan sponsors to curb some of these increasing costs include use of a managed, tiered formulary that promotes evidence-based first-line agents and reimburses them at a higher co-insurance versus non-preferred second-line agents, reimbursed at a lower co-insurance; Prior Authorization—whereby reimbursement is restricted to Health Canada-approved indications only, location of administration(e.g., hospital vs. private clinic or community setting)or ensuring the patient has failed a less costly alternative before receiving a more costly agent; ensuring that coordination of benefits is set up appropriately so claims can be transmitted through a spouse’s/dependent’s plan as the correct primary payer; and use of high amount pooling or stop loss for small employer groups. Finally, it is important to acknowledge that although these drugs are more costly than conventional agents, they can provide important advantages to patients. Monitoring short-term and long-term disability, for example, in patients taking these agents may be beneficial to help support their use as other downstream costs may be reduced or eliminated. High-Cost Drugs Introduced to the Canadian Market in 2006(Table 1) | Brand Name(generic name) | Manufacturer | Indication(s) | Avg. Annual Ingredient Cost/Patient* | | Tysabri(natalizumab) | Biogen Idec | Multiple Sclerosis | $36,000 | | Exjade(deferasirox) | Novartis | Iron chelator for chronic iron overload | $30,000 | | Orencia(abatacept) | Bristol-Myers Squibb | Rheumatoid Arthritis | $25,000 | | Somatuline Autogel(lanreotide) | Ipsen UK | Acromegaly(overproduction of growth hormone) | $20,000 | | Revatio(sildenafil) | Pfizer | Pulmonary Arterial Hypertension(increased arterial pressure in the lungs) | $12,000 | | Prezista(darunavir) | Janssen-Ortho | HIV/AIDS | $10,750 | | Truvada(emtricitabine/tenofovir) | Gilead Sciences | HIV/AIDS | $9,600 | | Baraclude(entecavir) | Bristol-Myers Squibb | Chronic Hepatitis B | $8,500 | | Sebivo(telbivudine) | Novartis | Chronic Hepatitis B | $6,500 | | Nexavar(sorafenib) | Bayer | Kidney Cancer | $7,350/6 wks | | Sutent(sunitinib) | Pfizer | Gastrointestinal Stromal Tumours(GIST)& Kidney Cancer | $7,330/6 wks | | Gardasil(HPV vaccine) | Merck Frosst | Prevention of diseases caused by Human Papilloma Virus(HPV) | $435/3 doses |
*Unless otherwise noted, pricing is taken from ESI Canada’s database, and calculations are based upon manufacturer-recommended dosing. Top 10 Drugs Nationally for ESI Canada 2006(Table 2) | 2006 Cost Ranking | 2005 Cost Ranking | Drug name(generic name) | 2006 Rx Ranking | 2005 Rx Ranking | Common Use(s) | | 1 | 1 | Lipitor(atorvastatin) | 1 | 1 | High cholesterol | | 2 | 2 | Effexor XR(venlafaxine)+ generics | 4 | 4 | Depression, anxiety/panic disorders | | 3 | 4 | Altace(ramipril)+ generics | 5 | 6 | Cardiovascular diseases | | 4 | 6 | Nexium(esomeprazole) | 26 | 32 | GI reflux and stomach ulcers | | 5 | 5 | Norvasc(amlodipine) | 14 | 19 | Cardiovascular diseases | | 6 | 7 | Pantoloc(pantoprazole) | 25 | 27 | GI reflux and stomach ulcers | | 7 | 3 | Losec(omeprazole)+ generics | 38 | 29 | GI reflux and stomach ulcers | | 8 | 11 | Enbrel(etanercept) | 322 | 339 | Rheumatoid Arthritis, Psoriatic
Arthritis, Plaque Psoriasis | | 9 | 13 | Remicade(infliximab) | 469 | 482 | Rheumatoid Arthritis, Crohn’s,
Ulcerative Colitis, Psoriatic Arthritis | | 10 | 10 | Crestor(rosuvastatin) | 15 | 28 | High cholesterol |
Cory Cowan is a clinical specialist with ESI Canada in Toronto. ccowan@express-scripts.com For a PDF version of this article, click here. |
