THE HAGUE, NETHERLANDS – Ernst Kuipers, Minister of Health, Welfare and Sport. (Photo by Patrick van … [+]
Last month, the Dutch Ministry of Health, Welfare and Sport (VWS) announced that it will not include the cancer drug Trodelvy (sacituzumab govitecan-hziy) in the country’s standard package of pharmacy and medical benefits.
In 2021, the European Medicines Agency approved Trodelvy for triple-negative breast cancer. Subsequently, beginning in December 2021, the Dutch VWS placed Trodelvy in a so-called lock, which meant it was temporarily excluded from reimbursement because its total costs to the healthcare system for all current and future indications were projected to exceed €40 million annually. Subsequently, the Dutch National Healthcare Institute (Zorginstituut Nederland) was tasked with conducting an evaluation of Trodelvy’s cost-effectiveness profile.
The Dutch Healthcare Institute is an advisory entity responsible for, among other things, providing scientifically based recommendations to the Minister of VWS regarding what can be reimbursed as part of the standard health insurance package. To accomplish this, the Institute carries out technology assessments, analogous to what the National Institute for Clinical Health and Excellence (NICE) does in England and Wales.
For Trodelvy, the Institute calculated an incremental cost-effectiveness ratio of between €196.929 and €241.231 per Quality-Adjusted-Life-Year (QALY). The range of numbers reflects uncertainty in terms of outcomes. Researchers often account for such uncertainty by doing what are called sensitivity analyses.
The Institute maintains a threshold (what it refers to as a “reference value”) of €80,000 per QALY for drugs such as Trodelvy. Specifically, the maximum threshold of €80,000 per QALY is used for treatments targeted at diseases that cause a very high “proportional loss of remaining health.” Here, proportional shortfall expresses the average health loss as a result of a disease or condition over the patient’s remaining lifetime in QALYs as a proportion of the total potential health that a patient could have had without the disease or condition.
For less severe diseases, the threshold is lower. In each instance, thresholds intend to reflect a societal willingness to pay figure rather than what an individual might be willing to spend.
Given the €80,000 per QALY threshold, a price decrease of at least 65% would be needed to make the drug cost-effective, while a 75% discount reflects the mid-range cost-per-QALY estimate.
Upon completion of the study, in July 2022, the Institute advised the Minister of VWS to only include Trodelvy in the standard health insurance package if the manufacturer’s asking price would fall by 75%.
According to the recommendation given by the Institute, the price that the drug maker is asking for the product is not in proportion to the health benefits it produces.
The drug’s manufacturer, Gilead Sciences, does not agree with the 75% price reduction that the Ministry considers necessary to justify reimbursement.
Notably, a few days ago Gilead reported that Trodelvy’s worldwide sales had jumped 52%, from $146 million in Q1 of 2022 to $222 million in the first quarter of this year. The bulk of the revenue is derived from U.S. sales.
Had Trodelvy gotten the go-ahead and been included in the standard package of benefits in the Netherlands, it was expected that 139 patients would be treated with Trodelvy on an annual basis. The drug costs €68,707 per patient.
Notably, the Ministry of VWS employed an opportunity cost argument to justify its decision. The Ministry explained that without the discount, “Trodelvy’s reimbursement implicitly leads to crowding out of care that is more cost-effective.”
The Dutch Minister Ernst Kuipers said: “Of course I would have liked to see the supplier agree to a socially acceptable price, so that the product could have been included in the basic package. Unfortunately that did not happen. The dilemma is that this medicine does produce health gains [patients live an average of 5.4 months longer after treatment with Trodelvy], but this health gain is not in proportion to the price that is asked for it. … Inefficient spending on a drug means less money is available for other important areas of healthcare. That is not the direction I want to go.”
And in perhaps an ominous sign, Kuipers warned that other high-cost drugs could be refused reimbursement in the Netherlands in the future.
The Ministry’s position – and that of the Dutch Healthcare Institute – isn’t immune to criticism. Access to oncology medicines can be a problem in the Netherlands. As an illustration, of the ten cancer drugs approved by the U.S.’s Food and Drug Administration in 2019, only two were part of standard clinical practice in the Netherlands in 2021.
Nevertheless, there is a general consensus in the Netherlands that in order to preserve universal, affordable access to cost-effective healthcare, hard choices must be made. The decision to not pay for Trodelvy at the price asked for is one of these hard choices.