Off-label prescribing – a new mechanism for payers to drive down cost | Deloitte UK has been saved
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Off-label prescribing is the prescription of a drug for an indication or for an age group, dose or form of administration for which it is not approved. Recently, it has become a thorny topic for the life sciences industry, regulators and healthcare payers, with high profile cases arising in France and Italy.
Payers, as outlined in our 2013 report on Impact of Pricing austerity on European pharmaceutical policy and pricing, have identified a number of mechanisms to provide healthcare cost savings. Drug budgets remain a relatively easy target for rationalising healthcare costs and European payers see off-label prescribing as a new mechanism for reducing cost.
Contrary to popular belief off-label prescribing is not illegal unless it violates certain ethical guidelines or safety regulations. Worldwide, physicians are able to prescribe drugs off-label in the majority of countries, however:
Historically, off-label prescribing has provided important treatments for patients who have typically tried all available drug therapies or, for which there is no approved drug, for example, a child who has a life threatening cancer for which all available drugs therapies have been tried or there are no approved medicines. Given the choice of no treatment at all or trying an unapproved drug, which might just provide some relief, what would you do?
Off-label use is common. In the United States, a 2006 study found that up to one fifth of all drugs are used off-label at some point, typically prescribed more frequently by specialists than general practitioners (GPs) and, a 2009 study of US paediatric consultations found that 62 per cent of visits resulted in an off-label prescription[i],[ii]. A UK study in 2007 estimated that 26 per cent of children receive an off-label prescription from their GP each year[iii].
The current issue in France and Italy involves the off-label use of Roche’s anti-cancer drug Avastin for treating wet age-related macular degeneration (wet-AMD). Novartis’s Lucentis is the only drug approved for the treatment of wet-AMD, but costs significantly more than Avastin (in Italy, Lucentis costs €900 per injection, Avastin €81). On the face of it, promoting the use of a drug off-label when there is such a difference in price may seem like an appropriate route to take, as it saves money that could be channelled into meeting other healthcare costs. However, there are a number of challenges that the pharmaceutical industry is raising:
But Italy and France are not the only European countries that see off-label prescribing as a cost-saving initiative. In 2011, the UK government requested a comparator study of Avastin and Lucentis to assess relative cost-effectiveness and safety for treatment of wet-AMD[v]. Based on the trial results, a number of primary care trusts implemented policies to use Avastin off-label. In July 2012, Novartis lowered the price of Lucentis, resulting in withdrawal of these off-label prescribing policies.
Legislation and prescribing guidelines have been introduced in a number of European markets to promote the use of cheaper, off-label alternatives to approved drugs:
Fund holders have woken up to the potential of promoting off-label prescribing to drive down drug budgets. The pharmaceutical industry is fighting its corner and focussing its arguments on patient safety. However, off-label prescribing practices have developed from being a final, last-ditch attempt to save a patient with no treatment options, to a mechanism which provides payers with cost saving opportunities. While it is inappropriate for payers to focus on cost savings at the expense of patient safety, equally industry needs to understand that where two, equally effective drugs are available, payers will undertake their own benefit-risk analyses to realise potential cost savings. This illustrates the importance of all stakeholders working together at the earliest opportunity to find solutions which are mutually acceptable and maximise patient benefits.