United States: 3 Pressing Challenges For Personalized Medicine

Personalized medicine can be described as the science of targeted therapies. Advances in diagnostic and molecular medicine have made it possible to more precisely identify alternative treatment options for patients based on their unique genetic or clinical profiles. According to an article published by the FDA in the spring of 2015 (FDA Continues to Lead in Precision Medicine), targeted, personalized therapies have been a priority for the agency since the 1990s when Herceptin (trastuzumab) was approved for treating breast cancer patients expressing high levels of the HER-2 biomarker. The FDA article also notes that 30-targeted therapies were approved since 2012 and in 2014 alone, eight of the 41 novel drugs approved by the Agency were targeted, including:

1. Lynparza (olaparib) for the treatment of advanced ovarian cancer.
2. Blincyto (blinatumomab) for the treatment of B-cell precursor acute lymphoblastic leukemia (ALL).
3. Harvoni (ledipasvir and sofosbuvir) to treat patients with chronic hepatitis C infection.
4. Viekira Pak (ombitasvir, paritaprevir, dasabuvir and ritonavir) for the treatment of chronic hepatitis C infection.
5. Cardelga (eliglustat) for the long-term treatment of Gaucher disease type 1.
6. Beleodaq (belinostat) for the treatment of peripheral T-cell lymphoma.
7. Zykadia (ceritinib) to treat patients with non-small cell lung cancer (NSCLC).
8. Vimizim (elosulfase alpha) for the treatment of Mucopolysaccharidosis Type IV (Morquio Syndrome).

The increase in Agency-approved therapies is evidence of the technical and clinical progress that has been made in personalized medicine. However, technical and clinical proficiency without supportive policies by insurers and payors can impede patient access to these improved therapies.

The lack of adequate support by payors and in particular Medicaid is addressed in the Personalized Medicine Coalition ("PMC") in its report – "The Future of Coverage and Payment for Personalized Medicine Diagnostics" ("Report"). In addition to the lack of adequate incentives to support targeted therapies, the Report notes that the current payment model and America's aging population is a

"stimulus for a longer-term and more progressive approach to decision in medical care. Personalized medicine can control costs and improve outcomes, and the increased attention on the future of Medicare will demand creative approaches to accomplishing these goals."

Three major challenges were identified by the PMC:
1. Imminent federal pricing of highly innovative molecular tests;
2. Inconsistent standards and paradigms for evaluating diagnostic, prognostic, and predictive genomic tests; and
3. Lack of incentives for genomic medicine.

Imminent Federal Pricing

As noted by the Report, new personalized therapies are efficient therapies that can reduce the cost of health care. If a patient is treated with the best medicine from the start, the use of multiple failed or ineffective therapies, supported by repeated medical support, is avoided. In addition, personalized medicine is not limited to branded drugs but can also include cost-saving generic medicine. Advanced diagnostics that use liquid tissue samples (such as blood or needle aspiration) for initial diagnosis or monitoring can avoid the use of surgical biopsies that can also reduce costs.

However, the PMC's Report notes that there have been recent changes in the "coding and pricing" paradigms for genomic tests between 2012 and 2014. As explained by the Report, coding and administrative pricing for laboratory diagnostic tests are handled in a "unique way by the Centers for Medicare & Medicaid Services (CMS)' Medicare program" and "[r]ecent changes to molecular diagnostic reimbursements in ... 2013 were often rocky, and extended as far as a nearly complete cessation of federal payments for genomic tests in the first quarter of 2013." Report at page 6.

The issue for the industry, as noted by the Report, is that reimbursement for diagnostic tests (that have been unilaterally set in the past by policymakers), must not only "ensure access to high quality tests but also continue to allow for the development of a pipeline of innovative tests that require substantial risk-based research." Pricing payments too close to the marginal cost of the provider will not allow for innovators to provide the product and recoup the cost to develop it.

Inconsistent Standards for Genomic Tests

Current diagnostic tests are to be evaluated for their "clinical utility" a standard that is neither clear nor predictable. As noted by the Report, "[m]ore objective and reliable standards for these evaluation processes need to become broadly accepted. Since many argue that reimbursement should be tied to value, value (utility for the patient) needs to be acceptably defined." Report at page 7.

Lack of Incentives for Genomic Medicine

Most approved personalized therapies are related to the diagnosis and treatment of cancer. However, personalized medicine's impact need not be so limited but as noted by the Report, lack of funding to support the science and implementation (for example, lack of funding to educate genetic counselors and physicians) limits adoption and innovation. The Report indicates that the lack of protection, either by patents or other means, has created uncertainty as to how to attract sufficient "investment capital and research and development funds to permit their commercialization." Report at page 7.

Marginal Cost is Not Value

In sum, the PMC in this Report advocates for a "reimbursement system that encourages the improvement of patient care through medical innovation." Report at page 25. The current system determines reimbursement based on the marginal cost of the benchtop chemistry to offer the test. However, it fails to consider the significant research and development costs (which can include regulatory approval or oversight) that were expended by the innovator and the improvement in the quality of, and extension of, life that is the value of personalized medicine. The Report states that the current system fails the public in failing to consider the factors described in the Report that first to market innovators must bear.

Paying and Supporting Diagnostic Innovation

Lack of access to the BRCA1/2 diagnostic test was one of the policy reasons advocated by the patient-plaintiffs in the Myriad Genetics patent suit. Some insurers would not pay for the test and patients who wanted it could not afford the out-of-pocket cost. After the US Supreme Court invalidated Myriad Genetics' patents covering the BRCA1/2 test, other laboratories entered the market with their own tests, and the cost dropped. However, lowering the cost did not translate into universal coverage for the test and access is therefore still limited.

Whether one agrees with Myriad's business model around its BRCA1/2 genetic test, it is difficult to dispute that Myriad's patent position allowed it to develop the science and technology that other labs now rely on in offering their tests. Without the ability to protect and develop the technology through patent protection, innovators need to rely on other means to recoup the cost of research and development. Current payment models, as noted by the PMC Report, however, currently fail as viable alternatives for recouping such costs.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.