Valuing cure: bridging cost-effectiveness and coverage decisions for hepatitis C therapy

The development of direct-acting antiviral agents (DAAs) has revolutionized the treatment of hepatitis C infection. High rates of sustained virologic response (SVR) achieved by DAAs as compared to interferon-based dual therapy will have a profound impact on morbidity and mortality among those individuals able to access and complete treatment.(1, 2) Regimens free of interferon and its punishing adverse effects are now available for genotype 2 and 3 infections, and the most recent treatment guidelines released by the American Association for the Study of Liver Diseases and the Infectious Diseases Society for American have endorsed the off-label combination of sofosbuvir (SOF) plus simeprevir (SMV) as first line therapy for genotype 1 infections in patients who are interferon-ineligible.

Enthusiasm for the new wave of hepatitis C therapeutics has been hindered to no small extent by the accompanying price tag of DAAs. Based on wholesale acquisition costs for sofosbuvir and simeprevir, overall costs for a treatment course has reached $100,000–$250,000 per person.(3) This pricing has provoked outrage from hepatitis C advocates and the community in general.(4, 5) The controversy has given rise to larger questions; How much should hepatitis medications cost? What is a reasonable price to pay to avoid the use of interferon? If costs are non-negotiable, how should expensive but highly efficacious drugs be evaluated by payers?

In this issue of Hepatology, Hagan et al. begin to address these questions through a cost-effectiveness analysis of currently available therapies for HCV genotype 1 infection. The authors compare 12 weeks of sofosbuvir plus simeprevir (SOF/SMV) to 24 weeks of sofosbuvir plus ribavirin (SOF/RBV) in genotype 1, interferon-ineligible patients.(6) Their analysis excludes patients who have failed prior therapy with protease inhibitors, as well as those with decompensated cirrhosis. The baseline assumptions for SOF/SMV included a higher SVR rate, as well as a lower cost as compared to SOF/RBV. With these assumptions, it is not surprising that the authors found that treatment with SOF/SMV “dominated” treatment with SOF/RBV, i.e. resulted in greater health benefit at lower cost. The authors compared the cost per SVR attained for each strategy, and found that SOF/SMV resulted in a “cost saving” of $91.59 per SVR compared to SOF/RBV. The model included the possibility of re-treatment with the SOF plus ledipasvir among those who failed SOF/RBV, a combination under priority review at the FDA. When setting retreatment cost to zero and thus removing any financial penalty for treatment failure in the SOF/RBV strategy, SOF/SMV remained dominant.

Key to understanding a cost-effectiveness analysis is the understanding that this method simultaneously considers concerns about treatment efficacy and cost by asking, “what is the value for money invested in a given health intervention?” Interventions that are deemed cost-effective are not necessarily cost-saving, nor can they be expected to reduce medical expenditures in and of themselves.(7) By explicitly acknowledging resource constraints and data uncertainty, cost-effectiveness seeks to provide guidance to decision makers regarding rational allocation of the healthcare dollar.

One critical element to question about any cost-effectiveness analysis is whether the study considers all relevant treatment options for a population. The study by Hagan et al. included patients who cannot tolerate interferon, focusing entirely on interferon-free regimens. Certainly, most HCV providers in 2014 are eager to leave interferon behind. The study did not, therefore, include the potential to treat HCV genotype 1 with interferon, ribavirin, and sofosbuvir for 12 weeks, a regimen discussed in current treatment guidelines that has similar efficacy to SOF/SMV and lower cost. If the 12-week PEG/RBV/SOF regimen were included in the analysis, both SOF/SMV and SOF/RBV would likely appear far less economically attractive. The challenging question then becomes “what does it mean to be interferon ineligible?”

Another key to interpreting cost-effectiveness analyses lies in understanding the limits of the primary data that are the sources for model inputs. In this study, parameter uncertainty was examined by individually varying key model inputs to assess impact on results. For example, the SVR rate conferred by each regimen was varied based on clinical trial findings. The authors acknowledge that these estimates are limited by the small sample sizes, with data even further limited for patients with advanced fibrosis (use of SVR4 from the COSMOS trial for SOF/SMV). While this subgroup of patients may benefit most from therapy given their risk of decompensated liver disease, they have also been shown in the case of telaprevir and boceprevir to suffer much higher rates from adverse effects and treatment failure once these medications were used more broadly in real world settings.(8, 9)

With these limitations in mind, how should these findings be interpreted? We may say that for truly interferon-ineligible, genotype 1 patients, SOF/SMV, a more efficacious and less expensive regimen compared to SOF/RBV, provides greater value for money based on early clinical trial data. While in hindsight, this seems like an obvious conclusion, it remains true that some insurers do not cover the SOF/SMV combination, which is almost certainly economically unwise. Hopefully, these data will move payers to see that the cost of SOF/SMV is justified by the long-term benefits.

Unfortunately, cost-effectiveness analysis may not motivate insurance coverage decisions as much as simple upfront costs. In California, a public meeting of the health insurers presented a modeling analysis finding that while SOF/SMV had lower per patient initial treatment costs than SOF/RBV in interferon-ineligible patients, even at 20 year projections, only 40% of these upfront costs would be offset by savings due to averted liver complications.(10) To date, state Medicaid programs have varied in action, from providing coverage for both medications, to limiting coverage to patients with advanced disease, to outright rejecting drug applications.(11)

From the patient’s perspective, the escalating cost of hepatitis C therapeutics will undoubtedly worsen treatment access and delay care. In addition to the variation described in state Medicaid, advocates have warned that private insurers, including many Qualified Health Plans in the federally-facilitated marketplace and state-based health exchanges are charging high co-pays for hepatitis C drugs, resulting in great financial risk to enrollees.(12)

From a societal standpoint, we may determine that new direct-acting antiviral therapies are indeed cost-effective, at least for a subset of patients. However, bridging our valuations and the financial realities that constrain and drive treatment coverage remains a great challenge, and it is the patients who pay the price by our inability to do so.