AMNOG may cause havoc in German diabetes market.
By Sebastian Heinzmann, Analyst
9 July 2013
I am an Analyst for cardiovascular and metabolic diseases at Datamonitor Healthcare, focusing primarily on the diabetes ...
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Bristol-Myers Squibb/AstraZeneca, Novartis, and Merck & Co could soon have to drop the prices of their dipeptidyl peptidase-IV (DPP-IV) inhibitors Onglyza (saxagliptin), Galvus (vildagliptin), and Januvia (sitagliptin) in Germany if health technology appraisal bodies there remain less than impressed. The products are undergoing the first retrospective review under Germany’s tough Pharmaceutical Market Reorganization Act (AMNOG; Arzneimittelmarktneuordungsgesetz) pricing and reimbursement system, and the Institute for Quality and Efficiency in Healthcare (IQWiG; Institut für Qualität und Wirtschaftlichkeit im Gesundheitswesen) released its preliminary findings on 1 July 2013.
Pricing in Germany matters not only because it is one of Europe’s biggest markets, but also because a number of other European countries reference prices there. Therefore, price cuts in Germany could eventually lead to reductions elsewhere and impact significantly on company revenues.
The AMNOG system scores new drugs according to the additional benefits they provide compared to those offered by the current standard of care. This scoring then informs the final price of the drug, which replaces the initial freely set launch price that is valid for 12 months. The early evaluation of the developer-submitted dossier and preliminary scoring is done by IQWiG, followed by a final and binding decision by the Federal Joint Committee (G-BA; Gemeinsamer Bundesausschuss). Older, pre-AMNOG drugs may be summoned for review if they compete with a new product that has undergone the new process and if they are important for German patients. Usually, under the AMNOG system, a drug that offers no additional benefit is awarded a price based on that of the comparators, which are often generics.
Retrospective pricing analyses are as justifiable as forward-looking analyses that take into account a drug’s cost/benefit ratio over existing therapies. In a cost-constrained economy it is essential to reduce healthcare spending, and one way to achieve this is to reimburse drugs according to a value for money principle. Somewhat differently to the UK’s National Institute for Health and Care Excellence (NICE), the G-BA not only influences a drug’s position in the treatment algorithm, but also makes decisions that are intricately linked to pricing and reimbursement. IQWiG and the G-BA can be stricter than NICE and their rules regarding comparator assessment leave very little leeway for pharmaceutical companies. Drug developers will now have to design their trials to accommodate the stringent rules and criteria that have been laid out by IQWiG and the G-BA.
Older DPP-IV inhibitors may encounter the same problems as Tradjenta
Januvia, Galvus, and Onglyza were first launched in 2007, 2008, and 2009 respectively, in the era of free pricing. They were called up for an AMNOG assessment because Boehringer Ingelheim’s newer fourth-in-class DPP-IV inhibitor Tradjenta (linagliptin) had to go through the process. In the cases of Januvia and Galvus, their combinations with metformin (Janumet and Eucreas) will also have to undergo the process; the combination of Onglyza and metformin (Kombiglyze) has been evaluated already. Novartis tried to block the retrospective review of its drug Galvus through the German courts.
Boehringer Ingelheim’s drug Tradjenta did not fare well as it compared poorly against generic sulfonylureas, IQWiG’s comparator of choice for the DPP-IV class. Fearing an unsustainably low price at the end of the process, Boehringer Ingelheim chose not to launch Tradjenta in Germany. This did not bode well for the other gliptins called up for review, which were also to be compared against sulfonylureas.
In line with the Tradjenta decision, IQWiG did not see any additional benefit for Novartis’s Galvus and Bristol-Myers Squibb/AstraZeneca’s Onglyza used either as a monotherapy or in combination with metformin. The institute also did not see any additional benefit for Januvia monotherapy, but saw a minor additional benefit for Januvia as an add-on to metformin. Furthermore, IQWiG was dissatisfied with the developers’ studies with respect to comparator choice and in some cases comparator dosing. IQWiG heavily criticized the “incomprehensible” lack of long-term study data given how long the products had been on the market.
The G-BA will make the final decision on the drugs’ additional benefits in September 2013, which could severely impact pricing. While IQWiG did not see an additional benefit for the saxagliptin/metformin fixed-dose combination (FDC), in its final decision the G-BA awarded Kombiglyze a minor additional benefit over a sulfonylurea/metformin combination. This indicates that the G-BA will score parent drug Onglyza as showing some additional benefit in combination therapy with metformin.
Datamonitor Healthcare believes that Januvia and Onglyza will be able to defend their prices. Januvia will likely be able to capitalize on the fact that IQWiG noted a minor additional benefit, while Onglyza will likely escape unscathed too, since the saxagliptin/metformin FDC has already been asserted as having a minor additional benefit by the G-BA. It is less clear, however, how Galvus and its FDC Eucreas will fare. Since the institute and the Federal Joint Committee appear disgruntled over lacking long-term data, Galvus and Eucreas could be used to set an example. The G-BA could stick with IQWiG’s assessment, and Novartis’s drugs could receive an unsustainable price similar to those of generic sulfonylureas.
Compliance with reimbursement body guidelines is paramount
While Datamonitor Healthcare is of the opinion that DPP-IV inhibitors offer additional benefits over sulfonylureas, their developers failed to convince the German evaluation and reimbursement bodies of this. This was chiefly due to non-compliance with the reimbursement bodies’ comparator and assessment guidelines. IQWiG stipulates that sulfonylureas be used as comparators for novel oral antidiabetics, and Novartis, Bristol-Myers Squibb/AstraZeneca, and Merck & Co all complied with this requirement. However, several studies did not follow recommended dose titration guidelines for comparator therapies, did not identify and enroll the appropriate target population, or violated other criteria, which ultimately resulted in the studies being excluded for evaluation purposes.
The inability to show an additional benefit over sulfonylureas can be attributed to suboptimal study design. Datamonitor Healthcare evaluated the dossiers produced by IQWiG and concurs that several developer studies are not suitable for inclusion in the benefit assessments. However, the German assessment bodies do not place enough emphasis on lower hypoglycemia rates with DPP-IV inhibitors, their weight-neutrality, or quality of life issues in general. In contrast to sulfonylureas, DPP-IV inhibitors are a suitable option in the later stages of type 2 diabetes – when beta-cell function is low – but IQWiG and the G-BA seem to be ignoring evidence from other studies and scientific literature about the drug class as a whole.
Drug developers must take into account the various national treatment guidelines and co-operate with reimbursement bodies. Without adopting the standards and requirements for trial design and comparator choices, many drug companies will struggle to get their drugs reimbursed.
The G-BA is unlikely to deny all of the DPP-IV inhibitors a positive score. Not asserting that any of the drugs has an additional benefit over sulfonylureas would result in reference pricing with respect to sulfonylureas, which in turn could lead to the withdrawal of all marketed DPP-IV inhibitors and leave German patients and physicians stranded without these drugs as a treatment option. Considering that around 15% of type 2 diabetics in Germany receive DPP-IV inhibitors, this move would be too risky.
Future antidiabetic drugs may encounter problems
Unless pharmaceutical companies work to improve clinical trial design, novel therapies may not reach the German market. The G-BA has shown that it is not very flexible when it comes to its standards for clinical study design and comparator choices, including comparator titration and dosing. The novel sodium-glucose cotransporter-2 (SGLT-2) inhibitor Forxiga (dapagliflozin; Bristol-Myers Squibb/AstraZeneca) is another example. The study design and comparator choices have led to an unfavorable report by IQWiG, and the G-BA confirmed that – from the data that was submitted by the developers – it saw no additional benefit for Forxiga compared to sulfonylureas. Forxiga is therefore unlikely to launch in Germany in the near future. Assessments of new glucagon-like peptide-1 (GLP-1) agonists may trigger a retrospective analysis of currently marketed members of this class, and it is possible that older therapies will be taken off the German market. Unless trials are designed and conducted with IQWiG’s requirements in mind, other therapeutics will receive verdicts similar to those given to Tradjenta and Forxiga.