Pradaxa pharmacoeconomics

Today Boehringer-Ingelheim’s Pradaxa (dabigatran) achieved preferred Tier 2 formulary status with pharmacy benefit managers Medco Health Solutions and CVS Caremark.  CVS Caremark and Medco added Pradaxa to their commercial preferred drug lists, and Medco added the drug to its Part D drug list.

In February 2011 we asked our Anticoagulants Thought Leaders about the pharmacoeconomics of direct thrombin and FXa inhibitors.  One of our Panelists walked us through Boehringer-Ingelheim’s pharmacoeconomic thesis for Pradaxa.  It goes something like this:

o   The total retail cost per day for Pradaxa is $7.90, making the annual cost $2,884.  With warfarin’s cost per day of 30¢, its annual cost is $109.50.  The annual cost of INR monitoring is $2,134 the first year and $1,652 thereafter (use an average of $1,652 / yr).  The drug acquisition and monitoring cost of warfarin is $1,761, and thus, the annual additional cost for Pradaxa = $1,123.

 

o   Given the 0.5% mortality reduction (which was borderline significant for Pradaxa 150), you would need to treat 200 patients to save 1 life-year.  That 1 life year will cost an additional 200 x $1,123, or $224,600.  The survival of an average 71 year old a-fib patient is about 6.75 years, so if our “$224,600” patient doesn’t die from a stroke, he will get those 6.75 years.  Therefore he really only costs 224,600 / 6.75 = $33,274 per year of life saved.

 

o   CDC estimates that the lifetime cost of all cause stroke is $100,000.  The rate of stroke per year was 1.57% for warfarin and 1.01% for Pradaxa 150 mg.  Therefore there is a 0.56% lower rate of stroke per year on Pradaxa and if 200 patients needed to be treated to prevent one death, there would be 1.12 fewer strokes.  At a cost of $100,000 over the lifetime of a stroke patient, preventing 1.12 strokes means that Pradaxa would save $112,000.

 

o   Pradaxa numerically (but not significantly) lowered the number of major bleeds (3.4% vs. 3.1%).  The cost of a major bleed is $8,000.  Thus in our 200 patients there would be 0.6 fewer major bleeds, saving $4,800.

 

o   Pradaxa increased the risk of MI (0.74% vs 0.53%).  The cost of a significant q wave MI is $7,000.  Thus treating our 200 patients with Pradaxa would increase the cost by $2,800.

 

o   Doing the math, the total additional cost of Pradaxa treatment inclusive of complications in 200 patients is $110,600.  The cost per year of life saved (assuming 6.75 years of survival) is $16,385.

 

o   If society views $50,000 / yr of life saved as cost effective, and if it costs society $110,600 to save that life, then an a-fib patient only has to survive 2.2 years for the therapy to be cost effective.  Since the average 71 year old a-fib patient survives 6.75 years, and this exceeds the 2.2 year threshold, Pradaxa is cost effective.

 

o   A similar analysis based on all cause stroke would go something like this:  Pradaxa reduced all cause stroke from 1.57% to 1.01% (reduction = 0.56% / yr).  Therefore you would need to treat 179 patients with Pradaxa to prevent 1 stroke.  This incurs an incremental cost of 179 x $1,123 or $200,535.  On the other hand the lifetime cost of all cause stroke is $100,000.  The net cost would therefore be $100,535.  Patients with stroke survive about 5.8 years, so Pradaxa costs $17,333 per year of stroke free life saved.

Some other thoughts from our experts:

“They are trying to demonstrate that the cost effectiveness of the compound due to the fact that, as you said, you placed a price on it and one could say well these are really worth going in this direction due to the fact that the alternative, the old alternative, which everybody has been criticizing for so many years just turns out to be cheaper.  The cost effective analysis have been truly outstanding.   Is that getting them on formulary? No, no, I would say cost effective in terms of what we call delta quality, these types of parameters which can justify the use of the drug.  Right, so what I am asking though is so we have these either hospital formularies or outpatient formularies. Yes.  So what I am saying whatever the cost is, when I say delta quality what I mean by that is the drug cost effective, I am not saying for the patient but for healthcare, yes or no?  And the delta quality for the low dose of dabigatran turns to be around 51,000 dollars and for the high dose 45,000 dollars.  So basically these are parameters that at the end of the day allow insurance companies basically to say, well this is a very cost effective drug.  This is not a luxury for the patient but this is something that we should cover.  So this is something very smart that the company did.  I don’t know if it is published information in the public domain.  I don’t know if there is a formal publication out there.  But it is very, very important in terms of the drug being used in clinical practice.  One way or the other, somebody has got to pay for it, right?  So a drug that is used more because it is shown to be cost effective is a drug which is more lucrative for the company itself.  I think this is the first smart thing that the company has done putting this information out there”.

 

“Dabigatran came in at a price in the US at about six dollars a day. Six dollars and fifty cents.  Yeah, so what I think I am hearing you say is that is probably not sustainable over time? Yes. I agree.  I think the only resistance that I see out there to dabigatran is pricing at the moment.  If it was priced lower and that is what I keep on telling them that what they have to deal with are the payers.  They are not dealing with the payers effectively enough”.

 

“What is the pricing of dabigatran in Canada compared to warfarin in Canada? Well it is much more expensive than warfarin.  But its pricing came in with a very aggressive price of three bucks a day.  I think that is considered to be a very reasonable price considering everything.  I think that it is going to lead to the drug getting onto the provincial health formularies.  In that case the stuff is going to take off.  So they have taken a very aggressive approach.  Most people are not doing that.  They are gouging the marketing.  So we are at $6.25 a day here in the US. Yeah well we are always less than you guys, you know.  And six dollars is not as an aggressive a price.  It is fairly… well, what can we say?  All we can say is “thanks.”

 

 

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