September 10, 2018
5 min read

Cost-effectiveness and common sense

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Big-picture trends from ASCO’s most recent clinical practice survey — published in July with 2017 data — reflect ongoing consolidation in health care, with a further reduction in the total number of oncology practices and a slight increase in practice size.

The overall distribution of oncology practices nationally correlates closely with the cancer burden in each area, although there is still an apparent mismatch in terms of oncology service provision in rural areas.

Cost consequences

The analysis of practice pressures reveals some interesting differences between academic practices, hospital/health system-owned practices and physician-owned groups but — predictably — pressures related to payers, staffing, competition, clinical research and electronic health records were dominant to various degrees in all practice settings.

John Sweetenham, MD, FRCP, FACP
John Sweetenham

When the report drills down specifically into payer pressures, there is remarkable consistency in all practice settings. Prior authorization, coverage denials and appeals, and peer-to-peer requests are becoming increasingly burdensome and — especially for physician-owned practices — timeliness of payment is a major concern.

None of this is surprising. In many respects, it is a consequence of the increasing costs and the robust financial margins associated with cancer care.

For example, the rate of acquisition of private oncology practices by hospital systems is higher than for most other subspecialties. Although this may, in part, reflect increased competition for patients, the high revenues generated by oncology practices are likely to be another driver of this trend.

Rising costs are at the heart of the increasing burden of prior authorization, denials and peer-to-peer reviews, which are now a routine part of oncology practice. The impact of these issues for oncologists and for patients is becoming more apparent.

The AMA estimated that prior authorization issues consumed more than 16 hours each week for primary care and subspecialty practices.

Most of us have patients whose staging evaluations or treatment has been delayed waiting for insurance approval. In my own practice, peer-to-peer review for staging CT/PET is now common, and approval for some costly drugs can take many days — and sometimes even weeks.

The impact of these delays on our patients is unknown, but they certainly add anxiety and stress in an already difficult situation.

It’s tempting, but not accurate, to blame these challenges exclusively on payers. Responsibility for the current situation is shared between many stakeholders, including us as oncologists. We are uniquely positioned to help in controlling the escalating costs and administrative burden of oncology practice by judicious use of new imaging modalities and treatments based on their efficacy and cost-effectiveness.


We also are uniquely challenged by our need to balance the individual benefit of a particular intervention for our patients against the broader societal consequences of “uncontrolled” ordering and prescribing. Sometimes this can be very difficult, but there are some situations in which common sense should be able to guide us to a responsible and reasonable decision that is in everyone’s best interest.

The case of ibrutinib

As an example, I was intrigued to read a report in Blood Advances regarding the cost-effectiveness of ibrutinib (Imbruvica; Pharmacyclics, Janssen).

No one would deny that ibrutinib has been a game-changer for many patients with B-cell neoplasms — especially those with chronic lymphocytic leukemia, and particularly those with poor-risk disease.

Ibrutinib is now licensed as a first-line therapy for all patients with CLL, irrespective of risk factors or age. In fact, based on the results of the large, randomized RESONATE-2 trial — which compared ibrutinib with chlorambucil — National Comprehensive Cancer Network lists ibrutinib, along with chlorambucil/obinutuzumab (Gazyva, Genentech), as a category-one option for frontline treatment of patients with CLL aged 65 years and older.

Barnes and colleagues investigated the cost-effectiveness of ibrutinib in this context, compared with chlorambucil alone. The choice of chlorambucil as the comparator in this analysis is likely to overestimate the relative cost-effectiveness of ibrutinib, because chlorambucil is an inferior therapy — a category-three option in the NCCN guidelines — and is very inexpensive compared with ibrutinib.

Despite this, the authors estimated that the incremental cost-effectiveness of ibrutinib compared with chlorambucil is $189,000 per quality-adjusted life-year (QALY) gained. The cost of ibrutinib would need to be reduced by about 50% to reach an accepted willingness-to-pay threshold, even when judged against a much less effective alternative. When compared with a more effective comparator, such as chlorambucil/obinutuzumab, the cost would need to be lowered even more because the incremental benefit is less.

Whatever one’s opinion or level of understanding of QALYs may be, this is a common clinical scenario.

I frequently see newly diagnosed patients aged older than 65 years with low- or intermediate-risk CLL who require therapy. For most, the option now lies between oral ibrutinib — given for an indefinite period until disease progression or unacceptable toxicity — vs. chemoimmunotherapy for 6 months followed by observation only.

Presented with these alternatives — after a detailed discussion about the benefit and toxicity of both therapies, the option of “crossover” for relapsed or progressive disease and the relative cost of the two treatments — most patients opt for a combination therapy of finite duration and cost.


This represents a well-informed, common-sense decision, especially because many of these patients will enjoy very prolonged remissions with chemoimmunotherapy and may never require a second-line or later option. Although not central to the decision-making process, the cost-effectiveness data are certainly useful confirmation that this is a reasonable approach.

There is a major need for similar data in many other contexts.

The European Hematology Association Annual Congress in June featured a presentation about the use of a checkpoint inhibitor in advanced-stage Hodgkin lymphoma. Not surprisingly, these drugs are active in the frontline setting in Hodgkin lymphoma, but evaluating such drugs in untreated patients is very challenging.

The ECHELON-1 study — which evaluated the substitution of bleomycin with brentuximab vedotin (Adcetris, Seattle Genetics) in the ABVD combination — is a good example of this. This study demonstrated a modest improvement in modified PFS for the brentuximab-containing arm, and the results of this study have led to approval of brentuximab for first-line therapy.

For various reasons, this result has not changed practice at most large centers, largely because the standard of care for advanced Hodgkin lymphoma has changed over the period of the study based on the use of interim functional imaging, rendering the control arm less relevant to present practice.

The addition of brentuximab to this tried-and-tested frontline regimen results in a substantial increment in cost for a relatively small incremental gain in outcome. That said, the slight reduction in relapse rate and toxicity associated with brentuximab could be practice changing if cost-effectiveness studies showed that the incremental cost of the drug could be offset by less second-line therapy and less cost due to treatment of late complications.

Need for tools

As pointed out in an excellent editorial by Peter Bach, MD, MAPP, there are pitfalls in cost-effectiveness analysis.

Expensive drugs that produce marginal improvements in outcome have become a reality in oncology, especially with many of the newer immuno-oncology and targeted agents. As a new agent comes along that represents a modest improvement over its predecessor, the incremental cost of the new agent can seem relatively low, even though the actual cost can be very high. In this situation, a cost-effectiveness analysis based on incremental cost increase can make a mediocre drug look good against its comparator.

Without question, we need better tools to inform us about cost and cost-effectiveness. ASCO’s value framework and NCCN’s evidence blocks represent initial constructs that undoubtedly will be refined in coming years and incorporated into decision-support tools.


Real-world data, additional clinical trials and common-sense interpretation of the information we already have should help us to make good decisions in the interest of our patients. This will help reduce costs, relieve payer pressures and, hopefully, save us and our staff from endless phone conversations advocating for treatments with minimal or no benefit.


Bach PB. N Engl J Med. 2015;doi:10.1056/NEJMp1512750.

Barnes JI, et al. Blood Adv. 2018;doi:10.1182/bloodadvances.2017015461.

Kirkwood MK, et al. J Oncol Pract. 2018;doi:10.1200/JOP.18.00149.

For more information:

John Sweetenham, MD, FRCP, FACP, is HemOnc Today’s Chief Medical Editor for Hematology. He also is senior director of clinical affairs and executive medical director of Huntsman Cancer Institute at The University of Utah. He can be reached at

Disclosure: Sweetenham reports honoraria from Seattle Genetics.