Time was that getting a new medicine over the goal line equated to receiving the "green light" for approval from the FDA. In today's environment of government austerity measures and shrinking health care budgets, however, a drug's approval now only represents a "first and goal." To achieve a "touchdown" drug developers are going to have to demonstrate favorable pharmacoeconomics and real-world value for their products.

According to a recent report from PwC's Health Industries practice, performance evidence is redefining the way medications are sold as the health sector undergoes significant transformation. The landscape of how a drug is valued and its developers compensated is changing rapidly.

Its "Drug value in the new health ecosystem" study identifies emerging shifts in healthcare driving this change that include the growth of new payment models now in use by hundreds of hospitals, the formation of accountable care organizations (ACOs), online insurance marketplaces set to open in 2014, and the shift of financial responsibility to consumers.

Although drug makers have been discussing the concept of drug value for several years a "tipping point" has been reached where they now have to provide performance data to new players in the health care system, not only physicians, Jim Prutow, principal, PwC's Health Industries practice, told BioWorld Insight. "Although FDA approval is still important, now companies have to showcase a drug's value to different types of customer."

Robust Networks

As the report points out, success for drug manufacturers in the future will be linked to how well they establish and maintain robust networks that cross traditional boundaries. To keep pace with changing market demands, companies have to look to new kinds of data to help make the "value" case for their products. "This means going beyond traditional clinical trial information, which comes in prior to a product's launch, and instead looking to real-world evidence."

Since performance data is becoming critical in the equation for a therapeutic product's ultimate success in the marketplace, companies are forging partnerships across the drug development value chain, Chris Khoury, senior manager, PwC's Health Research Institute, told BioWorld Insight.

"They are capturing more of the 'voice of the patient' that demonstrates how they are responding to the drug and providing it as evidence to insurers, health systems, and government purchasers."

One of the ways that real world data can be generated is by working with nonprofit medical research organizations. PwC cited the example of Vertex Pharmaceuticals Inc., of Cambridge, Mass., whose 12-year R&D partnership with the Cystic Fibrosis Foundation was widely credited with helping the company gain FDA approval of cystic fibrosis drug Kalydeco (ivacaftor) in less than average drug development time. (See BioWorld Today, Feb. 1, 2012, and June 25, 2012.)

The partnership, the report says, gave Vertex access to experts, trial participants, and rich patient information. In return, the foundation fulfilled its mission of accelerating treatments and extending life for those diagnosed with this genetic disorder.

Companion Diagnostics

Companion diagnostics have been another important recent development in the new healthcare ecosystem since they enable therapies to be targeted to patients who will benefit the most. This trend has accelerated over the past few years with the FDA approving a number of these combinations.

For example, Qiagen NV's Therascreen EGFR RGQ PCR kit recently gained FDA approval alongside Boehringer Ingelheim GmbH's lung cancer drug Gilotrif (afatinib).

The drug was approved specifically for advanced non-small-cell lung cancer (NSCLC) patients whose tumors express the EGFR exon 19 deletions or exon 21 L858R substitution gene mutations. EGFR gene mutations are estimated to be found in about 10 percent of NSCLC cases, with the majority of those expressing the EGFR exon 19 deletions or exon 21 L858R substitution. Qiagen's diagnostic is designed to identify patients with those mutations, who will be likely responders to the tyrosine kinase inhibitor. (See BioWorld Today, July 15, 2013.)

In addition, pharma companies are forging partnerships with diagnostic companies. In July Merck KGaA, of Darmstadt, Germany, said its Merck Serono unit signed an agreement to collaborate with Life Technologies Corp., of Carlsbad, Calif., for current and future companion diagnostics projects. The nonexclusive deal covers an initial project for oncology and provides for a long-term collaboration across a potentially broad range of the Life Technologies instrument platforms and a range of therapeutic areas. (See BioWorld Today, July 17, 2013.)

PwC cites the Patient Centered Outcomes Research Institute (PCORI) as another important player in the new health care ecosystem since its goal is to equip individuals with information to make wise health care decisions. The nonprofit organization was authorized by Congress in 2010. It is using its allocated funding to improving the nation's capacity to efficiently conduct comparative clinical effectiveness research.

For example, it is providing up to $68 million to support development of a National Patient-Centered Clinical Research Network. Specifically, the funding will support Clinical Data Research Networks and Patient-Powered Research Networks, with PCORI funding up to $56 million to support up to eight new or existing CDRNs, and up to $12 million to support up to 18 new or existing PPRNs.

The notion of comparative effectiveness to demonstrate a drug's value has not been lost on drug developers. Boehringer Ingelheim, of Ridgefield, Conn., part of Boehringer Ingelheim GmbH, has just signed a multiyear agreement with Brigham and Women's Hospital to conduct a long-term study to assess comparative effectiveness, safety and prescribing patterns of oral anticoagulants, including Pradaxa (dabigatran etexilate mesylate), to reduce stroke risk in U.S. patients with nonvalvular atrial fibrillation. The objective of the long-term program is to better understand real-world safety and effectiveness of warfarin and newer oral anticoagulants, with Brigham and Women's analyzing claims data from United Health Group's research database (See BioWorld Today, Aug. 16, 2013.)

While it will take a significant amount of time for drug developers to adjust to the rapidly changing health care environment one thing that top company executives can do is to become familiar with who the decision makers are in order to showcase the value of their new therapies, noted Prutow.

Harnessing the power of "Big Data" also will be important because the growth of IT has allowed an exponential growth in the amount of real-world data in health care.

PwC says that being able to mine this data will provide deeper insights into the trajectory of a particular disease and the performance of various therapies.

Certainly it is a new competitive environment and companies will need to adjust their business "playbook" in order to be successful going forward.