ASCO Town Hall Brings Tense Conversation About Drug Pricing

At the American Society of Clinical Oncology’s (ASCO’s) Annual Meeting, held May 31-June 4, 2019, in Chicago, Illinois, the organization held a town hall meeting to discuss the topic of drug pricing. The town hall was set up in the format of a fireside chat, with moderator Jeffrey Ward, MD, FASCO, hematologist at the Swedish Cancer Institute, joined by Rodney Whitlock, PhD, of McDermott+Consulting.

Drug pricing seemed like an appropriate topic for ASCO's town hall as the Trump administration has made lowering the cost of medications a major objective. By doing so, the administration has put out a series of proposals looking to address the cost of drugs, such as the International Pricing Index (IPI), and the recently finalized rule around direct-to-consumer advertising for pharmaceutical companies.

“What we have is 3 different types of issues out there that you see policymakers discussing. There are blockbuster drugs coming out with significant price tags attached, speculation issues around astronomical drug price increases given the ‘villian made-for-our-time Martin Shkreli,’ and finally, there’s regular drug price increases where drug companies raise their prices in January. Why? Because it’s January. And then again in June. Why? Well, because it’s June,” said Whitlock.

However, the issue of drug pricing is one that has not yet been linked to a single direct, sure-fire cause. It’s no secret that patients are feeling the effects of out-of-pocket costs of drugs, whether it’s in copays or co-insurance costs, but who is to blame? “There’s a tremendous amount of ‘not it’ and finger pointing going on. Drug makers want you to believe that the issues are the $700 aspirins at the hospital— that it’s everyone but them. But on the other side you see other stakeholders who set the prices and they’re also saying it’s not them, but we don’t know because it’s not a transparent system,” he said.

When asked if he believes the politics will change around whether or not the government should have a place in instituting drug prices, Whitlock said that there’s definitely been a renewed interest and openness now to say that if the marketplace isn’t working for consumers under the current system, then the government will come in and set pricing.

“An example would be, look what’s happening with surprise billing. Congress has given that great interest and once they heard about it, they took it on and basically said ‘well then, let’s just stop this right now,’” said Whitlock. “It’s a gateway drug to larger price controls. Once you do it there, can’t you go other places to set price controls? I mean, the government has been doing that in the Medicare space for quite some time now.”

With regard to the IPI model, Whitlock offered a word of caution for what the drug companies’ response to such a model would be. He hypothesized whether the companies will try to get underneath the IPI and raise costs in other countries, so as to not lose money in the United States, or would they simply accept the lower payments?

“[This is something] that hasn’t been discussed with this issue. It’s the point that there is clearly a trade issue at hand here. Other countries are able to tell drug companies, ‘You have to sell at this price to sell in our countries.’ Now, yes, drug companies could get out of [the problem the IPI poses] by raising the prices in other countries. But what isn’t being addressed—and this is truly a trade issue– is the inability of drug companies to raise prices in other countries even a nickel,” said Whitlock.

So, the question remains, what will the administration do in regard to the IPI? Though there was a final rule put out, the rule has yet to take an effect. Whitlock floated the notion that with this proposal, and others, the administration is using it as a bargaining chip for what may come together in the fall as a larger deal with Congress. Or, perhaps not. Either way, Whitlock stressed that healthcare stakeholders need to pay attention to what’s happening in Washington and stay clued in as to what’s to come. “As they say, if you’re not at the table, you’re on the table.”

In an attempt to bring the conversation back to the oncology stakeholders in the room, Michael Kolodziej, MD, vice president and chief innovation officer at ADVI Health, Inc, poised his question in earnest: “We as oncologists are floating on the Titanic, and we’re worried about what the next song the orchestra will play because all of the stuff we’ve been doing forever is going to become incredibly irrelevant as we move into combination I-O [immune-oncology] therapy, CRISPR [Clustered Regularly Interspaced Short Palindromic Repeats], and CAR T [chimeric antigen receptor]. These are therapies that will cost, per patient, $500,000 to $1 million…Help me understand why we’re not interested in pursuing outcomes-based contracting— through a model, through legislation, anything– because as we move technology forward, and the prices will go up with that advance, we need to find a way to pay for it.”

Whitlock’s response largely explained what healthcare stakeholders already know: policymakers really don’t understand how this world works. “The core mission of the FDA in approving a drug is safety and efficacy. That’s it. The FDA is not in any way tasked to determine whether or not drugs have comparative value or that they meet a certain outcome-based type metric. CMS, their core task is to pay the freaking bills,” he said. “So, when you talk about the 2 federal agencies most capable of engaging the conversation you just raised—which is critically important– you first need to grasp how utterly [incapable] they are at raising the conversation because they don’t have the skill set to do it.”

Rather than taking on the challenge and bringing the suggestion back to Washington, DC, with him, Whitlock participated in a little finger-pointing himself, calling on the stakeholders in the room and ASCO members to push the conversation forward. “Moving in the direction of value, we are so far removed from that. Don’t wait on the federal government. If you as an organization want to drive that conversation, you’re better equipped than waiting for someone else at the ‘mothership’ in Baltimore where CMS is located to come up with the idea,” Whitlock said.