Market Access and Pricing in Oncology in Emerging Markets

Introduction

As a consequence of the success of decades of public-health investments and efforts that have reduced the burden of infectious disease, chronic diseases are rising as the top healthcare threat in emerging markets. Likewise, with the rise in GDP and affluence in these markets, a side effect has been the increased prevalence of obesity, diabetes, cardiovascular disease, and diseases associated with aging such as cancer. In Latin America, for example, cancer has become the second leading cause of death, and cancer is now the leading cause of death in China.

Healthcare infrastructure in emerging markets has not kept pace with this rise in cancer prevalence, however. Insufficient government funding, shortage of oncology-trained personnel, healthcare system inefficiencies and fragmentation, inequalities such as urban-rural divides in healthcare access, and restricted access to innovative drug therapies are just a few of the challenges faced in these markets.

Despite these challenges, emerging markets’ increasing need for cancer prevention, screening, early detection, diagnosis, and treatments present opportunities for pharmaceutical and biotechnology manufacturers for both positive impact and revenue growth. Unique considerations and approaches must be taken to succeed in these markets given the challenges faced by all stakeholders – patients, healthcare providers, and payers. We briefly highlight these factors below.

Hurdles to market access

For middle and low income countries, which generally have younger populations and shorter life expectancies, health priorities have historically been focused on childhood and communicable diseases rather than chronic diseases or diseases of aging populations. Also common to many of these countries is the existence of government-provided universal healthcare, often at levels limited to basic healthcare needs and frequently insufficient. Private insurance can be uncommon or unavailable, and limited reimbursement from public healthcare systems can lead to high out-of-pocket health expenditures. Health outcome inequalities and vast disparities in access are systemic problems in emerging markets.

Given limited resources and government healthcare budgets that have not grown despite epidemiological changes, public funding for expensive diseases such as cancer has been deprioritized, resulting in a shortage of myriad resources, from public health awareness campaigns to trained personnel to treatment facilities. Many cancer cases are diagnosed at later stages of disease due to limited access to screening procedures, and for those patients who are diagnosed and seek treatment, access to therapies can be challenging and cost prohibitive, oftentimes resulting in treatment termination. In Ecuador in 2014, for example, 40% of families affected by pediatric cancer discontinued treatment due to financial reasons.

Government healthcare systems are cost constrained and have multiple mechanisms in place to deny or slow access to the most innovative but also most expensive drugs. Regulatory delays are rampant and drug approval processes are inefficient and frequently result in rejections. China, for example, has only 345 registered employees in its drug regulatory agency, the China Food and Drug Administration (CFDA) compared with the United States FDA’s 9,300 employees. This invariably results in approval delays, with the review period for some new medicines taking 14 to 28 months to complete.

Of 49 new cancer treatments that entered the market between 2010 and 2014, only six are available in China, compared with 41 in the U.S. Beyond approval, inclusion on national medicines lists is an additional challenge that drug companies face in some markets. Furthermore, competitive landscapes can be flush with generics and biosimilars, and priority for approval or reimbursement is oftentimes given to local manufacturers. There can be significant downward pressure on the pricing of innovative therapies in these markets, along with the expectation of greater pricing transparency and/or differential pricing.

For cost-containment reasons, some federal payers such as Brazil’s Sistema Único de Saúde (SUS) and Mexico’s Seguro Popular exclude high-cost and targeted cancer therapies – such as trastuzumab (Herceptin) for HER2-positive breast cancer – from coverage. Furthermore, even if approved in a market, access is not guaranteed. In Brazil, the 25% of the population that is privately insured will have access to drugs upon approval, but for the remainder of the population that is reliant on the public health system, coverage of new pharmaceuticals can lag up to a decade.

This stalling tactic has resulted in frequent lawsuits by patients, with 3.3% of publicly-insured cancer patients obtaining their medication through lawsuits against SUS between 2012 and 2014. Another example of an access hurdle that some patients, such as those in Belarus and Kazakhstan, face is a limited, insufficient supply of some approved therapies. These governments only purchase and reimburse a certain quantity of oncology drugs each year, and patients only have access to these treatments while the supplies last.

Patients as payers

Public health insurance in emerging markets is oftentimes limited to basic needs or may be capped to an annual limit – or annual volume, as in the case of Belarus and Kazakhstan – that is insufficient for cancer treatments. Because of these limitations like these and others, the burden of covering the costs of cancer treatment largely falls on the patients in emerging markets, whether in the form of buying private insurance or paying for services and treatments out of pocket.

Due to the price sensitivity of patients and payers in these markets, unique approaches need to be taken to maximize access to therapies. Promotions such as ‘buy X cycles, get one free of charge’ and different size medication packs are examples of some tactics employed by pharmaceutical companies.

In the Philippines, for example, where public healthcare funding does not cover biologics and 80% of the population pays out of pocket for healthcare, Roche has established a program to increase access to Herceptin for HER2-positive breast cancer patients. A third party evaluates the patient’s ability to pay for treatment and then price discounts are set based on their financial status. This discount program has significantly increased treatment and adherence. Medical tourism is another mechanism leveraged by some patients with the physical and financial means to travel.

Patients may travel internationally to seek access to treatments or specialists unavailable in their home country or to higher quality of medical care, while other medical tourists may travel to get comparable procedures or treatments at a fraction of the price they would pay at home.

Lastly, an especially challenging situation found in many emerging markets is the fragmentation of healthcare systems, with many parallel, private providers and payers and limited communication among them. Inevitably, this leads to disparities in screening rates, referrals, quality of care, and access to providers and treatments.

Conclusion

Emerging markets present a large opportunity for improvements and developments in cancer control, as well as growth for pharmaceutical and biotechnology companies, however there are significant challenges that need to be overcome to succeed in these countries. Market entrance and success is not insurmountable, but requires innovative strategies and tactics unique to each market. Key areas of consideration are pricing and reimbursement, regulatory, and infrastructure (e.g., hospitals and clinics, laboratories, and trained healthcare personnel).

In this latter area, an approach such a public-private partnership to establish local or regional laboratories for biomarker testing, or funding scholarships for medical training to increase the number of educated personnel, are example tactics.

On the regulatory front, there needs to be effective cooperation and pressure from multiple stakeholders – patients, advocacy groups, providers, government affairs – in order to expedite approval. Partnerships with local manufacturers, which can effectively navigate the local business environment, including local customs and processes, can be another effective tactic in gaining access to a new market.

With respect to pricing and reimbursement, manufacturer-led negotiations, volume discounts and rebates, pay-for-performance models, and sliding scale discounts, such as the one implemented by Roche in the Philippines, or even donations of products are an effective way to both increase access as well as build brand recognition and goodwill. As an example, Novartis established the Glivec International Patient Assistance Program (GIPAP) in partnership with The Max Foundation to offer assistance to patients in emerging nations in Asia, the Middle East, Central and Eastern Europe, Africa, and Latin America. GIPAP provides imatinib (Glivec) at no cost to eligible patients with chronic myeloid leukemia (CML) or gastrointestinal stromal tumor (GIST). Nearly 50,000 patients from 80 countries benefitted from GIPAP as of 2014.

These tactics are just a few examples of approaches that can increase the potential for successful entrance and growth in these emerging markets and improve patients’ opportunities to be treated with the most efficacious oncologic drugs.