Drug-Diagnostic Development Stymied by Payer Concerns - Applied Clinical Trials

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Drug-Diagnostic Development Stymied by Payer Concerns

Source: Applied Clinical Trials

The shift to personalized medicine, which supports medical treatment tailored to individual patient characteristics, has been hindered by uncertainty over the value, accuracy, and clinical utility of companion diagnostic tests. Even for the handful of drugs approved by the Food and Drug Administration with labeling that links prescribing to specific biomarker measures, health plan operators, providers, and payers frequently question the need to cover the added testing, according to analysis by Joshua Cohen of the Tufts Center for the Study of Drug Development (CSDD). Cohn noted at a recent CBI conference on “Precision Medicine and Companion Diagnostics” that only a few therapies have been approved by FDA with co-developed tests to inform prescribing; several more drugs gain links to specific diagnostics post-approval.

A main reason for slow drug-diagnostic co-development is uncertainty about the FDA regulatory process for bringing such combination products to market. Different rules and procedures govern drugs and medical devices (which includes in vitro diagnostics), and limited FDA authority over laboratory-developed tests (LDTs) further muddies the picture. Ideally, manufacturers and regulators would like to bring a personalized medicine and its companion diagnostic to market simultaneously, but this has proved to be very challenging. There’s even debate about whether to use the term “personalized” or “precision” to describe new drugs with biomarkers that can identify patients most likely to respond to treatment—or to suffer adverse reactions.

Furthermore, FDA approval of a companion diagnostic does not ensure coverage or sufficient reimbursement for the product, noted consultant Sheila Walcoff of Goldbug Strategies at the CBI conference. Health plan coverage of such tests is “limited and haphazard,” said Cohen, and Medicare Part B plans routinely cover drugs, but don’t always specify a test or assessment. Only a minority of payers require any documentation from providers that a diagnostic has been conducted prior to prescribing, even when a companion diagnostic is on the drug label and recommended or required by FDA.  

FDA is in the process of updating guidance for approval of companion diagnostics and continues to work on a long-anticipated advisory on drug-diagnostic co-development, noted Pamela Bradley, a member of the Personalized Medicine Staff in FDA’s Center for Devices and Radiological Health (CDRH). FDA is trying to improve the review of drug-diagnostic combinations through regular inter-center consultations, particularly on product labeling. The regulatory process for approving new in vitro diagnostics, Bradley explained, relate to risk of harm to patients from inaccurate test results, as opposed to the broader focus for new drugs on product safety, efficacy and quality. Most companion diagnostics will require prior review by CDRH, and Bradley’s office aims to keep that in line with the drug approval timeline.

Ultimately, the one-drug/one-diagnostic development model is not sustainable, Bradley observed, and disease-based platforms able to assess panels of drugs with common diagnostics may be more efficient. More cost-effectiveness research documenting how companion diagnostics can improve health outcomes also can “close the evidence gap,” said Cohen. These and other strategies are key to supporting coverage decisions that will boost the shift to more precise use of personalized medicines.

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