[Reporter’s View] Discuss indication-based pricing

The need for a drug pricing system based on indications, which has been consistently raised by the pharmaceutical industry, is reemerging.

 

Recently, some multinational pharmaceutical companies are preparing to hold a “Discussion on Policies to Resolve Inequality in Innovative New Drugs and Improve Regulations.” In particular, the forum will discuss measures to introduce an indication-based drug pricing system to expand reimbursement for new drugs.

 

The aim is to raise awareness of the problem that only 22% of innovative drugs are covered by health insurance in Korea, which prevents patients from receiving timely treatment.

 

Currently, the domestic drug pricing system is based on a single drug price.

 

Even if a new drug is approved for various indications, all patients are charged the same price.

 

Even if additional indications are added and the drug price is lowered, the lowered price is applied for all indications.

 

The problem is that many expensive new drugs secure multiple indications and then are left non-reimbursed.

 

Recently, many new anticancer drugs have emerged that are approved for multiple indications rather than a single indication.

 

For example, MSD's immunotherapy drug Keytruda is approved for 16 types of cancer, including melanoma, non-small cell lung cancer, head and neck cancer, urothelial cancer, stomach cancer, and breast cancer.

 

Another immunotherapy drug, Opdivo, has been approved for nine types of cancer, and the antibody-drug conjugate (ADC) Enhertu is being used for three types of cancer.

 

However, delays in reimbursement are reducing patients' access to such new drugs.

 

In the case of Keytruda, it passed the Health Insurance Review and Assessment Service's Cancer Disease Review Committee, the first hurdle for reimbursement, on its sixth attempt in February, but 6 of its indications were not included.

 

For new anticancer drugs, insurance reimbursement is a factor directly linked to prescription.

 

Due to the nature of anticancer drugs, they must be administered continuously to prolong the patient's life, but the price of non-reimbursed drugs is immense.

 

The price of the ADC drug Trodelvy is about KRW 1.6 million per vial.

 

Converted to one cycle (21 days, two doses), it costs about KRW 9.3 million, which is close to KRW 10 million.

 

It is known that Enhertu also costs about KRW 7 million per cycle before reimbursement.

 

If a new drug that dramatically increases the survival rate is covered by insurance for some types of cancer but not for others, patients may feel relatively deprived.

 

It is time to start active discussions with patient groups.

 

The government has been holding a cautious stance on the indication-based pricing system.

 

It believes that infrastructure development, such as billing and settlement systems, and prescription distortions could arise, necessitating a long-term approach.

 

Given that South Korea has a single-payer national health insurance system, it is understandable that the government must make various efforts to reduce fiscal expenditures.

 

However, it is also important to consider that multinational pharmaceutical companies, that pursue profits, may hesitate to apply for approval for certain high-cost, low-efficiency indications in the current environment, thereby limiting patients' access to treatment.

 

Recently, high-cost treatments targeting the fundamental causes of diseases, such as immunotherapy, antibody-drug conjugates (ADCs), chimeric antigen receptor T-cell (CAR-T) therapies, and cell and gene therapies, have emerged and more are poised to enter the global market.

 

In particular, patients with diseases that previously had low survival rates are now living longer, and even those with intractable and rare diseases are now able to hope for a complete cure.

 

If these innovative new drugs are not introduced into the country, Korean patients may be forced to seek treatment abroad.

 

To establish reasonable measures tailored to the domestic situation as claimed by the government, efforts must be made to at least conduct pilot programs to assess feasibility.

 

Given that health insurance funds are limited and solutions must be found within existing frameworks, it is not feasible to indefinitely postpone discussions on improving patient access to innovative drugs.

 

Open dialogue between the government and the pharmaceutical industry is now essential to enhance patients' access to new treatments.