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Erleada's reimb and lower coinsurance rate raise issue
by Eo, Yun-Ho Mar 28, 2023 05:56am
Most latecomer drugs are priced at a lower level than first-comer. This is an essential element in Korea's reimbursement listing system. However, a rare occasion occurred where patients are complaining over the lower price set for a latecomer drug. The drugs that arose as an issue were Janssen Korea’s prostate cancer treatment ‘Erleada (apalutamide),’ and Astellas Korea’s ‘Xtandi (enzalutamide)’ which was listed for reimbursement before Erleada. The situation goes as follows. The price difference (list price) between the two drugs is not large. However, the problem lies in the listing registration system the two drug companies selected and the patient's coinsurance. In August of last year, reimbursement for Xtandi was extended through a selective reimbursement system. Xtandi was first listed in 2014 as a treatment for metastatic castration-resistant prostate cancer (mCRPC). The selective reimbursement system is a system for listed drugs that authorities determine is urgent to expand coverage. To rapidly extend the scope of reimbursement for such drugs, the authorities waive the economic feasibility evaluation process but differentiate the copayment rate for the drug. Xtandi met the purpose of the system for the 'metastatic hormone-sensitive prostate cancer (mHSPC)' indication, which was why Astellas chose to receive reimbursement through the system. However, the situation was different for Erleada. As a newly listed new drug, Erleada did not have the option to choose selective reimbursement, therefore, it had to undergo the essential reimbursement processes, including the pharmacoeconomic evaluation process. This was why the time to the listing of the two drugs differed significantly. The two drugs passed review by the Cancer Disease Review Committee of the Health Insurance Review and Assessment Service in February last year, but Erleada is only being listed for reimbursement starting next month. Applying selective reimbursement to new drugs has remained a long-cherished desire in the industry. The different reimbursement tracks taken by the two companies led to the difference in the amount paid by patients as coinsurance. Xtandi’s coinsurance rate under the selective reimbursement system is 30%, whereas the rate is a mere 5% for Erleada which is applied essential reimbursement and special calculation of exemptions. If so, it would seem that existing patients can opt to use the cheaper Erleada, but it is impossible for patients taking Xtandi to switch to Erleada under the current reimbursement standards. In other words, dissatisfaction is arising among patients as existing patients could not benefit from the use of a cheaper drug option that became available. However, no one is to blame for the situation. Aside from the company's strategy, Astellas quickly offered a reimbursed treatment option in mHSPC through the selective benefit system. Janssen also has no fault. The prevailing view had been that it would be difficult for anticancer drugs with the mHSPC indication to be listed for reimbursement in Korea. This was why the news that Janssen completed final negotiations and successfully receive reimbursement after receiving pharmacoeconomic evaluations was received with surprise in the industry. Also, a solution does exist. The gap caused by the difference in coinsurance rates can be resolved if Xtandi also receives pharmacoeconomic evaluations and switches to an essential reimbursement like Erleada. However, it is unclear whether such a decision can be made quickly due to the nature of multinational pharmaceutical companies. A pricing official in the industry said, “Although it is uncommon, we should not overlook the fact that this can happen again in the future. Institutional improvement is needed to resolve the out-of-pocket burden that occurs with the entry of latecomers for selective benefit-applied items.”