Understanding the financial and clinical value of oncology drugs has become increasingly important, especially as global spending on these drugs is expected to rise. The retrospective study, spanning from 1995 to 2020, delves into the added benefit of oncology drugs approved by the European Medicines Agency (EMA) and their corresponding revenues. With rising concerns about the efficacy and cost-benefit balance, this study provides crucial insights into the pharmaceutical landscape.
Misalignment of Incentives The study reveals a significant observation: many oncology drugs, particularly those approved through expedited pathways, offer minimal or no added clinical benefit. Despite this, they often manage to recover research and development (R&D) costs within a short period. Francine Brinkhuis, the lead author, comments, “It was surprising to find that even drugs with negative or non-quantifiable added benefit managed to recover their costs so quickly.”
Drugs with negative or non-quantifiable added benefit accounted for 41% of the 458 ratings in the study. These drugs, while approved to address unmet medical needs, raised questions about the balance between regulatory approvals and actual clinical benefits. “Our study underscores the importance of reassessing how we incentivize drug development,” Brinkhuis adds.
Recovery of R&D Costs Remarkably, 91% of drugs in the study recovered their estimated R&D costs within eight years. On average, the median time to offset these costs was only three years, which raises concerns about the pricing of these medications. “While the ability to recover costs quickly might be seen as a success for the industry, it is also a clear signal that the incentives may not be aligned with delivering the most beneficial treatments,” notes Wim Goettsch, another key contributor to the study.
The study further revealed that oncology drugs with higher added benefit ratings tended to generate greater revenues. However, drugs approved through conditional marketing authorizations often generated lower revenues and took longer to offset R&D costs. “This difference in financial performance based on added benefit highlights the need for policies that better reward meaningful innovation,” Goettsch states.
Policy Implications The study’s findings have significant implications for health policy. Current regulatory pathways, especially expedited ones, may not always align with the goal of delivering high-value treatments to patients. The authors suggest that further collaboration between regulatory authorities and reimbursement bodies could help incentivize the development of drugs that provide substantial clinical benefits.
Aukje Mantel-Teeuwisse emphasizes the role of parallel joint scientific consultations between regulatory and health technology assessment agencies. “By aligning evidence requirements and assessment criteria earlier in the process, we can ensure that the drugs reaching patients offer real value,” she says. This approach could help reduce the number of drugs with limited clinical benefits entering the market, ultimately improving patient outcomes.
Call for Action The study calls for a reevaluation of the current incentive structures within pharmaceutical regulation. It highlights the importance of developing policies that prioritize patient outcomes over quick financial gains. “Pharmaceutical companies are likely to respond to the incentives set by regulators. If we want to see more high-value treatments, we need to structure these incentives accordingly,” concludes Brinkhuis.
Citation:
Brinkhuis F, Goettsch WG, Mantel-Teeuwisse AK, Bloem LT. Added benefit and revenues of oncology drugs approved by the European Medicines Agency between 1995 and 2020: retrospective cohort study. BMJ. 2024;384. doi:10.1136/bmj-2023-077391.
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