Analysis Shows Most EMA-Approved Oncology Drugs Recover R&D Costs, Irrespective of Added Benefit

Francine Brinkhuis, MSc

Although the added benefit of approved oncology drugs in the European Union (EU) varies, the majority have been able to recoup their research and development (R&D) costs, irrespective of added benefit, according to Francine Brinkhuis, MSc. Established added benefit is also less common for drugs approved through expedited pathways, according to Lourens T. Bloem, PharmD, MSc.

In a retrospective cohort study published in The BMJ, which was co-authored by Brinkhuis and Bloem, findings showed a significant proportion of oncology medications authorized by the European Medicines Agency (EMA) from 1995 to 2020 were found to provide minimal or no added benefit to patient outcomes, which was particularly observed in drugs which were granted expedited approval.

Among the added benefit ratings analyzed (n = 458), 41% of drugs were found to have negative or nonquantifiable benefit. Additionally, the median time to offset median R&D costs was 3 years; however, the median time to offset median R&D costs was 4 years for drugs approved under conditional marketing authorizations. Notably, 91% (n = 50 of 55) of evaluable drugs recovered R&D costs within 8 years.

“There has been a lot of literature [showing] that oncology drugs do not always show a benefit; particularly for drugs that are approved through expedited pathways. On the other side, we see that the spending on oncology drugs is very high,” Brinkhuis reported in an interview with OncLive^®.

“We do not often see a large added benefit [with expediated drug approvals]. However, a lot is still paid for these products,” Bloem added.

In the interview, Brinkhuis and Bloem expanded the methods used to conduct the retrospective cohort analysis of the added benefit and revenues of oncology drugs; highlighted the association between these drugs, added benefit, and their cost; and expanded on the discrepancies between their findings across the different approval pathways of the European Medicines Agency (EMA).

Brinkhuis is a PhD candidate in the Division of Pharmacoepidemiology and Clinical Pharmacology of the Utrecht Institute for Pharmaceutical Sciences at Utrecht University in the Netherlands. Bloem is an assistant professor of Clinical Therapeutics at the Centre for Clinical Therapeutics of the Division of Pharmacoepidemiology and Clinical Pharmacology at the Utrecht Institute for Pharmaceutical Sciences.

OncLive: What inspired you to evaluate the added benefits and revenues for approved oncology drugs within the EU?

Brinkhuis: There are a lot of questions [surrounding] whether we are paying for drugs that show added benefit [vs SOC treatments] and are beneficial to patients. It's a balance between costs, which are very high, and [understanding] the uncertainties around the true added benefit to patients. This inspired us to link those to one another. There has been a lot of previous research done into the prices of drugs. We also wrote in our article that the public list prices are not the [actual] prices that are paid for the drug because of confidential discounts. That’s why we chose to do an analysis based on these revenues.

Bloem: That was perfectly summarized. We do not often see a large added benefit [with expedited drug approvals]. However, a lot is still paid for these products. We asked what the underlying evidence is here.

Could you elaborate on how you developed your added benefit system to classify evaluable drugs for this research?

Brinkhuis: We looked at all oncology drugs that were approved by the EMA between 1999 and 2020. We wanted to get added benefit ratings for them to collect as much information as possible. We selected 7 organizations, and we looked on their websites or at their reports to find their evaluation on added benefit.

We wanted evaluations that were closest to market approval that was there during the initial approval of the drug. We collected the true rating that an organization gave, and then we converted those ratings to our own 4-point scale. There are a lot of different scales that [the organizations] are using. For example, the Haute Autorité de Santé in France has a 5-point scale with 5 levels of added benefit, whereas the Gemeinsamer Bundesausschuss from Germany has 6 or 7 levels of added benefit. Therefore, we wanted to convert [different ratings to] an equal scale.

Another discussion point was if we would calculate an average [added benefit] per drug, or if we would keep all the ratings as they were. We saw that the ratings of an individual drug [could] vary a lot. One organization may have given a positive rating, whereas another had a negative rating. That's why we decided to keep the ratings as they were and then analyze them, instead of calculating the average or the median. We saw the value in these varying data, and we did not want to lose that variation. Our analysis was based on all the added benefits ratings as a whole.

Could you walk through some of the key findings that were derived from this investigation?

Brinkhuis: We collected 458 added benefit ratings, and of those, 41% were negative. Those evaluations indicated that there was either no added benefit, or that the added benefit could not be quantified [due to] a lack of [evidence]. We also looked at different approval pathways, and we found that for [agents approved through] expedited pathways, there was [a higher rate of] negative/unquantified added benefit ratings.

For our analysis on revenue, we looked at a [median] estimate of R&D costs. We looked at the revenues of [the drugs] included [in the study] and calculated the time that it took them to recover those R&D costs. We saw that more than half of our included drugs had recovered those R&D costs within 3 years, and that's quite fast. Additionally, we saw that for the drugs that are approved via expedited pathways, this took about 4 years, so this was approximately the same.

We linked the analysis of added benefit to our findings on revenues, and we saw that, in general, products that had higher added benefit also generated more revenue. In essence, this could [incentivize] pharmaceutical companies to develop products with high [added] benefit, because they generate more revenue. However, we also see that products without added [or quantifiable] benefit also generate sufficient revenue to recover their R&D costs within a few years. Maybe pharmaceutical companies are already content with the revenue that is generated from these lower-value products. Those were the main findings.

Bloem: I fully agree. The interesting point that we added was this difference between standard authorization and expedited authorization. Even though there are fewer data for expedited [approvals], they recoup their R&D costs quite swiftly, on median, only 1 year later than [standard approvals].

Were there any surprising findings that you encountered in your research?

Brinkhuis: The most surprising finding was the link between added benefit and revenue. [It was surprising that] these drugs, no matter how much added benefit they have, [allowed] companies to recover their R&D costs within just a few years. This finding was the same for expedited approvals, even though they clearly showed lower added benefit ratings, so this was also surprising.

Bloem: To put this into perspective, the storyline is that pharmaceutical companies often have, for instance, an 8- to 10-year period that they need to recover their R&D costs, including the failure of previous R&D costs of other medicines [that were not approved], which is something that we included in our estimate. That's also quite a big contrast. We were surprised by the findings, as well as the general statement that's being made.

Reference

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(e077391). doi:10.1136/ bmj-2023-077391