Last Updated on: 22nd November 2023, 02:00 pm
A groundbreaking study has highlighted the economic potential of precision medicine, offering valuable insights into the return on investment (ROI) for pharmaceutical research and development (R&D). Published in the Journal of Pharmaceutical Policy and Practice, the study, titled “Delivering the precision oncology paradigm – reduced R&D costs and greater return on investment through a companion diagnostic informed precision oncology medicines approach,” explores the economic impact of precision medicine in oncology compared to traditional approaches.
Conducted by a team of precision healthcare economists and researchers, this comprehensive study examines the initial wave of precision oncology medicines in the market. The results provide compelling evidence of substantial cost benefits associated with precision medicine. The findings call for a reevaluation of the commercial model for precision medicines and their corresponding diagnostic/prognostic tests.
Professor Mark Lawler, co-lead of Health Data Research UK’s Big Data For Complex Disease Research Driver Programme and a senior author of the study, emphasises the significance of precision medicine in delivering affordable care for cancer patients. He notes that adopting a precision oncology approach, guided by companion diagnostics (CDx), can result in affordable healthcare, including during the development phase. It reduces expensive clinical trial attrition rates and prevents ineffective treatments with significant side effects. Professor Lawler emphasises that failing to embrace CDx-guided approaches would mean missing a significant opportunity to provide the best and most cost-effective care to patients.
The study reveals that developing an oncology medicine without CDx guidance costs over $1 billion more in R&D compared to a precision oncology approach. This highlights the superior value that CDx-guided precision medicine offers to key stakeholders, including payers, patients, and the pharmaceutical industry.
Professor Richard Sullivan, a co-author of the paper, underlines the economic impact of precision medicine, stating that significant R&D cost savings have already been observed. These savings can be redirected to improve testing and provide greater cost benefits to health systems, thereby reaching more patients.
The study’s lead author, Dr. Raymond Henderson, highlights how a precise health economic approach provides the evidence base needed to support the delivery of precision oncology for patients.
While traditional oncology medicines historically generated higher revenues compared to precision medicines, a previous study revealed clinical practice gaps in CDx testing. Inefficiencies in the diagnostic pathway resulted in less than 50% of eligible patients gaining access to the most effective precision medicines. The precision medicine approach enables pharmaceutical companies to adopt new business models that prioritise robust tumor testing to reach currently untreated patients. This approach also supports equity-based pricing systems and the development of precision oncology medicines that provide significant and clinically meaningful benefits.
Peter Keeling, co-author and CEO of Diaceutics, emphasises the importance of these findings for the pharmaceutical industry. By investing in better testing and recovering patients lost in the diagnostic pathway, significant lifecycle revenues can be achieved for therapies.
Despite the positive evidence supporting the value of precision oncology approaches to payers, patients, and the pharmaceutical industry, barriers still exist that require a new operating model to ensure cost-effective treatments reach all target patients.
This study received support from Health Data Research UK (HDR UK) and funding from Queen’s University Belfast Foundation. The paper is available here.
