Consumers of data about incremental cost-effectiveness ratio (ICER) need to be much more aware of the assumptions underlying its calculations, according to an opinion published in the Journal of Thoracic Disease (2014; doi:10.3978/j.issn.2072-1439.2014.12.41). This awareness needs to arise even as ICER is often presented as an absolute measure of the value of treatment decisions.

Health economics helps insurers, health care systems, and providers make treatment decisions based on the cost of extra units of health arising from a specific treatment. By calculating the cost for each year of life or quality-adjusted year of life gained, these groups can decide whether changing treatments or adding in a new treatment beyond the existing standard of care is worth it.

“Increasingly physicians are being presented with health economic analyses in mainstream medical journals as a means of potentially influencing their prescribing. However, it is only when you understand the multiple assumptions behind these calculations that you can see that they are by no means absolute truths,” said D. Ross Camidge, MD, PhD, of the University of Colorado Cancer Center in Denver.

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Take the case of targeted treatment for non-small cell lung cancer (NSCLC). Treating ALK+ lung cancer with crizotinib rather than with either first- or second-line chemotherapy controls patients’ cancer longer and with fewer side effects, but is it cost effective?

One of the most prominent health economic assessments of crizotinib occurred within a Canadian study which showed that introducing crizotinb for ALK+ lung cancer would cost $255,970 per quality-adjusted life year gained (taking into account screening for the ALK abnormality, the cost of the drug, its benefits and side effects compared to standard second-line chemotherapy). This is above the threshold most insurers will pay and so according to this ICER, crizotinib is not necessarily worth it.

“But what if we change some of the assumptions used in the Canadian model?” asked Camidge and his coauthor, Adam Atherly, PhD, also of Colorado Cancer Center.

Changing from a 50% quality of life, as the Canadian study assumed, to a 90% quality of life, as has been common, dramatically drops the ICER to $143,421 per quality-adjusted life year gained.

Further, in the data used in the Canadian study only the second-line use of the drug was explored, but benefit in the first-line setting now seems to be greater. If use of the drug results in more quality-adjusted life years gained, the drug is less expensive per unit.

Further, the cost of testing has fallen from about $50,000 per treatable case to about $10,000 per treatable case.

As each component in the overall calculation is explored, Camidge and Atherly show that the resulting ICER can change to a greater or lesser extent.

“Something that might seem clear-cut from the outside really gets tricky and much less definite when you pull it apart,” Atherly said. “The cost per unit of health that is used to determine if a drug is or isn’t used seems like an unequivocal fact, but is often highly equivocal.”

“With multiple other examples of giving specific targeted drugs to specific molecular subtypes of disease occurring, it is becoming vitally important to accurately address the health economics of these personalized medicine scenarios. For if we don’t address the feasibility of actually delivering these breakthroughs to patients in the real world, they will not be breakthroughs at all,” they wrote.