Study: 'Little incentive’ for drugmakers to complete confirmatory trials for accelerated approvals

Cancer drugs recently approved through the US Food and Drug Administration’s (FDA) accelerated approval pathway did not receive a price increase after they went through a confirmatory trial to demonstrate evidence of clinical benefit, according to a recent analysis published in Health Affairs.

The lack of a price increase for drugs approved through the pathway implies there is little financial benefit for sponsors to quickly move forward with confirmatory trials, the authors of the study said.

“This suggests a failure in the market of cancer drugs and undermines a key economic incentive for drug companies to conduct and complete confirmatory trials for cancer drugs approved through the FDA’s accelerated pathway,” Richard G. Frank, PhD, of the Brookings Institute in Washington, D.C., and colleagues wrote in their study.

Frank and colleagues evaluated the price changes of 16 drugs approved through the accelerated approval pathway using surrogate endpoints that went on to receive coverage under Medicare Part B between 2012 and 2018. The date range was chosen because the Food and Drug Administration Safety and Innovation Act (FDASIA) came into effect in July 2012 and allowed for a large timeline for confirmatory trials to take place. Of the 16 drugs analyzed, 69% were biologics, 13 drugs were unique applicants, and there was a total of 39 indications.

The researchers analyzed the status of each drug in June 2021 and found 16 of 39 indications (41%) were converted to regular approval following a confirmatory trial, 19 indications (49%) had confirmatory trials underway, and 4 indications (10%) were withdrawn.

When Frank and colleagues also analyzed the changes in drug prices after a confirmatory trial had been conducted. On average, they found a non-statistically significant increase (0.65%) in average price change over the study period for drugs that completed a confirmatory trial with a positive result after controlling for time and unobserved drug characteristics, while a negative trial result led to a decrease in price of the drug following the results. Overall, no drug was priced under $5,500 and a third of the drugs were priced above $65,000 for a 28-day prescription, the researchers noted.

“[R]egardless of the statistical model, there was no systematic relationship between price and obtaining a positive confirmatory trial during the study period,” Frank and colleagues said.

Improvements to accelerated approval

Since a positive trial result does not significantly impact the price of a drug on the market, and a negative outcome can decrease the drug’s market price, companies have “very little incentive” to conduct confirmatory trials, the authors explained.

One potential solution, Frank and colleagues said, would be to have Centers for Medicare & Medicaid Services (CMS) create an “economic incentive” for companies that quickly complete confirmatory trials, such as a price adjustment under Medical Part B. Another solution is to have FDA enforce the timely completion of confirmatory trials through an act of Congress, noting that the Drug User Fee Act of 1992—which expires in September 2022—may be an appropriate place for Congress to set that expectation for FDA.

“Policy interventions designed by CMS that recognize the uncertainty around the efficacy of accelerated approval products and reward the resolution of that uncertainty can contribute to improved incentives for the completion of confirmatory trials,” Frank and colleagues concluded.

Health Affairs Frank et al.

Study: 'Little incentive’ for drugmakers to complete confirmatory trials for accelerated approvals

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