Blog | 2/1/2024
Commercial Challenges of Precision Medicine in Oncology
By Heather Loring, PhD, Arpit Dave, PhD, Ashley Peake, Earl Gillespie, PhD, Gary Gustavsen, and Vivek Mittal, PhD
Promise of Precision Medicine in Oncology
Precision medicine approvals account for more than a third of all new molecular entity (NME) drug approvals from the past five years and oncology indications account for over half of biomarker-based therapies approved during the same timeframe.1 These approvals follow a long history of biomarker-directed therapy, beginning with the landmark approval of Herceptin (trastuzumab) for HER2-positive breast cancer in 1998.2 To date, over 2.3MM patients worldwide have received Herceptin as part of their treatment regimen and peak annual sales were $8.0B USD in 2018.3
Non-small cell lung cancer (NSCLC) is another prominent example of the success of biomarker-targeted therapies. The success of EGFR inhibitors, such as Tagrisso (osimertinib), and ALK inhibitor Alecensa (alectinib), demonstrate the value of genetic testing and subsequent biomarker-directed therapy in NSCLC. Now approved for both adjuvant and 1L metastatic disease, Tagrisso generated 2022 global revenue of $5.4B,4 making it AstraZeneca’s top selling drug. Genetic testing is a mainstay of treatment selection for metastatic and recurrent disease with guideline recommendations in the US, EU, and Japan suggesting broad molecular profiling prior to first-line therapy as about two-thirds of patients harbor a known driver mutation.5,6 Minimum testing recommendations include EGFR gene mutations, KRAS, ALK fusions, ROS1 fusions, BRAF mutations, MET exon 14 skipping mutations, RET fusions, and PD-L1 expression due to the availability of targeted therapies. Additional testing (e.g., NTRK gene fusions, MET amplification, ERBB2 mutations, and TMB) is considered optional given the emergence of novel targeted therapeutics.
Implications of Mutation Frequency on Commercial Opportunity
While there has been considerable success with biomarker-directed therapy, novel agents targeting small subsections of the population have seen substantially greater commercial challenges. Success stories around EGFR (~32% of patients worldwide)6,7 and ALK (~5% of patients worldwide)6,8 highlight the viability of two of the most frequent driver mutations in NSCLC. Despite these success stories, it can be difficult to realize a substantial return in these biomarker positive patients if relegated to later lines of therapy as the eligible patient pool diminishes. Blueprint Medicines recently deprioritized investment in EGFR-driven NSCLC after the data failed to support eventual first-in-class placement. Niche biomarkers that are implicated in <5% of NSCLC (e.g., ROS1 rearrangements (1-2%)9, BRAF V600E (1-2%),10 RET (1-2%)11, and NTRK (~0.2-0.3%)12,13 face a similar commercial challenge. The theoretical peak annual revenue on a class basis in the US is limited to ~$600MM for ROS1, BRAF V600E, and RET and ~$100MM for NTRK, compared to ~$2B+ for ALK positive NSCLC and other more frequent biomarkers (assuming an average annual price of $200,000). Therefore, biomarkers that represent <5% of the patient population start at a commercial disadvantage even before diagnosis and testing rates are considered.
Although niche biomarkers face a lower ceiling on commercial opportunity, the gap between more prevalent and niche biomarkers is accentuated by biomarker testing dynamics. Testing rates from twelve community practices from 2020-2022,14 demonstrated that EGFR (67%) and ALK (64%) are more frequently assessed in stage IV lung cancer patients relative to niche mutations like RET (55%) and NTRK (46%) (Figure 1).
The lower testing rates directly impact the addressable patient population and realizable commercial opportunity. For example, Roche acquired Ignyta and its NTRK/ROS1 targeted asset, Rozlytrek, for $1.9B in 2017 with enthusiasm from analysts and reporters alike – “Ignyta will likely prove a bolt-on buy and comes as Roche is trying to stave off biosimilar competition” and “we see an attractive opportunity for Rozlytrek in NTRK positive solid tumors alone, driven by NSCLC and CRC.” Come 2022 with $86MM in actual revenue for Rozlytrek, Roche took a $340MM write-down in the form of asset impairment to address lower sales expectations and adjust asset book value.15 In this case, the companion diagnostic was not approved until several years after the initial drug approval, which no doubt slowed adoption as potentially addressable patients were not identified. A similar story was seen with Roche returning its licensed RET-targeted therapy, Gavreto, to Blueprint in 2022 and taking a $760MM impairment charge due to its lagging sales.15,16 Approximately a year after Roche returned the rights of Gavreto, Blueprint disclosed it would cease global development and marketing of the asset outside of the US and China. These stories exemplify the commercial challenges faced by niche biomarkers today and beg the question of how to develop a winning strategy targeting these populations.
Limitations of Biomarker Testing
With the development of faster, multiplexed, and more cost-effective genomic testing, we have seen increased testing of niche mutations in NSCLC over the last few years (Figure 2).
This is largely driven by the enhanced use of NGS-based biomarker testing, with records indicating an increase from 28% to 68% of patients receiving NGS testing from 2015 to 2020.17 Testing rates in community practices for niche biomarkers are similar to that of NGS testing rates, with 57% of patients receiving NGS testing and only 55% evaluating ROS1,14 suggesting that testing for these niche biomarkers outside of NGS panels is rare (Figure 1). Although niche biomarker testing continues to grow, it has not yet reached the frequency of more canonical biomarkers. These low testing rates likely contributed to modest revenue totals and recent write-downs as fewer patients were identified and treated than analyst predictions assumed. This in turn implies that companies developing precision medicine drugs in niche populations must proactively plan to address testing gaps or risk lower than expected addressable populations.
Despite advancements in technology and resources, considerable limitations still constrain the adoption and implementation of biomarker tests. Addressing these limitations involves how best to connect novel clinical information to inform patient care. Specifically, there is a lack of availability of clinician-friendly decision support services as well as a clinician consensus on biomarker utility and application. New efforts to generate resources are underway to address this developing need with the systemization and application of data atlases in the clinical setting. By consolidating extensive genomic information into an organized resource, the atlas will facilitate dissemination of information on less widely recognized biomarkers and inform clinical decision making.18 Beyond the lack of clinician resources, long turnaround times and incomplete insurance coverage deter broader use of testing, particularly for biomarkers that have a lower probability of a positive result.
The good news is that although testing rates for niche biomarkers lags more prevalent mutations today, accumulating evidence is supporting the use of multi-gene panels, which will drive increased diagnosis of niche cancer types going forward. For example, a recent study indicated 38% of patients tested with NGS resulted in detection of a positive biomarker compared to only 26% from single gene tests.19 In addition to higher detection rates, clinicians will likely follow recent guideline changes such as the European Society for Medical Oncology (ESMO) recommendation to routinely leverage NGS to inform treatment of advanced lung, prostate, and ovarian cancers. Decreases in sequencing costs and expedited turnaround times will expand access as well. Finally, the insurance coverage outlook is consistently evolving with increased legislation prompting revision of commercial policies and, in some states, Medicaid policies as well. More than a dozen US states recently enacted legislation to require broad insurance coverage for biomarker tests and continued activity is anticipated in 2024.20 Together, these factors will identify additional patients who could benefit from targeted therapies and lead to a more favorable commercial outlook in the US.
Despite the progress in the US, biomarker testing still faces considerable challenges ex-US, particularly for niche markers. Although single marker testing is more broadly accessible, availability of NGS varies across countries. 21 Access to NGS remains limited in some cases, like western Europe, despite ESMO guidance. Reimbursement for biomarker testing is also incomplete, particularly for more novel or niche biomarkers. These dynamics are exemplified by revenue projections for targeted therapies that indicate ~60% of Tagrisso sales will be realized from international markets in 2028, compared with only 40% for the niche targeted therapy, Retevmo (Figure 3).
Although many factors compound to produce this differential, a key causal element is the added hurdles ex-US, which result in broader adoption of testing for more canonical biomarkers like EGFR. To circumvent potential barriers, pharmaceutical companies sometimes resort to paying for testing in certain markets to promote diagnosis of relevant patient populations and adoption of targeted therapies. A strategy companies employ to identify and solve these problems early-on is companion diagnostic leakage mapping. Going forward, it will be instrumental for niche precision medicine companies to develop ex-US companion diagnostic strategies to see meaningful commercial returns beyond the US market.
Navigating the Future of Precision Medicine in Oncology
While certain targeted therapies have faced commercialization challenges, both from a logistics and adoption standpoint, precision medicine therapies continue to expand the armamentarium for oncology and improve patient outcomes. As populations become more targeted, identifying eligible patients becomes more critical to maximize return on investment. In the current state, targeting populations that represent <5% of major tumor types has not proven to be a winning commercial strategy. To improve success of future launches, ensuring access to and broad adoption of testing will be crucial to unlocking returns in niche cancer types, like NTRK. Promoting broader adoption of NGS testing, supporting guideline inclusion, and advocating for further revision of coverage policies could facilitate these objectives, especially for meaningful uptake ex-US. By tailoring commercial launch strategies to address these limitations, companies have the opportunity to capitalize on both novel biomarker populations and those that previously fell short of expectations.
References
1 PMC 2022 Personalized Medicine at FDA
2 Patel 2020 Cancers
3 2019 Roche 10K
4 2022 AZ 10K
5 Datamonitor Healthcare 2023 NSCLC
6 Werutsky 2016 J Thoracic Onc
7 Zhang 2016 Oncotarget
8 NCI 2017 FDA Approves Alectinib
9 Gainor 2013 Oncologist
10 Ahn 2023 Medicina
11 Novello 2023 Oncologist
12 Marchetti 2022 Pathologica
13 Manea 2022 Annals of Medicine and Surgery
14 Evangelist 2023 Journal of Clinical Oncology
15 2022 Roche 10K
16 Liu 2023 Fierce Pharma
17 Hess 2022 JTO Clinical and Research Reports
18 Henry 2017 ASCO Educational Book Volume 37
19 Sheffield 2023 Current Oncology
20 Fox 2023 Healthcare IT News
21 Normanno 2022 EJC
Authors
Heather Loring, PhD, is a consultant and member of the Biopharma and Precision Medicine Practices at Health Advances.
Arpit Dave, PhD, is a Senior Analyst and member of the Biopharma Practice at Health Advances.
Ashley Peake, is a Senior Analyst and member of the Biopharma Practice at Health Advances.
Earl Gillespie, PhD, is a Senior Director and Leader of the Biopharma Practice at Health Advances.
Gary Gustavsen, is a Partner and Managing Director of the Precision Medicine Practice at Health Advances.
Vivek Mittal, PhD, is a Partner and Managing Director of the Biopharma Practice at Health Advances.