Precision Medicines Speed Development and Reduce Healthcare Costs

Published on: 

The use of more targeted therapies is expanding as the public gains access to low-cost genetic testing, and more advanced computer systems are offering data from healthcare systems.

The use of more targeted therapies able to treat patients more effectively and efficiently is expanding as the public gains access to low-cost genetic testing, and more advanced computer systems are offering data from healthcare systems. With some 75,000 genetic tests on the market, more consumers are signing up for personal analyses, and clinicians are ordering genetic lab tests to inform treatment. Problems arise due to uncertainty over how to interpret such test results and concerns about privacy may limit data sharing. Unclear and inconsistent reimbursement policies for genomic tests, moreover, create barriers to advancing precision medicine, as does limited access to testing by certain population subgroups.

Yet, research indicates much promise for the field, as seen in a range of studies from leading researchers and clinicians presented in the May 2018 issues of Health Affairs. Cystic fibrosis (CF) patients with a certain genetic mutation experienced measurable gains from treatment with Ivacaftor (Vertex Pharmaceuticals’ Kalydeco), according to a study conducted by the Cystic Fibrosis Foundation and other researchers. This analysis of administrative claims data showed that improved outcomes reduced hospitalization rates for patients treated with the drug from 2012–2015, with the gains correlated with strong adherence to treatment. The trends continued for use of ivacaftor to treat patients with additional CF gene mutations under indications subsequently approved by FDA. The outcomes reduced healthcare spending more broadly, further demonstrating the value of assessing real world treatment data for innovative treatments.

Precision medicines able to rapidly demonstrate effectiveness for targeted patients also benefit from more expedited development and accelerated approval by FDA. An examination of FDA data for 2013–2017 by researchers in Australia and at Harvard Medical School found that precision medicine studies generate early signals of efficacy and reach the market more rapidly than traditional drugs. Almost half of the precision medicines in the study qualified for FDA’s breakthrough therapy designation and were approved based on fewer pivotal trials and with fewer patients in studies, who were less likely to be randomized, blinded or have placebo controls. Such gains enabled product development and review 1.7 years faster than nonprecision products.

FDA’s Oncology Center of Excellence (OCE) is collaborating with organizations able to capture real-world data on patient treatments and outcomes in electronic health records to better assess the potential benefits or risks of treatment to patients outside conventional clinical trials. By linking clinical records to genomic data from thousands of tumor samples, the analysts sought to identify study populations able to provide generalizable evidence for precision medicine interventions. Achieving such a data infrastructure is highly complex, reported OCE Acting Associate Director Sean Khozin in a case study on linking clinical and genomic cancer data to inform precision medicine use. The analysis in Health Affairs supports efforts to establish data standards and strategies to support data sharing in this area across multiple providers and labs.


The development of more targeted therapies for limited patient populations, though, raise concerns about cost and access. Generic versions of targeted therapies initially did little to bring down the cost of specialty innovators products, according to a Health Affairs study. It found that the list price of imatinib (Novartis’ Gleevec) fell only 10% following the approval of the first three generic versions, largely because physicians continued to prescribe more expensive brand therapies.  

Payers increasingly are turning to value-based payment models in establishing reimbursement for new targeted oncology therapies and other specialty medicines. The Centers for Medicare and Medicaid Services (CMS) reported on how it is exploring methods for adjusting payments under its Oncology Care Model and other alternative payment methods.