Using Avastin for Eye Disorder Could Save U.S. $3 Billion

The U.S. could save almost $3 billion a year if Medicare patients were given Avastin instead of Lucentis to treat two diseases that could lead to blindness, according to a study in the journal Health Affairs.

Both treatments are made by Basel, Switzerland-based Roche Holding AG, and work similarly in treating neovascular age-related macular degeneration and diabetic macular edema by targeting the retinal bleeding and swelling that’s the leading cause of blindness in older Americans. Lucentis, though, costs more than $2,000 per dose, or 40 times more than Avastin.

Treatments for these eye diseases account for about one-sixth of the Medicare Part B budget, according to the report. While the drugs work the same, U.S. regulators haven’t approved Avastin’s use to treat macular degeneration. Still, no rule stops doctors from using it, the researchers said.

“These are big dollars that could be saved for Medicare and patients,” said David Hutton, the lead author of the study and assistant professor of health management and policy at the University of Michigan in Ann Arbor.

The findings come as Italy is seeking $1.6 billion in damages over allegations that Roche and Novartis AG (NOVN), which both sell Lucentis, are colluding in directing patients toward more expensive medicines. The drugmakers may come under a probe in the European Union to see whether the companies are steering patients away from Avastin. France is also investigating.

As populations age, the number of people with age-related macular degeneration may rise 14 percent to 5 million people in the U.S. and Western Europe in 2020.

11 Injections

In the U.S. alone, 3 million people are expected to suffer from the disorder, which can require more than 11 injections a year, the Health Affairs study said. Another 2 million are expected to suffer visual impairment from diabetic macular edema, which requires about nine injections yearly.

Avastin, developed by Roche’s Genentech unit, was first approved by the U.S. Food and Drug Administration in 2004 for metastatic colon cancer and subsequently was cleared for use against other malignancies, including non-small cell lung cancers.

“Genentech doesn’t want you to use Avastin,” Hutton said in a telephone interview. “So they’re never going to go through FDA approval for its use in the eye.”

The company has no plans for a clinical trial program to evaluate Avastin’s use for eye diseases, Allison Neves, a spokeswoman for Roche’s Genentech unit, said in an e-mail.

Different Medicines

“We specifically designed Lucentis for use in the eye and to clear quickly from the bloodstream after leaving the eye to potentially minimize side effects,” she said. “The two medicines were designed for different purposes and, we believe, may have different systemic and ocular safety profiles when used in the eye. We believe that Lucentis is the most appropriate treatment for patients with wet AMD.”

The U.S. Food and Drug Administration has raised concern that Avastin repacked for use against the eye diseases may cause serious infections, even blindness, because of the risk of contamination during the compounding process. Hutton said clinical trials show the rate of infection is very low for Avastin, though there is concern that the compounding process may create impurities that lead to infections.

Nonetheless, some doctors have been using Avastin since 2005 in a form that’s largely obtained from compounding pharmacies, according to Susan Malinowski, an ophthalmologist with Retina Consultants of Michigan in Southfield, Michigan who wasn’t involved in the study

Cost Savings

Her five-physician office saved $55 million in Medicare payments between 2010 and 2013 by using Avastin, she said.

Medicare reimburses health-care providers at the average sales price of the medication, plus an additional six percent. That means profit margins for doctors’ offices can be three times higher through the use of Lucentis, the study said.

“No matter which drug we’re using, we should be paid the same,” Malinowski said in a telephone interview. “I try to use Avastin when I can so that when I’m old and gray there’s some money left in the system to give good care.”

Hutton urged that policy makers find a way to incentivize Avastin use by making reimbursement rates higher for the drug.

Regeneron Pharmaceuticals Inc. (REGN) and Bayer AG’s competing drug, Eylea, costs about $1,800 and is also widely administered, Hutton said. Eylea and Lucentis lead the $9 billion eye-drug market, composing $6 billion in sales in 2013, according to report by Bloomberg Industries.

The office of inspector general of the Department of Health and Human Services issued a report in 2012 recommending that the Centers for Medicare and Medicaid Services establish specific payment criteria for using Avastin for AMD. As of April, the CMS said they were unable to require physicians to use lower-cost drugs.

“Politically it’s difficult to restrict access to Lucentis,” Hutton said.

To contact the reporter on this story: Sonali Basak in New York at sbasak7@bloomberg.net

To contact the editors responsible for this story: Reg Gale at rgale5@bloomberg.net Andrew Pollack

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