Economic Evaluation of Talimogene Laherparepvec Plus Ipilimumab Combination Therapy vs Ipilimumab Monotherapy in Patients With Advanced Unresectable Melanoma | Dermatology | JAMA Dermatology | JAMA Network
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Figure 1.  Markov Health States and Transitions
Markov Health States and Transitions

Patients start in this model at the initiation of treatment in the state of progression-free survival.

Figure 2.  Tornado Diagram for Selected Parameters (1-Way Sensitivity Analyses)
Tornado Diagram for Selected Parameters (1-Way Sensitivity Analyses)

HR indicates hazard ratio; PFS, progression-free survival.

Figure 3.  Cost-effectiveness Acceptability Curves
Cost-effectiveness Acceptability Curves

Curves show the probability of talimogene laherparepvec plus ipilimumab achieving cost-effectiveness per progression-free quality-adjusted life-year gained at various levels of willingness to pay (probabilistic sensitivity analyses).

Table 1.  Input Table for Key Parameters in the Modela
Input Table for Key Parameters in the Modela
Table 2.  Base-Case Analyses (BCA) and Probabilistic Sensitivity Analyses (PSA) Results for Progression-Free Quality-Adjusted Life-Years (QALY) and Objective Response Rate
Base-Case Analyses (BCA) and Probabilistic Sensitivity Analyses (PSA) Results for Progression-Free Quality-Adjusted Life-Years (QALY) and Objective Response Rate
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Original Investigation
January 2019

Economic Evaluation of Talimogene Laherparepvec Plus Ipilimumab Combination Therapy vs Ipilimumab Monotherapy in Patients With Advanced Unresectable Melanoma

Author Affiliations
  • 1Center for Health Outcomes and PharmacoEconomic Research, College of Pharmacy, The University of Arizona, Tucson
  • 2Department of Pharmacy Practice and Science, College of Pharmacy, The University of Arizona, Tucson
  • 3Division of Dermatology, Department of Medicine, College of Medicine, The University of Arizona, Tucson
  • 4The University of Arizona Cancer Center, Tucson
  • 5Division of Hematology-Oncology, Department of Medicine, College of Medicine, The University of Arizona, Tucson
  • 6Division of Medical Oncology, Department of Medicine, University of Washington, Seattle
  • 7Seattle Cancer Care Alliance, Seattle, Washington
  • 8Department of Family and Community Medicine, College of Medicine, The University of Arizona, Tucson
  • 9Matrix45, Tucson, Arizona
JAMA Dermatol. 2019;155(1):22-28. doi:10.1001/jamadermatol.2018.3958
Key Points

Question  Is treatment of patients with advanced unresectable melanoma with talimogene laherparepvec plus ipilimumab cost-effective vs treatment with ipilimumab alone?

Findings  In this economic evaluation, compared with ipilimumab monotherapy, talimogene laherparepvec plus ipilimumab cost an additional $1 481 208 to gain 1 additional progression-free life-year and a supplemental $1 683 191 to gain 1 additional progression-free quality-adjusted life-year. The extra cost to gain objective response in 1 additional patient (out of 100 treated patients) was $1 653 062.

Meaning  Patients treated with talimogene laherparepvec plus ipilimumab achieve objective response, but this comes at an additional cost that is well above what payers typically are willing to pay.

Abstract

Importance  A phase 2 trial comparing talimogene laherparepvec plus ipilimumab vs ipilimumab monotherapy in patients with advanced unresectable melanoma found no differential benefit in progression-free survival (PFS) but noted objective response rates (ORRs) of 38.8% (38 of 98 patients) vs 18.0% (18 of 100 patients), respectively.

Objective  To perform an economic evaluation of talimogene laherparepvec plus ipilimumab combination therapy vs ipilimumab monotherapy.

Design, Setting, and Participants  For PFS, cost-effectiveness and cost-utility analyses using a 2-state Markov model (PFS vs progression or death) was performed. For ORRs, cost-effectiveness analysis of the incremental cost of 1 additional patient achieving objective response was performed. In this setting based on a US payer perspective (2017 US dollars), participants were patients with advanced unresectable melanoma.

Main Outcomes and Measures  The PFS life-years and PFS quality-adjusted life-years were determined, and the associated incremental cost-effectiveness ratios (ICERs) and incremental cost-utility ratios (ICURs) were estimated. Also estimated was the ICER per 1 additional patient (out of 100 treated patients) achieving objective response. Base-case analyses were validated by sensitivity analyses.

Results  In PFS analyses, the cost of talimogene laherparepvec plus ipilimumab ($494 983) exceeded the cost of ipilimumab monotherapy ($132 950) by $362 033. The ICER was $2 129 606 per PFS life-years, and the ICUR was $2 262 706 per PFS quality-adjusted life-year gained. Probabilistic sensitivity analyses yielded an ICER of $1 481 208 per PFS life-year gained and an ICUR of $1 683 191 per PFS quality-adjusted life-year gained. In 1-way sensitivity analyses, the PFS hazard ratio and the utility of response were the most influential parameters. Talimogene laherparepvec plus ipilimumab has a 50% likelihood of being cost-effective at a willingness-to-pay threshold of $1 683 191 per PFS quality-adjusted life-year gained. In ORR analyses, talimogene laherparepvec plus ipilimumab ($474 904) vs ipilimumab alone ($132 810), a $342 094 difference, yielded an ICER of $1 629 019 per additional patient achieving objective response. In subgroup analyses by disease stage and BRAFV600E mutation status, ICERs ranged from $1 069 044 to $17 104 700 per 1 additional patient achieving objective response.

Conclusions and Relevance  The cost to gain 1 additional progression-free quality-adjusted life-year, 1 additional progression-free life-year, or to have 1 additional patient attain objective response is about $1.6 million. This amount may be beyond what payers typically are willing to pay. Combination therapy of talimogene laherparepvec plus ipilimumab does not offer an economically beneficial treatment option relative to ipilimumab monotherapy at the population level. This should not preclude treatment for individual patients for whom this regimen may be indicated.

Introduction

In the United States, 91 270 new cases of melanoma are expected in 2018, and 9320 deaths are estimated to be due to melanoma.1 The national cost of melanoma2 is projected to be $3.16 billion in 2020, a 34% increase from the $2.36 billion national cost in 2010. Five-year survival rates vary based on the melanoma disease stage,3 ranging from 98% for stage 1, to 90% for stage 2, decreasing further to 77% for stage 3, to a low of 10% for stage 4.

While early-stage disease is treated mainly with surgery, advanced and unresectable disease is managed with different therapeutic options.4 These encompass several agents approved in recent years, including BRAF inhibitors (vemurafenib, dabrafenib mesylate, and encorafenib), immune checkpoint inhibitors (ipilimumab, nivolumab, and pembrolizumab), and oncolytic virus (talimogene laherparepvec).5 Combinations of agents with different mechanisms may provide better efficacy, safety, and tolerability.6

In a phase 2, randomized, open-label trial, Chesney et al7 evaluated the efficacy and safety of the combination of intralesional injection with talimogene laherparepvec and intravenously administered ipilimumab vs intravenous ipilimumab alone in patients with advanced unresectable melanoma. While there was no differential benefit in progression-free survival (PFS) (hazard ratio, 0.83; 95% CI, 0.56-1.23), the objective response rate (ORR) for the talimogene laherparepvec plus ipilimumab arm was 38.8% (38 of 98 patients) vs 18.0% (18 of 100 patients) for the ipilimumab-alone arm (odds ratio, 2.9; 95% CI, 1.5-5.5). With adverse event (AE) rates being virtually similar, it was concluded that talimogene laherparepvec plus ipilimumab posed no additional safety concerns of note.

In recent years, the cost of novel cancer treatments has risen at unprecedented rates that arguably are poorly aligned with the differential outcomes achieved.8,9 Pharmacoeconomic evaluation of treatment options enables assessments of the value of medications and medication regimens to inform decision making about formularies, coverage, and reimbursement.10,11 Using the phase 2 data reported by Chesney et al,7 we performed an economic evaluation of talimogene laherparepvec plus ipilimumab combination therapy vs ipilimumab monotherapy in patients with advanced unresectable melanoma from the perspective of public and private US payers (2017 US dollars).

Methods
Patient Populations

The populations were modeled after the patients in the trial by Chesney et al,7 including adults with histologically confirmed stage IIIB to IVM1c malignant unresectable melanoma suitable for injection, measurable disease per computed tomography or calipers, Eastern Cooperative Oncology Group performance status of 0 or 1, and adequate hematologic, hepatic, and renal function. In the combination arm, talimogene laherparepvec was given at a dose of 4 × 106 plaque-forming units or less at week 1, a dose of 4 × 108 plaque-forming units or less at week 4, then every 2 weeks until progression or death, with ipilimumab given at a dose of 3 mg/kg every 3 weeks starting at week 6 for a total of 4 doses. In the ipilimumab-alone arm, ipilimumab was given at a dose of 3 mg/kg every 3 weeks starting at week 1 for a total of 4 doses. The comparative efficacy measures used were PFS and ORR, as reported in the trial by Chesney et al.7

The institutional review board of the University of Arizona determined that this study, being economic analysis based on published data, did not constitute human subjects research. The institutional review board also waived the need for approval.

Model Structure

For the PFS outcome, a state-transition Markov model with 2 health states (PFS vs progression or death) was specified over a lifetime horizon (Figure 1). Patients start in this model at the initiation of treatment in the state of PFS. After the first cycle, 2 states are possible, each with the following estimated probabilities: (1) staying in the same state and being progression free until the next cycle or (2) experiencing progressed disease or death. This is repeated across all cycles until the completion of treatment or death. Kaplan-Meier curves for PFS were digitized, data were extracted, and Weibull distributions were fitted to extrapolate PFS probabilities over a lifetime horizon. The model was applied to cost-effectiveness (cost per life-year gained) and cost-utility (cost per quality-adjusted life-year [QALY] gained) analyses for PFS.

For the ORR outcome, which is time independent, we performed cost-effectiveness analyses of the cost associated with 1 additional patient achieving objective response in an assumed cohort of 100 treated patients. The latter assumption is necessary because ORR is expressed as a percentage and thus assumes a base of 100.

Our analysis is from the US payer perspective. This includes public payers (eg, government health plans, such as Medicare; military/veterans; Federal Employees Health Benefits Programs; and government-initiated programs, such as Accountable Care Organizations and the Medicare Shared Savings Program) and private payers (eg, commercial insurers, health insurance marketplaces, self-insured group health plans, and commercially administered public Medicare plans). Economic estimates are expressed in 2017 US dollars.

Estimation of Incremental Cost-effectiveness Ratios and Incremental Cost-Utility Ratios for PFS

The model was populated with the costs of treatment, medication administration, monitoring, and management of grade 3/4 AEs for each treatment arm, as well as utilities and disutilities (Table 1). Red Book12 was used to obtain the wholesale acquisition cost of talimogene laherparepvec and ipilimumab. The medication administration and monitoring costs were obtained from the Centers of Medicare & Medicaid Services reimbursement fee schedules,13 and the costs of managing grade 3/4 AEs were obtained from the literature14 and adjusted to 2017 US dollars. We assumed that each patient would have 1 physician visit per week, laboratory tests (complete blood cell count with differential, complete metabolic panel, and thyroid function panel) every 4 weeks, and computed tomography scan (chest, abdomen, and pelvis) with contrast every 8 weeks. Costs and effects were discounted at 3% per year beyond 1 year. The utility values quantifying the valued quality of life associated with the health states were obtained from literature.15 The disutility values for AEs, specifying the decrease in the valued quality of life for a given AE, were applied for 1 week for each incident event throughout treatment (Table 1).

In the base-case analyses, we estimated the incremental cost-effectiveness ratio (ICER) per progression-free life-year gained and the incremental cost-utility ratio (ICUR) per progression-free QALY gained. Both probabilistic and 1-way sensitivity analyses were performed to assess the uncertainty around the deterministic estimates. The probabilistic sensitivity analyses included 2000 Monte Carlo simulations using the respective distributions of the model inputs simultaneously (Table 1). The 1-way sensitivity analyses assessed the singular impact of uncertainty on key parameters. Cost-effectiveness acceptability curves plotted the probability of talimogene laherparepvec plus ipilimumab being cost-effective at different willingness-to-pay threshold values.

Estimation of the ICER for ORR

In the ORR-based cost-effectiveness analyses, we considered the maximum follow-up time for each treatment arm in the trial by Chesney et al,7 defined herein as 156 weeks for the talimogene laherparepvec plus ipilimumab arm and 152 weeks for the ipilimumab arm. We estimated the ICER per 1 additional patient achieving objective response in an assumed cohort of 100 treated patients (for reasons of brevity, we also refer to this as “per additional patient achieving objective response”). We performed base-case analyses and probabilistic sensitivity analyses with 2000 Monte Carlo simulations. Analyses were conducted for the populations in the trial by Chesney et al7 in general, followed by subanalyses for patients who are BRAFV600E wild type or BRAFV600E mutant, for patients with stage IIIB/IIIC/IVM1a disease, and for patients with stage IVM1b/IVM1c disease.

Results
ICER and ICUR for PFS

In the base-case analyses, the total cost of talimogene laherparepvec plus ipilimumab was $494 983 vs $132 950 for ipilimumab monotherapy, a supplemental cost of $362 033. For talimogene laherparepvec plus ipilimumab, the progression-free life-years were estimated to be 1.15 vs 0.98 for ipilimumab alone (d = 0.17), and the progression-free QALYs were estimated to be 0.95 vs 0.79 (d = 0.16), where d indicates difference. The ICER for talimogene laherparepvec plus ipilimumab over ipilimumab was $2 129 606 per progression-free life-year gained, and the ICUR was $2 262 706 per progression-free QALY gained (Table 2).

In the probabilistic sensitivity analyses, the ICER was $1 481 208 per progression-free life-year gained, and the ICUR was $1 683 191 per progression-free QALY gained (Table 2). In the 1-way sensitivity analyses, the hazard ratio of PFS and the utility of response were the most influential parameters on cost-effectiveness (Figure 2). The cost-effectiveness acceptability curves revealed that talimogene laherparepvec plus ipilimumab has a 50% likelihood of being cost-effective at a willingness-to-pay threshold of $1 683 191 per progression-free QALY gained (Figure 3).

ICER for ORR

In the base-case analyses for objective response and using the observed rates of 38.8% vs 18.0% (d = 20.8%), the ICER for talimogene laherparepvec plus ipilimumab over ipilimumab was $1 629 019 per additional patient achieving objective response in an assumed cohort of 100 patients (Table 2). In subanalyses, the ICERs were (in ascending order) $1 069 044 per additional patient with BRAFV600E wild type achieving objective response, $1 368 376 per additional patient with stage IIIB/IIIC/IVM1a disease achieving objective response, $2 012 318 per additional patient with stage IVM1b/IVM1c disease achieving objective response, and $17 104 700 per additional patient with BRAFV600E mutant achieving objective response.

The probabilistic sensitivity analyses yielded similar estimates of ORR for the entire sample and for the subgroups of interest (d < 0.01 for all) (Table 2). The probabilistic ICER was $1 653 062 per additional patient achieving objective response. In subanalyses, the probabilistic ICERs were (in ascending order) $1 084 822 per additional patient with BRAFV600E wild type achieving objective response, $1 388 572 per additional patient with stage IIIB/IIIC/IVM1a disease achieving objective response, $2 042 018 per additional patient with stage IVM1b/IVM1c disease achieving objective response, and $17 357 150 per additional patient with BRAFV600E mutant achieving objective response.

Discussion

The combination of talimogene laherparepvec plus ipilimumab results in no marked difference in PFS over ipilimumab monotherapy; however, more patients treated with this regimen achieve objective response. This economic evaluation of combination treatment vs ipilimumab monotherapy demonstrates 3 important findings. First, the small and, at the population level, statistically nonsignificant PFS benefit of combination therapy over ipilimumab monotherapy, coupled with the high incremental cost, yielded cost-effectiveness and cost-utility estimates between $1.5 million and $2.3 million per 1 progression-free life-year or 1 additional life-year or 1 quality-adjusted life-year gained. Second, adding talimogene laherparepvec to ipilimumab requires a high supplemental cost of about $1.6 million to gain 1 additional quality-adjusted life-year free of disease progression or to have 1 additional patient attain objective response. Third, all ICER and ICUR estimates far exceeded commonly used willingness-to-pay thresholds (ie, these additional costs are well beyond what public and private payers typically are willing to pay).

In the absence of a statistically significant PFS benefit, a key clinical question is whether achieving objective response is a relevant marker of clinical benefit. In the registration trial16 for ipilimumab in melanoma, an aggregate ORR of 7.04% was observed among patients receiving ipilimumab. The registration trial17 for ipilimumab in melanoma reported an ORR of 7.04% among patients receiving ipilimumab. With due caution about comparing results across different trials, the ORR of 38.8% for patients treated with talimogene laherparepvec plus ipilimumab combination therapy in the trial by Chesney et al7 reflects at least an additive objective response effect. However, while improvement in ORR provides a measure of biological activity and was an appropriate primary end point, its clinical significance is unclear, especially in the metastatic setting, where time-to-event analyses (most importantly progression and death) provide information that is more readily translated into clinically useful terms.

These results are important when assessing clinical benefit and cost. For both PFS and ORR, our incremental cost-effectiveness estimates converge at about $1.6 million to attain 1 incremental unit of benefit (1 progression-free life-year, 1 progression-free QALY, or 1 additional patient attaining objective response). This is well beyond the prevailing willingness-to-pay threshold ranges.18 To address this imbalance in cost and outcome, either talimogene laherparepvec plus ipilimumab must be priced at considerably lower cost or another clinical benefit must be demonstrated, such as increased overall survival. More generally, the objective should be to encourage pricing of therapy to better match the demonstrated effect so that price points align with therapeutic benefit.

A central premise in our pharmacoeconomic studies is that findings should inform policy and not set it. Hence, we decline to interpret pharmacoeconomic results against (the often arbitrary, unadjusted, poorly rationalized, or nontransparent) criteria and thresholds that some stakeholders may adopt. A long-held standard is the $50 000 per QALY gained in the United States (and its equivalent of £30 000 per QALY gained in the United Kingdom), which dates back to the 1972 expansion of the US Medicare system to include end-stage renal disease; this has not been adjusted for inflation.19 The QALY is an economic construct that assumes that patients’ preferences, clinicians’ treatment patterns, and payers’ willingness to pay are consistent across the health states and time, although in reality these may vary by disease, treatment options, and prognosis.20-22 The ICERs and ICURs in our economic evaluation are population-level estimates based on the aggregate PFS and ORR point estimates reported by Chesney et al.7 They do not reflect that patients in both arms varied in PFS (some shorter, some longer, and many in between) and objective response (some responded, while some did not). On an individual basis, there may indeed be patients for whom talimogene laherparepvec plus ipilimumab is an appropriate treatment, a decision that should be made in light of the best available information and cognizant of the cost implications. There may be subgroups of patients for whom treatment with talimogene laherparepvec plus ipilimumab may be a cost-reasonable approach, such as patients with stage IIIB/IIIC/IVM1a and patients with BRAFV600E wild type.

The recent rapid development and adoption of novel cancer therapies has not necessarily been coupled with analyses of their wider economic implications and the development of alternate markers to justify treatment cost. As noted in the 2018 report of the President’s Cancer Panel,9 the escalation in the cost of cancer treatments places significant burdens on patients and payers and, through rising out-of-pocket expenses, intensifies the potential of “financial toxicity” for patients with cancer and their families. The panel made the following recommendations: to replace current cancer treatment pricing with value-based or outcome-based pricing, to use payment models that incentivize clinicians and health care organizations to use high-value drugs, and to minimize the contributions of drug costs to financial toxicity for patients and families, as well as for payers to encourage patients to choose treatments with high-value drugs and for clinicians and health care organizations to include cost information when communicating with patients about treatment options.

This calls for novel definitions of value, methods of valuation, and markers to justify treatment cost in cancer care, especially if outcomes like survival and longevity are not the primary markers of clinical benefit. The challenge is to move beyond cost, to adopt a workable definition of value, to operationalize and quantify value, and to integrate patient experience.23,24 The proposal by Porter24 to define value as the health outcomes achieved per dollar spent may be intuitively appealing but remains to be fully operationalized. Five clinically oriented frameworks assess value in cancer care.25 The American Society of Clinical Oncology value framework,26,27 the European Society for Medical Oncology Magnitude of Clinical Benefit Scale,28 and the National Comprehensive Cancer Network Evidence Blocks29 focus on clinical benefit, toxicity, and quality of life, but only the American Society of Clinical Oncology model ties this to cost. Within a classic ICER and ICUR approach, the Institute for Clinical and Economic Review30 attempts to integrate care value and health systems value. Finally, the Memorial Sloan Kettering Drug Abacus31 estimates the theoretical price of a treatment and compares this with market prices.

Several of the above 5 clinically oriented frameworks, together with the QALY-based approach, consider safety and tolerability a negative that requires a downward adjustment of the benefits of a treatment. This overlooks the reality that most cancer treatments have more (and more severe) safety and tolerability issues compared with general medicine treatments. Therefore, applying similar utilities and disutilities for cancer as for general medicine ignores the fact that patients with cancer tend to be more willing to accept AEs, including severe AEs, in return for effective treatment and positive outcomes, even if these are time limited. Current thinking is evolving toward economic evaluation methods that do not “penalize” the progression-free or life-extending benefits for the inherent AEs. Instead, clinical outcomes and AEs are considered as a whole and are compared with the combined costs of treating the disease and managing the AEs of this treatment.

Our study has limitations. The efficacy and safety data were from a phase 2 trial. Not unlike many other economic evaluations, we did not have access to the actual survival data of the Chesney et al7 trial and had to digitize the survival curves. Several of the above clinically oriented frameworks, together with the QALY-based approach, consider safety and tolerability a negative that requires a downward adjustment of the benefits of a treatment. This overlooks the reality that most cancer treatments have more (and more severe) safety and tolerability issues compared with general medicine treatments. Therefore, applying similar utilities and disutilities for cancer as for general medicine ignores the fact that patients with cancer tend to be more willing to accept AEs in return for effective treatment. Current thinking is evolving toward economic evaluation methods that do not “penalize” the progression-free or life-extending benefits for the inherent AEs. Instead, clinical outcomes and AEs are considered as a whole and are compared with the combined costs of treating the disease while managing the AEs of this treatment.

Conclusions

With its therapeutic benefit limited to objective response and not PFS and with cost-effectiveness estimates converging at about $1.6 million per incremental unit of benefit, combination therapy of talimogene laherparepvec plus ipilimumab does not offer an economically beneficial treatment option relative to ipilimumab monotherapy at the population level. However, this regimen may be indicated for individual patients. Further investigation of talimogene laherparepvec as monotherapy or in combination with other agents should focus on means to improve its therapeutic benefit. Price points should be adopted that more realistically reflect the demonstrated benefit of the drug.

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Article Information

Accepted for Publication: September 11, 2018.

Corresponding Author: Ivo Abraham, PhD, Center for Health Outcomes and PharmacoEconomic Research, College of Pharmacy, The University of Arizona, 1295 N Martin Ave, Drachman Hall, Room B306H, Tucson, AZ 85721 (abraham@pharmacy.arizona.edu).

Published Online: November 21, 2018. doi:10.1001/jamadermatol.2018.3958

Author Contributions: Drs Almutairi and Abraham had full access to all of the data in the study and take responsibility for the integrity of the data and the accuracy of the data analysis.

Concept and design: Almutairi, Alkhatib, Curiel-Lewandrowski, McBride, Abraham.

Acquisition, analysis, or interpretation of data: All authors.

Drafting of the manuscript: Almutairi, Alkhatib, Babiker, McBride, Abraham.

Critical revision of the manuscript for important intellectual content: Almutairi, Oh, Curiel-Lewandrowski, Babiker, Cranmer, Abraham.

Statistical analysis: Almutairi, Alkhatib, Oh, Abraham.

Administrative, technical, or material support: Almutairi, Alkhatib, Oh, Curiel-Lewandrowski, Babiker, Cranmer, Abraham.

Supervision: Abraham.

Conflict of Interest Disclosures: Drs Curiel-Lewandrowksi, Babiker, Cranmer, and McBride reported receiving funding from Amgen. Dr Abraham reported owning stock in Matrix45, Belgamis, and ExAnte International. Matrix45 has received funding from Amgen. As an employee of Matrix45, Dr Abraham cannot hold equity in sponsor and client companies or perform services or receive compensation independently from sponsor and client organizations. No other disclosures were reported.

Disclaimer: Dr Abraham is the Associate Editor for Quantitative Methods of JAMA Dermatology but was not involved in any of the decisions regarding review of the manuscript or its acceptance.

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