Medicare Expenditures of Atezolizumab for a Withdrawn Accelerated Approved Indication

The US Food and Drug Administration (FDA) grants accelerated approval for products that address serious or life-threatening illnesses that fill an unmet medical need¹; such products, which are initially approved using clinical surrogate end points, are then required to demonstrate clinical benefit through confirmatory trials. While the program has been praised as an important means to bring new products to market, the pathway has also been criticized as setting unacceptably low standards governing market entry or expansion.² In addition, accelerated approval raises the prospect that payers will incur expenditures for products or indications that are ultimately withdrawn. In March 2021, drug manufacturers withdrew indications for 4 oncology drugs after confirmatory trials failed to demonstrate clinical benefits.³ We quantified 2018 and 2019 US Medicare expenditures for 1 of these indications, atezolizumab as a second-line treatment for malignant urothelial carcinoma. While this indication received accelerated approval in October 2016, the manufacturer’s confirmatory trial did not identify benefits.⁴

We performed a retrospective cohort study using a 20% restricted sample of 2018 and 2019 Medicare fee-for-service (FFS) claims. This analysis was exempt from Johns Hopkins Bloomberg School of Public Health institutional review board approval because it did not constitute human participants research. We first identified Part B institutional outpatient claims using atezolizumab’s designated Healthcare Common Procedure Coding System code. Next, we used the diagnosis codes from the claims to select patients with a diagnosis of malignant urothelial carcinoma. We then identified claims in which atezolizumab was a second-line treatment based on a patient’s previous treatments for urothelial carcinoma. We replicated the algorithm to identify Part B noninstitutional outpatient claims using the carrier files. Finally, we aggregated total claim payments and beneficiaries’ coinsurance amounts.

For 2018 and 2019, we found 14 182 Medicare FFS claims for atezolizumab (Table). Of these, 161 159 (8.8%) were for second-line treatment of malignant urothelial carcinoma, representing 157 unique beneficiaries. The mean (SD) Medicare payment per claim was $6854 ($1843). The mean (SD) beneficiary coinsurance per claim was $1724 ($1325). The mean (SD) total payment per claim was $8579 ($2245). Extrapolating our 20% sample to the full Medicare FFS population, we estimated in 2018 and 2019 there were approximately 6200 paid claims, representing $46 million in Medicare spending for atezolizumab for an indication with no confirmed evidence of clinical benefit.

While the FDA’s accelerated pathway may hasten products to market, it also comes with costs borne by payers for products with indications that are ultimately withdrawn or rescinded because of lack of evidence. This study examined 1 such indication, atezolizumab as a second-line treatment for urothelial carcinoma. We found that a single payer, the US Medicare program, spent $46 million in 2018 and 2019 for this indication. We assessed only direct economic costs of drug treatment. There are other costs that individuals may have incurred, including opportunity costs of alternative, foregone treatments, and potential financial and chemical toxic effects of atezolizumab treatment. The primary limitation of our study was the use of International Statistical Classification of Diseases and Related Health Problems, Tenth Revision codes listed on each Medicare claim to identify the prescribed indication of atezolizumab. The diagnosis codes reflect the patient's diagnosis but may not represent the prescribed indication of the drug.

Given that 6% of oncologic accelerated approved indications have been withdrawn,³ one could argue that this is just a cost of getting drugs to treat patients sooner. However, nearly half of accelerated approvals lack confirmatory evidence.⁵ Use of this pathway allowed the FDA to grant accelerated approval for aducanumab, which by some estimates may cost the Medicare program $29 billion annually.⁶ This raises the question as to who should bear the costs of treatments that are administered for accelerated approved indications that are ultimately withdrawn or rescinded because of a lack of confirmatory evidence. Policy options include prospective and retrospective discounts based on confirmatory trials, manufacturing plus markup pricing, or economic impact analyses to limit the exposure of payers to drugs used for indications with no confirmed benefits. In this instance, manufacturers might refund the Medicare program atezolizumab revenue that was associated with the withdrawn indication.

Accepted for Publication: July 27, 2021.

Published Online: September 23, 2021. doi:10.1001/jamaoncol.2021.4757

Corresponding Author: Jeromie Ballreich, PhD, MHS, Department of Health Policy and Management, Johns Hopkins Bloomberg School of Public Health, 624 N Broadway St, HH303, Baltimore, MD 21205 (jballre2@jhu.edu).

Author Contributions: Dr Ballreich had full access to all of the data in the study and takes responsibility for the integrity of the data and the accuracy of the data analysis.

Concept and design: Ballreich, Moore.

Acquisition, analysis, or interpretation of data: Ballreich, Bennett, Alexander.

Drafting of the manuscript: Ballreich, Bennett.

Critical revision of the manuscript for important intellectual content: Ballreich, Moore, Alexander.

Statistical analysis: Ballreich, Moore.

Supervision: Ballreich.

Conflict of Interest Disclosures: Drs Ballreich and Moore reported grants from Arnold Ventures during the conduct of the study. Dr Alexander reported being a past chair and current member of the US Food and Drug Administration’s Peripheral and Central Nervous System Advisory Committee, a cofounding principal and equity holder in Monument Analytics, and is a past member of OptumRx's National P&T Committee. No other disclosures were reported.

Funding/Support: Arnold Ventures LLC.

Role of the Funder/Sponsor: The funder had no influence on the design and conduct of the study; collection, management, analysis, and interpretation of the data; preparation, review, or approval of the manuscript; and decision to submit the manuscript for publication.