This Blogpost was first published on the 21st of January, 2010.
This author would like to express his gratitude to the Partners Healthcare Center for Personalized Genetic Medicine and the Harvard Medical School for their invitation to author this perspective on the 2009 Personalized Medicine Conference at the Harvard Medical School, Boston, MA, on the 18th and 19th of November, 2009.
An abridged version of this blogpost has been published within Helix - the official newsletter of the Harvard Medical School – Partners Healthcare Center for Personalized Genetic Medicine in February, 2010.
The fall of 2009 presented an interesting milestone for Personalized Medicine given the focus on healthcare reform, not only in the USA but across the world at large. Perhaps never before have we seen such a sustained impetus on measurably improving quality of treatment for patients, and ensuring superior therapeutic outcomes, while driving down the total cost of treatment. Against this backdrop of often contentious and partisan debates, landmark reforms with potentially far reaching impact looming large and the unquestionable need to improve the quality of healthcare while lowering costs, the relevance and the reality of Personalized Medicine received close scrutiny, seminal discussion and multi-disciplinary focus at the 2009 Personalized Medicine Conference, held at the Harvard Medical School in Boston, on the 18th and 19th of November, 2009.
Dr. Raju Kucherlapati, the founder of the conference and the Paul Cabot professor of genetics at the Harvard Medical School set the tone for the conference with his opening remarks. Given that the sequencing of the human genome was completed in 2003, he pointed out that attendance at the P/M conference has increased from 237 attendees in 2002 to 601 in 2009, a 3X increase over 7 years, as a key lagging indicator of success. Given the need to deliver better healthcare for the entire population at a lower cost of healthcare delivery, P/M is a key enabler and is happening now – hence the theme of the 2010 conference.
Dr. Kucherlapati alluded to the support for P/M from key constituents like President Obama, the late Senator Ted Kennedy, Secretary Kathleen Sibellius and the Genetic Non-Discrimination Act currently in place, as a key enabler of P/M. According to him, there was significant regulatory pressure to ensure that patients that will respond to drugs and treatment be proactively identified, using tools like bio-markers or companion diagnostics, to ensure the highest efficacy of treatment delivered. These diagnostics are playing a significant role as well as the data re: the sequencing of the Human Genome. He suggested that the $ 1000 genome sequencing price point may actually be around the corner to render this affordable and accessible to almost everyone. Key questions and concerns he enumerated as basis for discussion included reimbursement models that would be critical to success for the early innovators, as well as sustained availability of risk capital, and a robust IT infrastructure to accelerate P/M innovation.
Setting the stage: What is Personalized Medicine (P/M)? Why is it significant for Patients today?
In his introduction of the now re-named Partners Center for Personalized Genetic Medicine (PCPGM), formerly the Harvard Medical School –Partners Healthcare Center for Genetics and Genomics, Dr. Scott T. Weiss, Interim Scientific Director, PCPGM and Professor of Medicine, Harvard Medical School, Brigham and Women’s Hospital defined P/M in the current context as, “Personalized medicine (P/M) is the application of genomic or molecular data to better target health care delivery.” [Click here for Dr. Weiss' presentation]
Dr. Gary Gottlieb, President, Brigham and Women’s Hospital, President and Chief Executive Officer-Designate, Partners HealthCare System in his opening remarks further qualified P/M as “a tool to move from a system of fragmentation of data and healthcare delivery to a fabric that runs across the country and delivers healthcare that is specific to the needs of patients i.e. a plan for each person that is individualized for him/her”. This implies delivering treatment to patients that is proactive, predictive, personalized and participatory unlike the status quo today.
The core objective of P/M is to ensure the best, exact treatment possible for the patient specific to his or her needs, with minimal errors.
The Promise of P/M – The Real World Impact of Personalized Medicine in Enhancing Quality of Life in Patients
Aligned with the theme of this year’s P/M conference, the Panel Discussion that followed the keynote, articulated some of the most promising success stories delivering real value to patients today:
1. Xdx (Expression Diagnostics) developed a non-invasive diagnostic test for heart transplant patients for “acute cellular rejection,” with sufficient clinical data and validity to enable confidence in its adoption and assure “event free survival” and better quality of life. Having appropriate reimbursement for the companion diagnostic, with clear basic guidelines, would go a long way to assure its continued success.
2. El Camino Hospital in California, with self-employed physicians who are not part of an integrated or academic medical center, has seen early success with web-based clinical support for physicians, genetic counseling for patients, and fully imbedded IT that includes computerized physician order entry and electronic medical records.
3. GlaxoSmithKline developed a companion diagnostic product to predict patient’s risk vs. benefit with the underlying drug product for HIV treatment resulting in a 60% decrease in adverse reactions to the drug based on the results of the diagnostic.
4. CVS Caremark announced a relationship with Generation Health, a young genetics benefits management company, through which they will make a large number of genetic tests, that are appropriate for CVS’ tens of millions customers, available and accessible. They plan to launch their combined operation in the Spring of 2010.
5. Medco Health Solutions undertook a series of trials to assess the value of genetic/genomic tests that could ensure its patient customers receive effective treatments with minimal adverse effects. They reported that thousands of its clients have benefitted from such tests.
6. DNA Direct and Humana have partnered to develop a program that will help physicians understand how genetic counseling can help Humana’s patient customers experience better treatment outcomes at potentially lesser cost than they might otherwise experience.
7. bioMérieux announced an agreement with GlaxoSmithKline to develop a predictive test, based on emerging biomarkers, to help clinicians select the most appropriate treatment for different sectors of breast cancer patients.
The discussion identified uncertainty of third party reimbursement as the biggest barrier to adoption of P/M. As well, the investment in the diagnostic tests upfront vs. the total cost of treatment and clear demonstration of superior therapeutic outcome is still a barrier in most cases. There is a need for compelling return-on-investment (ROI) to be unequivocally demonstrated. El Camino Hospital and similar success stories are clearly precedent setting for further innovation and scale up with P/M.
Further reinforcing the promise of P/M in his keynote address while receiving the Personalized Medicine Coalition’s Fifth Annual Award for Leadership in P/M, Brooke Byers, Partner, Kleiner Perkins Caufield and Byers, and a leader in driving innovation in this arena, spoke about “visualizing Personalized Medicine” and its real-world impact on improving the quality of life and/or therapeutic outcomes for patients.
He articulated these three exemplars of success which were vividly etched in his mind:
1. A lady patient diagnosed with breast cancer using the results of a diagnostic test with her physician to make the determination of whether she should undergo chemotherapy or not, given the extremely low (less than 5%) efficacy of chemotherapy in the treatment of breast cancer.
2. A general practitioner with 1,000 patients using a diagnostic test to determine which 50 (5%) of those patients are likely to convert to type 2 diabetes, and then prescribing appropriate treatment and medication to prevent the onset of the disease.
3. Female patients using cost-effective, and relatively risk-free diagnostic tests to determine the onset or extent of coronary artery disease (CAD) vs. having to undergo risky and expensive angiograms to arrive at similar conclusions.
A visionary and a pioneer in fostering innovation in this arena, Brooke expressed hope and optimism that the early successes with P/M can be scaled up despite the barriers and the roadblocks, and urged collaborative efforts across all the key stakeholder communities to accelerate the current pace and momentum.
State of the Union – Where are we Today with P/M?
The sessions analyzing and articulating the current state, reality and challenges of P/M presented three unique yet complementary points of view: a microeconomic snapshot, a policy and political viewpoint and the Innovator’s (the Pharma and Diagnostic industry) perspective as summarized below:
I. Microeconomic Perspective:
According to McKinsey and Company:
- Adverse drug events for patients drive $45-135 billion in incremental costs each year in the US of which, approximately 25% is avoidable, through appropriate use of diagnostics and bio-markers.
- $292 billion was spent on drugs in 2008 of which approx. 50% was ineffective.
This raises the questions:
- Why aren’t pharmaceutical companies more aggressively pursuing companion diagnostics?
- Why aren’t payers actively driving the adoption of personalized medicine?
- Why has physician adoption of some clinically validated tests been slow (and required a large sales force)?
McKinsey and Company cited the results of its survey of almost 100 stakeholders across pharma manufacturers, payers, regulators, providers, diagnostics manufacturers, analysts and venture capitalists:
- Payers were generally skeptical and did not perceive personalized medicine as a priority at this time. They are challenged by the lack of information on cost efficacy as well as longitudinal accounting visibility and patient movement (patients only average 3-4 years on one payer plan).
- Providers showed variable interest since reimbursement is activity/procedure based and billing is not standardized and scalable at this time.
- Pharmaceutical manufacturers are seeing a steady increase in use of personalized medicine (companion diagnostics and bio-markers) with pockets of opportunity and variable investment levels. Cost savings in development are unlikely. Market share is the largest swing factor, as well as pricing upside potential.
- Diagnostics manufacturers are excited about molecular diagnostics, with significant investments in targeted areas and focusing on capturing elusive “full value”. They are constrained by the tradeoffs between the companion diagnostic model that captures a lower relative value at a lower risk vs. the ‘stand-alone’ model that while potentially assuring higher value capture, comes with significantly higher risks as well as high upfront investments, uncertain approval regimes and uncertain payer adoption.
II. Political and Policy Perspective:
Healthcare is a high stakes issue for President Obama given the unsustainable cost curve but the reform process is still highly contentious and partisan. Regulation has come a long way over the last three years and will move forward independent of the current healthcare reform.
Reimbursement for personalized medicine is another issue to be addressed through regulation. Universal health insurance coverage and eliminating exclusion of pre-existing conditions are key enablers to funding companion diagnostics and genetic testing. Demonstrating clear value in terms of higher quality, lower costs, higher patient safety and lower total cost of treatment is critical to enabling reimbursements and driving large scale adoption of personalized medicine.
III. Innovators’ Perspective:
Development of bio-markers and companion diagnostics is very expensive. Identification of the best targets and the best bio-marker before Phase 3 need to be addressed, as do complexities of clinical trial design. A path for simultaneous approval of drugs and diagnostics would be a significant step forward. Getting sufficient tissue samples from patients for the genetic testing is a significant constraint.
What are the most significant Challenges to large scale adoption of P/M? How can these challenges be addressed?
Given the current landscape for P/M, what are the most significant challenges and how can these be addressed to pave the way for patient and physician adoption, scale up and ubiquity i.e. a not-so-distant scenario where indeed, medicine becomes “Personalized Medicine”.
A. Reimbursements and Payments
The discussion identified uncertainty of third party reimbursement as a serious barrier to adoption of personalized medicine. Similarly, the upfront investment in the diagnostic tests vs. the total cost of treatment and clear demonstration of superior therapeutic outcome is still a barrier in most cases. There is a need to see clear linkage between genetic testing and clinical outcomes as well as a search for clearly demonstrated and compelling return-on-investment to be unequivocally demonstrated. Can personalized medicine prove that it will lower the cost of healthcare or demonstrate comparable healthcare value? Can comparative effectiveness data show what is the most effective and the most economic treatment to assure the best therapeutic outcome for patients?
B. Lack of integration of Electronic Health Records and Healthcare IT
In a keynote address Dr. John Glaser, Vice President and Chief Information Officer, Partners HealthCare System, and Senior Advisor to the Office of the National Coordinator for Health Information Technology at HHS, noted the very low adoption rates of Electronic Medical Records and Electronic Health Records (EHRs) (only 13% for large hospitals and 3-5% of small physician’s offices). To address this, substantial stimulus funding has been earmarked for the National Healthcare Information Network and for Medicare and Medicaid incentives for meaningful usage of certified, interoperable EHRs by hospitals and physicians offices.
Dr. Glaser further emphasized that the “meaningful usage” of EHRs has the stated objective of better quality outcomes at a lower cost. A key enabler to scale adoption is workforce development – an estimated 50,000 HIT knowledge workers are needed to meet demand. Interoperability standards establishment and adoption by healthcare IT vendors and the providers is essential and should take place over the foreseeable future. [Click for Dr. Glaser's Presentation]
Panelists noted significant IT challenges that impact personalized medicine:
1. The national healthcare IT infrastructure is not yet ready to support the molecular diagnostics data existing today and that will certainly increase. Reducing the costs of the testing, sequencing, storing, archiving, accessing (by clinicians), analyzing and reporting the data, and the concomitant clinical decision support, requires a more sophisticated and robust IT infrastructure than is currently available.
2. There must be enhanced capability to capture clinical outcomes data and to develop usage of the clinical data in meaningful ways.
3. There is an imperative to strike a balance between security, privacy and access. Technological lock-ins into proprietary systems is a significant challenge.
4. Cataloging companion diagnostic tests (with necessary details and insights) and making this available online in an intuitive manner is key to mainstream adoption of personalized medicine by payers, providers, physicians and patients. Providing access to physicians and training them on this catalog will be critical to educating them.
C. Business Models and Implications
Are pharma and diagnostics companies aligned? Is a new regulatory framework needed? What business models have the best chance of effecting personalized medicine?
An innovative aspect of this year’s conference was an audience participation exercise, orchestrated by Richard Hamermesh, DBA, professor of management practice, Harvard Business School, and Mara Aspinall, president and CEO, On-Q-ity, Inc. Two Harvard Business School-style case studies, specially prepared for the conference, were presented.
One discussed the considerations for labeling and marketing the colorectal cancer drugs Erbitux and Vectibix based on testing patients’ tumors for their KRAS gene. The other dealt with the opportunities and challenges presented by the explosion of genetic testing. The audience responded with rich, highly interactive and engaging discussion with often diverse perspectives articulated.
Discussion of the case regarding Erbitux and Vectibix focused attention on the economic (and philosophical) considerations for when pharma companies might or should include an expectation of genetic testing in their seeking approval from the FDA, or the European Medicines Agency (EMEA), for how the drugs should be administered. Erbitux and Vectibix were approved in the United States and Vectibix was approved by EMEA only for patients whose tumors do not have a mutation in the KRAS gene. Based upon this approval and other scientific evidence the FDA changed the label for both drugs and indicated that only patients who do not have mutations in the the KRAS gene are likely to benefit from these drugs.
Among the questions that stimulated very active conversation were: How did the economics of how Erbitux was approved for use play into subsequent purchase of ImClone by Eli Lilly? Did the pharma companies know about the genetic basis for differential response rates? What are the implications for other “smart” drugs under development, based on how these two drugs were handled?
The discussion of the second case highlighted the changing landscape for gaining widespread acceptance of genetic testing for its implications in disease diagnosis, prediction of occurrence, and drug choices and dosage. The growth rate of available tests is impressive, and the understanding of their usage will expand dramatically the portion of the population who can benefit from them.
The audience was challenged to suggest, in the context of Professor Clayton Christensen’s notion of “disruptive innovation,” what changes in current regulations, business models and thinking would be necessary to make the use of genetic testing more widespread and economically feasible. Are small labs, those currently delivering diagnostic tests with a small sales force, a sustainable model? Is there a possibility of scaling to broader distribution channels and getting diagnostics included in catalogs integrated into the doctor’s desktop for easy ordering of the test on demand? What roles might large pharma and biotech companies play?
A common perspective in the discussion of both cases was that genetic testing is critical enabler of personalized medicine and that substantial changes on many fronts are necessary to yield promised and promising results.
Scaling Personalized Medicine beyond the borders of the US: the P/M Experience in Mexico and the United Kingdom (UK)
Dr. Gerardo Jimenez-Sanchez, Director General, National Institute of Genomic Medicine (INMEGEN), Mexico, pointed out that currently most of the personalized medicine research and development is concentrated in the US, home to only 4.52% of the world’s population. This, he suggested, is not sustainable economically and politically. He articulated the need to create a more international market for personalized medicine, to address the complex and demanding issues in a global healthcare context. [Click for Dr. Jimenez-Sanchez's presentation]
To that end, Dr. Sanchez shared his experience with orchestrating personalized medicine in Mexico, which has the 11th largest population in the world and the largest of all Spanish speaking countries. With a very diverse population comprising 65 indigenous groups, Mexico identified personalized medicine as an opportunity to improve healthcare, advance research and development, and a move toward a knowledge-based economy. The Mexican Congress has created a National Institute of Health (NIH) for Genomic Medicine in 2004, with an initial regulatory framework. An ambitious Mexican Genome Diversity Project, a Human Bio-banks and Genomic Research Project, and several personalized medicine focused research projects at INMEGEN have been launched with the stated objective of making “individualized medicine” a reality by 2015.
Sir Michael Rawlins, Chairman, National Institute for Health and Clinical Excellence, UK, provided an overview on the state of personalized medicine innovation and adoption in the United Kingdom. The key objective was to secure and deliver the highest quality of healthcare UK can afford. Personalized medicine is an additional avenue for doing that.
Dr. Rawlins noted that the UK is challenged by expectations for significantly higher standards for genetic testing as well as higher levels of quality control which present significant but potentially avoidable economic costs. Another challenge he cited is that there are now 25 million individual health records in the UK, complete with their personal details. While health data embedded in electronic medical records should be accessible on demand, they also raise privacy and security concerns.
Dr. Rawlins observed that the global system of healthcare is constrained by finite resources. The amount countries such as Mexico, the UK and the U.S. spend on healthcare is closely correlated to each country’s gross domestic product. This will inevitably affect the scale with which personalized medicine is adopted. He concluded that the promise of personalized medicine is immense and its utility has been unequivocally demonstrated, but expects that each country would embark on a calibrated adoption path that is appropriate within its own healthcare context.
Who will be the Biggest Beneficiaries of large scale adoption of P/M?
Given the current momentum and perspectives on accelerating P/M going forward, the concluding panel discussion focused on the beneficiaries of P/M for the foreseeable future.
There was consensus that pinpointing diagnosis for a high cost disease like cancer thru genetic testing is compelling, especially if it has a positive impact on the total cost of treatment. Cancer patients particularly, are well positioned to benefit, as are the oncologists who administer them. The patient benefits from the more precise diagnosis and therapy tailored for them, especially avoiding medicine/drugs that could have toxic effects on them, and /or do not impact treatment outcome, despite the higher costs.
Genetic testing can often serve to complement the lack of a robust family history. It was pointed out that Plavix is a poster child of success with different impact in patients based on their genetic variance. 25-30% of patients (who have had stents installed) with certain genetic make ups show a 3 fold risk of stent thrombosis with Plavix, relative to other patients.
What is the implication of this genetic roadblock for patients with stents taking Plavix? Genotype testing at around $ 600 per test per patient reveals this early on and qualifies patients at risk of stent thrombosis. This presents significant potential to draft a tailored treatment life-cycle (statins, stents, bypass surgery etc.) for each patient subject to his/her genetic profile and lowering risks of adverse events.
The huge levels of non-compliance especially in chronic disease management, provides a basis for leveraging genetic testing and diagnosis to change and modify patient behavior.Genetic testing and information thereof, is a way to drive compliance in patients, and potentially change patient behavior. At this time there is a huge societal and patient interest in genetic testing as predictor of certain conditions and diseases.
However, education, evidence of success and experience from a patient’s perspective are challenges that need to be addressed. Physicians and genetic counselors are needed to guide and educate the patient to maximize the quality of treatment, and assure the best therapeutic outcomes at the lowest total cost. As well, better education of the clinicians is needed since they see an overload of often contrasting and conflicting information.
Besides the patients and the providers, it is anticipated that some of the obvious beneficiaries of large scale adoption of P/M will be the V/Cs and investors, the diagnostics and pharma companies and the payers, as discussed earlier.
Key Takeaways from the 2010 Personalized Medicine Conference
In conclusion, Dr. Raju Kucherlapati provided these salient points to ponder for contemplation, and to drive the P/M momentum forward: Given the momentum around Healthcare reform, there was significant regulatory pressure to ensure that patients that will respond to drugs and treatment be proactively identified using tools like bio-markers or companion diagnostics, to ensure the highest efficacy of treatment delivered. The $ 1000 genome sequencing price point may actually be around the corner to render this affordable and accessible to almost everyone.
1. Significant early successes provide incontrovertible evidence of the promise of P/M in delivering targeted treatment for each patient based on his/her genetic profile, assuring the best possible therapeutic outcome but much remains to be done.
2. Current payment systems are fundamentally flawed – payments for volumes and not value. The current healthcare reform assuring coverage for every American would be a big step forward and a significant enabler of P/M.
3. Lack of standards and best practices in gathering and storing genetic information into Electronic Health Records (EHRs) is a serious impediment, as is the extremely low adoption of both EMRs and EHRs by hospitals and physicians offices. The incentives provided by the ARRA stimulus to drive “meaningful EHRs usage” is encouraging and a key enabler of providing the information infrastructure needed to drive and sustain P/M from a HIT perspective.
4. It was extremely encouraging that P/M has now transitioned across the borders of the US, as evidenced by success in Mexico and the United Kingdom (UK) – this is key to scaling targeted treatment for people across the world and drive down total costs of healthcare.
5. The Future of Personalized Medicine (P/M) is now and needs to be collaboratively driven by all stakeholders: academia, government, payers, producers, providers and physicians to scale and enable large scale adoption of P/M and deliver value to patients.