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Rashid Sayyid: Hello, everyone, this is Rashid Sayyid. I'm a urologic oncology fellow at the University of Toronto, and, along with Zach Klaassen, Associate Professor of the Department of Urology, we'll be discussing a recent publication from JCO looking at projected savings for generic oncology drugs purchased via Mark Cuban's Cost Plus Drug Company versus in Medicare. This study was recently published by Brian Cortese from Vanderbilt with Dr. Ruchika Talwar as one of the principal investigators.

So prescription drug spending accounts for about 27% of the total fee-for-service spending among beneficiaries enrolled in Medicare Parts A, B, and D. And so oncology drugs specifically, among all these prescriptions within the prescription drug benefit Part D, represents less than 1%, so 0.6% of sales volume, but disproportionately accounts for 13.2% of Medicare Part D spending in 2020. And so despite generic entry, many generic oncology drug prices have remained high in many cases.

And why does this matter? We know that patients experiencing financial toxicity are much more likely to skip doses, and thus less likely fill prescriptions and have worse outcomes and lower efficacy of the drugs. They take on significant debt. They experience significant anxiety and depression with a decreased quality of life and, as such, overall, will have worse outcomes with increased mortality.

So in January 2022, Mark Cuban and Alexander Oshmyansky established the Mark Cuban Cost Plus Drug Company, or the MCCPDC. And this company provides direct-to-consumer generic prescription drugs, with drugs priced as follows. So it's the whatever manufacturing cost for that specific drug, and then they upcharge you with a 15% pricing strategy, and then they charge you a $3 pharmacy fee, and then a $5 shipping cost, depending on whether you use a 30/60/90-day prescription, doesn't matter, it's a flat fee of $5. And currently this company offers seven generic oral oncology drugs. So the one that's specific to prostate cancer is abiraterone, and then we have anastrozole, imatinib, letrozole, methotrexate, raloxifene, and tamoxifen as well.

So the study objective was to estimate what are the potential savings to Medicare and its beneficiaries if Part D plans obtained prices for these seven oral oncology drugs under the current MCCPDC, the Mark Cuban pricing plan.

And so, very simple, they obtained public formulary data from this company as of December 2022 for the seven oral oncology drugs. So they looked at the dosage and the prices for each. And so for each drug they calculated the per dosage unit cost, and then they accounted for the 15% markup, and then the $3 pharmacy fee and the $5 shipping fee. And they assumed a 30-day prescription for the purposes of this analysis, which is quite conservative because, if you consider 90 days, you only pay $5, for every 30 days, you would pay five plus five plus five, so $15 total. So they're trying to be conservative in this setting.

Next, they used the Center for Medicare and Medicaid Services, or the CMS for short, 2020 Medicare Part D Spending by the Drug dashboard to identify the total dosage units that were dispensed for both the brand name, generic versions of each drug. And the reason they used 2020 was that that was the last available data at the time of the analysis. And then next, they used the 2022 third quartile formulary to extract the 25th, median, and 75th percentile unit prices for each generic drug. So the prices are coming from 2022, but essentially the sales volume in this, the usage comes from 2020. And again, those are when those data were last available.

And first, they calculated the projected Medicare Part D spending. And how did they do that? So they calculated the spending across the seven oncology drugs in total and then separately for each drug. And the way they did this is quite simple. So they used the 2022 third quarter quartile Medicare Part D plan reported unit price, so it gives you the price, and then the sales volume for all brand and generic units dispensed in 2020. And so by multiplying those two, you can get a sense of the spending. And then they calculated estimated spending as such by multiplying those two. And then they computed the cost savings by considering the 25th, median, and 75th percentile of Medicare Part D formulary prices per dosage units compared to the Mark Cuban drug plan generic price per dosage unit.

Next, they look at it from the individual spending aspect. So if the beneficiary used the Mark Cuban prices as opposed to the typical Part D plan prices, how did that save costs for the patient? And the way they did that is they calculated the difference between prices offered by this company and a typical Part D plan on the basis of a particular drug daily regimen, and this was extrapolated to a month and a year.

Next, they looked at the potential number of beneficiaries who could be affected. And the way they did that, on an annual basis, was done by dividing the total number of 2020 dosage units dispensed by the number of dosage units that were needed per day for a common oncologic condition and the number of days in a year. So based on that, you can get a sense of the number of patients per year who could benefit from this plan.

At this point, I'll turn it over to Zach to go over the results and discussion for the study.

Zach Klaassen: Thanks so much, Rashid. So if we look at the potential savings, if the median Medicare Part D unit prices were replaced by the Mark Cuban prices, this would save $661.8 million. And this has a range of savings. It could be as low as $228.1 million at the 25th percentile, all the way up to $2,154.5 million if at the 75 percentile.

This table looks at the median cash pay prices for 30-day prescriptions. And this is really what patients may be paying out of pocket, and so this is an important table because it compares what the Medicare Part D versus the Mark Cuban drug plan costs the patients out of pocket for a 30-day prescription. So some significant differences amongst three of these drugs. So abiraterone, which we use in prostate cancer in the clinic all the time, Medicare Part D $562 compared to only $44.60 cents with the Mark Cuban drug plan. We also see dramatic decreases for imatinib 100 mg, $442 on Medicare, $19 on the Mark Cuban drug plan, and imatinib 400 mg, $1,480 on the Medicare Part D program compared to only $44 on the Mark Cuban drug plan. The other drugs, anastrozole, letrozole, methotrexate, raloxifene, and tamoxifen, all have some reduction, but not as drastic as abiraterone and the two doses of imatinib.

So this table looks at the projected impact of the Mark Cuban drug plan on absolute percentage cost savings per individual beneficiary and potential number of beneficiaries affected, specific for abiraterone. So abiraterone monthly prescription savings, $2,071, yearly prescription savings, $25,199, percentage savings of 92.1%, and this impacts over 13,000 patients with prostate cancer.

When we look at this similar table, but looking at the common other oncology indications, we see specifically for imatinib, 100 mg and 400 mg, more than 95% percentage savings for these patients. We also see methotrexate, 33.1% savings, raloxifene, 73.7% savings. And if we add up all the number of impacted beneficiaries, including the abiraterone patients, more than 700,000 patients could be benefited from this drug plan.

Let's talk a little bit about catastrophic coverage phase. The definition of this is that Medicare beneficiaries pay only 5% of the drug prices. So even at the catastrophic coverage phase for Medicare, the Mark Cuban drug plan prices were still lower for abiraterone at the 75th percentile, $81.29 cents, and as well as at imatinib 100 mg median at $22, and at the 75th percentile, $92; and imatinib 400 mg, median $74, and 75th percentile, $295. So even with the consumer paying 5% in the catastrophic coverage phase of Medicare, there's several indications where the Mark Cuban drug plan still had lower prices.

So by way of discussion, the emergence of the Mark Cuban Cost Plus Drug Company has opened avenues for patients needing generic drugs to obtain significant cost savings and to reduce financial toxicity associated with high-price drugs. This analysis suggests that Medicare Part D plan sponsors and their beneficiaries could realize significant cost savings if they obtained pricing such as that offered under the Mark Cuban drug plan. CMS should investigate the extent to which Part D plan sponsors and their pharmacy benefit managers are overpaying for generic prescription drugs and to advocate for receiving more favorable pricing and coverage on generic drugs for its Part D beneficiaries. With the recent passage of the Inflation Reduction Act, the looming $3,250 in 2024 and $2,000 in 2025 out-of-pocket caps for all drugs purchased via the Part D plan, this will limit this analysis' savings estimate in future years. But certainly, in 2023, this has tremendous impact based on the analysis we've discussed.

So in conclusion, in this analysis, total replacement of the current Medicare Part D median formulary prices with cost-plus pricing could yield potential savings of $661.8 million for seven oncology drugs that were looked at in this study. Depending on the drug, individual beneficiaries who purchased at the 50th percentile Part D plans could save nearly $25,200 per year for abiraterone or between $17,500 and $20,500 for imatinib.

Cash-pay prices for Medicare Part D beneficiaries under the catastrophic phase of coverage were still more expensive than the Mark Cuban drug plan prices under specific circumstances for abiraterone and imatinib. Medicare and its Part D sponsors should be encouraged to negotiate for the best market pricing for generic oncology drugs. And in the meantime, providers and patients should explore the possibility of finding lower cash-pay generic drug pricing through resources such as the Mark Cuban Cost Plus Drug plan.

We thank you very much for your attention. We hope you enjoyed this UroToday Journal Club discussion of this recently published article in the Journal of Clinical Oncology.