WASHINGTON -- The Centers for Medicare and Medicaid Services (CMS) should establish a national payment policy for bevacizumab (Avastin) to treat wet age-related macular degeneration (AMD), a government report concluded.
Although bevacizumab, a cancer drug, is not approved to treat wet AMD, ophthalmologists nonetheless use it off-label to treat the condition, which is a leading cause of vision loss in people ages 60 and older.
A head-to-head study of bevacizumab and ranibizumab (Lucentis) -- which is FDA-approved for wet AMD -- confirmed that the two drugs differ little in preserving visual acuity.
Both drugs -- which are injected in a doctor's office -- are manufactured by Genentech, but ranibizumab injections cost over $1,900 each while bevacizumab costs only $26 per shot, according to a study issued Monday by the Department of Health and Human Services Office of the Inspector General (OIG).
OIG used Medicare claims data to identify 160 doctors who received Medicare payments for prescribing ranibizumab for wet AMD and 160 physicians who prescribed bevacizumab.
Both drugs are covered under Medicare Part B, but there is no set national payment for bevacizumab. Rather, Medicare contractors determine the price on a region-by-region basis.
The OIG investigators asked the 320 physicians how much they spent on the medications. On average, doctors paid $1,928 per vial of ranibizumab in the first quarter of 2010, and were reimbursed by Medicare for $2,023 per dose.
By contrast, physicians paid an average of $26 per dose of bevacizumab, which included the costs of having larger doses of the cancer drug broken down into smaller doses for wet AMD, and the average Medicare reimbursement for bevacizumab in 2010 was $55 per dose.
Medicare beneficiaries pay approximately $400 in coinsurance for each dose of ranibizumab compared with approximately $11 in coinsurance for each dose of bevacizumab, the OIG investigators said.
They also asked physicians who chose bevacizumab why they picked it over ranibizumab. Most physicians (70%) said it was because of cost, 45% said efficacy/effectiveness was a reason, and 40% said patient insurance coverage played a role in their decision.
One physician made the following comment: "I believe that Avastin works as well if not better than Lucentis. Why would I not want to save expenses for my patients, our society, and government by using a product I believe is as effective as the incredibly more expensive alternative? My personal income would have been higher if I had used Lucentis, but I do not believe that is the right thing to do."
In 2010, for the treatment of wet AMD, Medicare spent $1.1 billion for ranibizumab and $27 million for bevacizumab.
An earlier OIG report found that if Medicare reimbursement for all beneficiaries treated for wet AMD had been paid at the Avastin rate, Medicare and its beneficiaries would have saved some $1.4 billion.
The OIG investigators said that in light of the high costs of ranibizumab and the comparability of efficacy between ranibizumab and bevacizumab, CMS should establish a new payment code for treating wet AMD with bevacizumab.
In addition, the report calls for educating physicians that bevacizumab can be purchased for about 1% of the cost of ranibizumab.
CMS did not agree with OIG that it should establish a national payment code for bevacizumab when used to treat wet AMD, pointing to an earlier failed attempt at setting a payment policy.
In 2009, CMS proposed paying $7 for each dose of bevacizumab for wet AMD. That proposal was rescinded, however, after members of Congress wrote a letter to CMS expressing the concern of doctors that the low payment wouldn't cover the cost of the drug.