Evaluation of erlotinib in advanced non-small cell lung cancer: Impact on the budget of a US health insurance plan

BACKGROUND: Lung cancer is the most common non-skin cancer and the leading cause of cancer death among men and women in North America. More than half of all patients diagnosed with-lung cancer are diagnosed with advanced disease. Most cases of lung cancer are non-small cell lung cancer (NSCLC). Erlotinib monotherapy is indicated for the treatment of patients with locally advanced or metastatic NSCLC after failure of at least 1 prior chemotherapy regimen. OBJECTIVE: To assess the budgetary impact, from the health plan perspective, of covering erlotinib for treating patients with NSCLC stage IIIb/IV who have failed at least 1 prior chemotherapy regimen. METHODS: An Excel-based model was developed to evaluate costs for U.S. Food and Drug Administration-approved and National Comprehensive Cancer Network guideline-recommended treatment options for second-. and third-line NSCLC from the perspective of a U.S. health insurer. In particular, the model compares a formulary with erlotinib and a formulary without erlotinib, including the costs of treatment, drug administration, and adverse effects. The incidence of advanced NSCLC is based on the Surveillance, Epidemiology, and End Results Cancer Registry and adverse effects related to treatment (all agents) in published results of clinical trials. Drug and treatment costs were obtained from publicly available sources in 2005. RESULTS: The base case considers a health plan of 500,000 enrollees. Assuming that erlotinib comprises 30% of second-line treatments and 90% for third-line, total costs of treating stage IIIb/IV NSCLC patients over 1 year are $382,418 with erlotinib and $380,968 without erlotinib (difference: $1,450; 90% confidence interval, -$61,376 to $29,855), less than $0.01 per member per month (PMPM) in 2005. Erlotinib direct cost is offset by reductions in standard chemotherapy-related infusion costs and adverse events. CONCLUSIONS: Based on the analysis, the inclusion of erlotinib on a formulary appears to have a relatively small impact on the annual health care budget or PMPM expenditures if it is used consistent with the product label indications.