1. These slides were released by the speaker for internal use by Novartis

2. Health economics of aromatase inhibitor use Jon Karnon (School of Health and Related Research, University of Sheffield, UK)

3. Outline The purpose of economic analyses Costs and consequences of early breast cancer Assessing health effects of early breast cancer The rationale for decision modelling Applied evaluations of adjuvant therapies for early breast cancer

4. The economic perspective There are finite resources Choices can’t be avoided – decisions must therefore be made Health economics is concerned with making the most of society’s resources devoted to healthcare

5. How do we assess cost effectiveness? Economic evaluation is the comparative analysis of alternative courses of action in terms of their costs and consequences

6. Incremental analysis Is the increased effectiveness of a new treatment worth the extra cost? Treatment A: costs £5000, survival 10 years Treatment B: costs £20000, survival 12 years Incremental cost per life year gained = £15,000/2 = £7500

7. What are the costs & consequences of early breast cancer?

8. Early breast cancer is associated with increased mortality

9. Breast cancer events have high monetary costs (UK 5-year costs) Karnon J. Personal communication

10. Breast cancer events have high monetary costs (US annual costs 1 ) 1 Lamerato et al. J Clin Oncol 2005;23:37s(abstract 634)

11. Treatment-related adverse events have high costs (US annual costs) 1 Locker et al. SABCS 2004; 2 Hidlebaugh Am J Manag Care 2001;7:SP31–SP37; 3 Eltin et al. Arch Intern Med 2004;164:1653–61. 4 AHCRQ. The HCUP-3 National Inpatient Sample (NIS) 2002; 5 CMS. Prospective Payment System (PPS) - Payment Impact File, 2004; 6 St. Anthony’s Complete RBRVS. 2004; 7 Russell et al. Am J Cardiol 1998;81:1110–5. 8 Yu et al. Am J Manag Care 2004;10:909–16; 9 Zhou et al. Cancer 2004;100:507–17; 10 DrugTopics Redbook 2005 1,2 34-899 9

12. Describing quality of life effects QALYs incorporate quantity and quality of life – 1 QALY is equivalent to 1 year in perfect health Utility weights are attached to time in different health states – 0 equivalent to death, 1 equivalent to perfect health Weights summed across health states – (2 x 0.8) + (9 x 0.6) = 11 life years and 7 QALYs

13. QALYs In cost utility analysis benefits measured in terms of QALYs QALYs provide a common currency to assess the extent of the benefits gained from interventions – Comparisons across interventions can be made in terms of cost utility ratios (or cost per QALY)

14. Estimating utility effects Patient direct valuation of own health state General population or patient direct valuation of health states General population indices, e.g. EQ-5D or HUI In EQ-5D responses to 5 dimension questions at specific time points e.g. during RCT are converted to utilities using predetermined general population values

15. Breast cancer events impact on quality of life (utility weights 1 ) 1 Sorensen et al. Value in Health 2005;7:637–57 (abstract)

16. Adverse event impact on quality of life (utility weights) 1 Sorensen et al. Value in Health 2005:7:637–57 (abstract); 2 Utility value for MI not reported; assumed same as that for VTE; 3 Long-term effects of hip fracture estimated assuming 50% experience long-term disability due to fracture based on Leibson et al. J Am Geriatr Soc 2002;50:1644–50; 4 Utility value for non-hip fracture not reported; acute disutility assumed to be ½ that of hip fracture

17. Economic evaluation Perspective: health care system ‘direct healthcare costs’ or wider societal ‘personal costs and indirect (productivity) costs’ Time horizon: within trial or lifetime extrapolation Reimbursement authorities e.g. NICE reference case specifies healthcare perspective and a patient lifetime horizon

18. Trial-based economic evaluations RCTs typically focus on efficacy and safety in narrowly defined population under controlled conditions over limited follow-up – Collection of costs, utility values may be infeasible – Outcomes and costs in RCT setting may not be representative of typical clinical practice – Extended follow-up required to capture relevant outcomes (e.g., mortality) may be impractical or unethical

19. Modelling the lifetime costs and effects of treatment CEAs use models to combine information from RCTs and other sources to project outcomes and costs beyond a trial setting and follow-up Markov models are useful for calculating expected outcomes and costs over extended periods of time Facilitates the synthesis of data from disparate sources Enables the comprehensive analysis of the uncertainty of the estimated costs and benefits BUT is dependent on data and assumptions

20. A Markov model RecurrenceDFSDeath RecurrenceDFSDeath RecurrenceDFSDeath Age 60 Age 61 Age 62

21. What is a Markov model? Mutually exclusive set of health states, e.g. alive, dead Transitions between states occur within regular intervals e.g. annually Values assigned to each state to reflect cost and utility of spending 1 cycle in the state Expected values calculated by multiplying proportion of patients in each state by corresponding cost and utility values and summing across states and cycles

22. The early adjuvant breast cancer cost-effectiveness model (2006) Disease-free No AEs Contralateral tumour Locoregional recurrence Distant metastases Disease-free with AE (combinations of EC, VTE, MI, HF, UA, Hip FX, other FX, arthralgia) *Patients may transition from any state to dead (not shown) Karnon et al.ECCO 2005

23. Populating the UK EABC C-E model Breast cancer event rates (tamoxifen): EBCTCG meta-analysis Adverse event rates (population incidence *tamoxifen hazard ratios) AI hazard ratios (BIG 1-98, ATAC) Effects of breast cancer and adverse events (P025 trial and literature) Costs (Edinburgh/literature) Utility weights (literature)

24. Results (UK) * : 5 years’ letrozole, anastrozole or tamoxifen TamoxifenLetrozole∆†∆† Anastrozole∆†∆† Drug cost£115£4645£4530£3819£3705 AE costs£1635£1797£161£1698£63 Other costs£9510£8287-£1224£8387-£1,123 Total costs£11,260£14,728£3468£13,905£2645 DFS11.4611.970.5011.900.44 Life years12.9413.230.2813.150.20 QALYs12.6312.820.1812.740.10 * All costs and consequences discounted at 3.5% † Difference between the AI and tamoxifen Karnon J. Personal communication

25. Results (UK): letrozole vs tamoxifen, anastrozole vs tamoxifen ICERs (95% CI) Letrozole- tamoxifen Anastrozole- tamoxifen Cost per life year £12,172 (£6835–£35,386) £12,954 (£5359–£65,528) Cost per QALY £12,022 (£6651–£36,061) £12,542 (£5103–£65,346) Karnon J. Personal communication

26. The EABC C-E model results (UK) with 5-year AI carry over effectiveness ICERs (95% CI) Letrozole- tamoxifen Anastrozole- tamoxifen Cost per life year £7218 (£3575–£23,697) £7500 (£1563–£45,063) Cost per QALY £7048 (£3447–£23,599) £7225 (£1432–£44,589) Karnon J. Personal communication

27. Cost-effectiveness acceptability curve: 5 years’ letrozole vs 5 years’ tamoxifen

28. Other cost effectiveness analyses of anastrozole vs tamoxifen AuthorCountryICER* HillnerUS$75,900 LockerUS$23,740 Mansel/BrownUK£11,506 VermaCanadaCan$31,000 AnnemansFrance€12,722 * Incremental cost-effectiveness ratio (all QALYs)

29. Methods comparison All use similar Markov model structure Hillner Cancer 2004 – shorter time horizon (20 years) – patients on an AI have lifelong increased risk of hip fracture – contralateral and locoregional events have only minor utility effects and do not increase rate of metastases – BUT anastrozole benefits maintained beyond 5 years in patients who complete 5 years’ therapy

30. Conclusions AIs more expensive than tamoxifen for early breast cancer but are predicted to increase survival and quality of life Cost-effectiveness results show benefits of 5 years’ letrozole or anastrozole vs 5 years’ tamoxifen are worth the additional costs 5 years’ extended adjuvant letrozole also cost-effective Cost effectiveness of switching strategy not considered How to reconcile with budget constraints?