Drug-Diagnostic Development Stymied by Payer Concerns

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The shift to personalized medicine, which supports medical treatment tailored to individual patient characteristics, has been hindered by uncertainty over the value, accuracy, and clinical utility of companion diagnostic tests.

The shift to personalized medicine, which supports medical treatment tailored to individual patient characteristics, has been hindered by uncertainty over the value, accuracy, and clinical utility of companion diagnostic tests. Even for the handful of drugs approved by FDA with labeling that links prescribing to specific biomarker measures, health plan operators, providers, and payers

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A main reason for slow drug-diagnostic co-development is uncertainty about the FDA regulatory process for bringing such combination products to market. Different rules and procedures govern drugs and medical devices (which includes in vitro diagnostics), and limited FDA authority over laboratory developed tests (LDTs) further muddies the picture. Ideally, manufacturers and regulators would like to bring a personalized medicine and its companion diagnostic to market simultaneously, but this has proved to be challenging. There’s even debate about whether to use the term “personalized” or “precision” to describe new drugs with biomarkers that can identify patients most likely to respond to treatment or to suffer adverse reactions.

Furthermore, FDA approval of a companion diagnostic does not ensure coverage or sufficient

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FDA is in the process of updating guidance for approval of companion diagnostics and continues to work on a long-anticipated advisory on drug-diagnostic co-development, noted Pamela Bradley, a member of the Personalized Medicine Staff in FDA’s

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Center for Devices and Radiological Health (CDRH). FDA is trying to improve the review of drug-diagnostic combinations through regular inter-center consultations, particularly on product labeling. The regulatory process for approving new in vitro diagnostics, Bradley explained, relate to risk of harm to patients from inaccurate test results, as

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opposed to the broader focus for new drugs on product safety, efficacy, and quality. Most companion diagnostics will require prior review by CDRH, and Bradley’s office aims to keep that in line with the drug approval timeline.

Ultimately, the one-drug/one-diagnostic development model is not sustainable, Bradley observed, and disease-based platforms able to assess panels of drugs with common diagnostics may be more efficient. More cost-effectiveness research documenting how companion diagnostics can improve health outcomes also can “close the evidence gap,” said Cohen. These and other strategies are key to supporting coverage decisions that will boost the shift to more precise use of personalized medicines.