Efficacy. Table 1. Overall Objective Response. Day 1 Day 2 Day 3 Day 4...Days (vincristine infusion) (doxorubicin infusion)

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1 COST EFFECTIVENESS OF VS IN NEWLY DIAGNOSED MULTIPLE MYELOMA Mohamad A. Hussein, MD, 1 Mark Wildgust, PhD, 2 John Fastenau, MPH, RPh, 3 Catherine Tak Piech, MBA, 3 and the C Study Group 1 The Cleveland Clinic Multiple Myeloma Center, Cleveland, OH; 2 Tibotec Therapeutics, a division of Ortho Biotech Products, L.P., Bridgewater, NJ; 3 Ortho Biotech Clinical Affairs, L.L.C., Bridgewater, NJ ABSTRACT Background: Pegylated liposomal doxorubicin (DOXIL /CAELYX ) was used in place of doxorubicin in the regimen () to treat multiple myeloma. This study evaluates the cost effectiveness (CE) of these 2 regimens. Methods: This economic model evaluates the expected treatment cost and CE of (pegylated liposomal doxorubicin 40 mg/m 2 IV Day 1, vincristine 1.4 mg/m 2 [max 2.0 mg/m 2 ] IV Day 1, and reduced-dose dexamethasone 40 mg PO Days 1-4) vs (vincristine 0.4 mg/day and conventional doxorubicin 9 mg/day by continuous IV infusion Days 1-4 and reduced-dose dexamethasone 40 mg PO Days 1-4) in patients with newly diagnosed multiple myeloma. A payer s perspective is adopted. Clinical results and resource use are drawn from a randomized, multicenter comparative trial; this model examines only those direct costs associated with study drug and administration. Resources are valued via the following: 2004 Drug Topics Red Book (drug acquisition); 2001 HCUPnet (inpatient administration fees); and 2003 National Medicare Fee Schedule (outpatient administration fees). CE is calculated as expected cost per objective response (CR/R/PR, SWOG). Results: Final data from 192 patients (, n = 97;, n = 95) are included. Baseline characteristics are balanced across groups. The percentage of patients reporting adverse events is similar, although frequency of grade 3/4 neutropenia is significantly lower for vs (10.3% [95% CI ] vs 24.2% [ ], P =.01), but significantly higher for hand-foot syndrome (25% vs 1%, P <.001; only 4% grade 3). Patients in each group received a similar number of chemotherapy cycles ( 3.4 vs 3.1, P =.53); however, patients receiving required significantly fewer cumulative days in the hospital or outpatient setting for drug administration (4.4 vs 16.1 days, respectively; P <.0001). 3.6% of cycles vs 31.7% of cycles were administered in the hospital (P <.0001). Expected drug costs alone per cycle are higher for compared to ($3, vs $155.49). But, after accounting for inpatient and outpatient administration costs, expected treatment costs per cycle are 38% lower with compared to ($4, vs $6,796.68), and total expected costs for all cycles per patient are 32% lower with vs ($14,388 vs $21,069). In this study, had an objective response rate of 44.3% compared to 41.0% for. Progression-free survival and overall survival are comparable among the 2 groups at 1- and 2-year follow-up. The CE ratio for is superior to ($32, vs $51,389.56) due to the lower expected treatment cost. Conclusions: and have a similar efficacy. Based on this economic model examining drug and administration costs, overall appears to be less costly than from the payer perspective for the treatment of newly diagnosed patients with multiple myeloma. BACKGROUND The combination of vincristine and conventional doxorubicin (both administered as a continuous 96-hour infusion via a central line) with oral dexamethasone () is widely used as first-line therapy for multiple myeloma () 1 Disadvantages of the regimen include the requirement for a central line, inconvenience of a 96-hour continuous infusion of conventional doxorubicin and vincristine, and toxicities such as neutropenia, alopecia, and cardiac dysfunction Pegylated liposomal doxorubicin (DOXIL,Tibotec Therapeutics, a division of Ortho Biotech Products, L.P., Bridgewater, NJ; also known as CAELYX outside the United States, marketed by Schering-Plough Corporation, Kenilworth, NJ) has been used as a replacement for conventional doxorubicin in the regimen, changing to Phase II results with reported a response rate of 88% (12% complete response, 76% partial response), a median time to progression of 23.1 months, and a 3-year survival of 67% in patients with previously untreated 2 Data from the clinical practice setting are lacking regarding the cost effectiveness (CE) of compared to for the treatment of newly diagnosed OBJECTIVE To evaluate the CE of the regimen compared to the regimen with respect to drug cost and administration cost in patients with newly diagnosed Definitions METHODS Cost effectiveness (CE) was defined as the ratio of the expected treatment cost per patient to the overall response rate (ORR) to therapy, assessed using a modified SWOG criteria as either complete remission, remission, or partial remission (CE = expected treatment cost per patient/orr) Data Efficacy and drug utilization data were drawn from a multicenter, randomized, open-label comparative trial of compared with in patients with newly diagnosed 3 Treatment cycles were repeated every 4 weeks until bone marrow or hematopoietic stem cell transplantation, disease progression, stable plateau disease, or unacceptable toxicity Figure 1. Study treatments. Analysis This economic analysis was performed using a payer s perspective (insurer s perspective) Efficacy Objective response rate using modified SWOG criteria Cost D: DOXIL 40 mg/m 2 V: vincristine 1.4 mg/m 2 A: conventional doxorubicin 9 mg/d (96-h infusion) V: vincristine 1.4 mg/d (96-h infusion) Expected drug cost per patient was calculated based on: Drug utilization data from vs trial Drug cost, which was calculated as cost/mg multiplied by the total dose (mg) of drug administered for each group using average wholesale price (AWP, 2004 Red Book, lowest price generic if available) 4 Expected treatment costs for each treatment group were determined from the percentage of cycles administered in the hospital or outpatient clinic setting and the projected costs associated with drug administration in these respective settings Hospitalizations based on the following: D V d d d d d d d d (vincristine infusion) (doxorubicin infusion) Cost of hospitalization was estimated using NIS sample, 2001 National Statistics, V58.1 Chemotherapy encounter (LOS = 4.7 days, charges = $19,324) Cost of outpatient care was estimated using CPT code 96780, 96410, infusion over 1 hour, Medicare national average ($101.89), and an additional $65.84 per infusion hour An infusion time of 2 hours was used for both treatment groups RESULTS Baseline demographic characteristics were balanced across groups and are reported in detail elsewhere 3 Efficacy Table 1. Overall Objective Response Response (n = 97) (n = 95) Overall response* 43 (44.3%) 39 (41.1%) Complete remission 3 (3.1%) 0 (0) Remission 15 (15.5%) 15 (15.8%) Partial remission 25 (25.8%) 24 (25.3%) Stable disease 38 (39.2%) 46 (48.4%) Progression 2 (2.1%) 0 (0) Not evaluable 14 (14.4%) 10 (10.5%) * P =.66, two-sided Fisher s exact test. Patients were not evaluable for efficacy, as neither quantifiable immunoglobulin nor urine M-component were available/recorded. Progression-free survival (PFS) was similar between treatment groups (log-rank P =.83), with a 1- and 2-year PFS of 70.1% and 39.9%, respectively, for the group compared to 66.8% and 33.6% for the group Overall survival was similar in patients treated with compared to (log-rank P =.71), with 1- and 2-year survival rates of 88.9% and 85.2%, respectively, in the group versus 84.5% and 79.9% for the group Safety Mean absolute change in left ventricular ejection fraction (LVEF) from baseline was 2.3 for the group compared to 4.5 for the group (P <.01) was associated with significantly less grade 3/4 neutropenia compared to (10% vs 24%, P =.01) was associated with significantly less alopecia compared to (20% vs 44%, P <.001) Pronounced hair loss (grade 2) was reported in 4% of patients in the group versus 20% of patients in the group was associated with significantly more hand-foot syndrome (25% vs 1%, P <.001; only 4% grade 3 in severity) Study Drug Administration Parameters Considered in the Economic Model Median number of dosing cycles was similar (, 3.4 vs, 3.1; P =.53) Significantly fewer cycles of required hospitalization for administration (, 3.6% vs, 31.7%; P <.001) Additional Parameters Not Considered in the Economic Model Significantly fewer patients treated with required growth factor support compared to those treated with (46% vs 61%, respectively; P <.03) Significantly fewer days for study drug administration were required for patients treated with compared to 1.3 mean days per cycle for versus 5.2 mean days per cycle for (P <.001) 4.4 cumulative days for versus 16.1 cumulative days for (P <.001) Significantly fewer cycles of required a central line for administration (45% vs 96% for ; P <.0001) Cost and Cost Effectiveness Expected drug costs per cycle were higher for compared to (Table 2) Table 2. Overall Drug Utilization and Cost Total Cost Drug Total cost Regimen mg* ($)/mg cost ($) per cycle ($) DOXIL Vincristine Conventional doxorubicin Vincristine * Patient body surface area was 1.95 m 2 in both groups. Drug acquisition costs based on 2004 Red Book AWP. 4 Expected treatment cost per cycle was 38% lower for ($4,231.92) compared to ($6,796.68; Table 3) Table 3. Expected Treatment Cost Per Cycle Inpatient cost (hospital)/cycle Outpatient cost (clinic)/cycle Inpatient Outpatient Total Cost Regimen $/cycle* cycles Cost ($) $/cycle cycles Cost ($) cost/cycle($) difference 19, , , , % 19, , , * Inpatient administration fees were valued via NIS sample, 2001 National Statistics, V58.1 Chemotherapy encounter (LOS = 4.7 days, charges = $19,324). Values represent decimal of the percentage of cycles for this study that were administered in the hospital or outpatient clinic. Outpatient administration fees were valued via CPT code 96780, 96410, infusion over 1 hour, Medicare national average ($101.89) and additional $65.84 per infusion hour. Total cost/cycle calculated by sum of cost for inpatient and outpatient cycles. Cost difference favoring versus was driven by hospitalization for drug administration (3.6% of cycles versus 31.7% of cycles) Total overall expected costs per patient (cost per cycle multiplied by median number of chemotherapy cycles administered in the study) were lower for compared to (Figure 2) Figure 2. Total overall expected cost* per patient. Total cost per patient ($) 25,000 20,000 15,000 10,000 5,000 0 $14, $21, * Cost: drug utilization cost plus administration cost multiplied by number of cycles. Patients in each group received a similar median number of chemotherapy cycles (, 3.4 vs, 3.1); actual number of study cycles used in this analysis. The percentage savings with compared to was 32% ($14, vs $21,069.72), with a similar number of chemotherapy cycles in both groups The CE ratio (CE = expected treatment cost per patient/orr) is superior for versus = $32, per responder = $51, per responder Sensitivity Analysis The percentage of cycles of requiring hospitalization would have to decrease from 31.7% to 20% to achieve a cost neutral comparison to Limitations This CE analysis was a post-hoc analysis Use of clinical trial data to estimate effectiveness and resource use from routine clinical practice Adverse event-related costs were not evaluated, but one would assume that the current analysis would favor the regimen with better tolerability (ie, ) CONCLUSIONS and demonstrate comparable efficacy in patients with newly diagnosed 3 Clinical advantages with compared to include the ability to administer therapy on an outpatient basis, fewer days required for drug administration, less need for growth factor support, and a favorable adverse event profile In this economic model (payer s perspective), drug costs were higher for compared to, but when taking into consideration drug administration costs, expected treatment costs per cycle were 38% less for ( $4,231 vs $6,796) and overall costs across the study were 32% less for ( $14,388 vs $21,069) References 1. Munshi N, et al. In: DeVita VT Jr, et al. Cancer Principles & Practice of Oncology.6th edition Hussein M, et al. Cancer. 2002;95: Rifkin RM. Presented at the 40th Annual Meeting of the American Society of Clinical Oncology; June 5-8, 2004; New Orleans, LA Drug Topics Red Book. 108th edition ACKNOWLEDGMENTS We gratefully acknowledge the patients and families who made this study possible. Participating investigators: R. Rifkin, S. Gregory, A. Mohrbacher, A. Briggs, H. Burris, C. DeCastro, M. Gautier, J. Gurtler, Y-H. Chen, L. Heffner, J. Wall, K. Stewart, J. Ganey, D. Vafai, J. Hajdenberg, B. Mason, T. Pluard, R. Smith, D. Gravenor, J. Gandhi, J. Kirshner, F. Yunus. This study was supported by Tibotec Therapeutics, a division of Ortho Biotech Products, L.P., Bridgewater, NJ and ALZA Corporation, Mountain View, CA.

2 ABSTRACT Background: Pegylated liposomal doxorubicin (DOXIL /CAELYX ) was used in place of doxorubicin in the regimen () to treat multiple myeloma. This study evaluates the cost effectiveness (CE) of these 2 regimens. Methods: This economic model evaluates the expected treatment cost and CE of (pegylated liposomal doxorubicin 40 mg/m 2 IV Day 1, vincristine 1.4 mg/m 2 [max 2.0 mg/m 2 ] IV Day 1, and reduced-dose dexamethasone 40 mg PO Days 1-4) vs (vincristine 0.4 mg/day and conventional doxorubicin 9 mg/day by continuous IV infusion Days 1-4 and reduced-dose dexamethasone 40 mg PO Days 1-4) in patients with newly diagnosed multiple myeloma. A payer s perspective is adopted. Clinical results and resource use are drawn from a randomized, multicenter comparative trial; this model examines only those direct costs associated with study drug and administration. Resources are valued via the following: 2004 Drug Topics Red Book (drug acquisition); 2001 HCUPnet (inpatient administration fees); and 2003 National Medicare Fee Schedule (outpatient administration fees). CE is calculated as expected cost per objective response (CR/R/PR, SWOG). Results: Final data from 192 patients (, n = 97;, n = 95) are included. Baseline characteristics are balanced across groups. The percentage of patients reporting adverse events is similar, although frequency of grade 3/4 neutropenia is significantly lower for vs (10.3% [95% CI ] vs 24.2% [ ], P =.01), but significantly higher for hand-foot syndrome (25% vs 1%, P <.001; only 4% grade 3). Patients in each group received a similar number of chemotherapy cycles ( 3.4 vs 3.1, P =.53); however, patients receiving required significantly fewer cumulative days in the hospital or outpatient setting for drug administration (4.4 vs 16.1 days, respectively; P <.0001). 3.6% of cycles vs 31.7% of cycles were administered in the hospital (P <.0001). Expected drug costs alone per cycle are higher for compared to ($3, vs $155.49). But, after accounting for inpatient and outpatient administration costs, expected treatment costs per cycle are 38% lower with compared to ($4, vs $6,796.68), and total expected costs for all cycles per patient are 32% lower with vs ($14,388 vs $21,069). In this study, had an objective response rate of 44.3% compared to 41.0% for. Progression-free survival and overall survival are comparable among the 2 groups at 1- and 2-year follow-up. The CE ratio for is superior to ($32, vs $51,389.56) due to the lower expected treatment cost. Conclusions: and have a similar efficacy. Based on this economic model examining drug and administration costs, overall appears to be less costly than from the payer perspective for the treatment of newly diagnosed patients with multiple myeloma.

3 BACKGROUND The combination of vincristine and conventional doxorubicin (both administered as a continuous 96-hour infusion via a central line) with oral dexamethasone () is widely used as first-line therapy for multiple myeloma () 1 Disadvantages of the regimen include the requirement for a central line, inconvenience of a 96-hour continuous infusion of conventional doxorubicin and vincristine, and toxicities such as neutropenia, alopecia, and cardiac dysfunction Pegylated liposomal doxorubicin (DOXIL,Tibotec Therapeutics, a division of Ortho Biotech Products, L.P., Bridgewater, NJ; also known as CAELYX outside the United States, marketed by Schering-Plough Corporation, Kenilworth, NJ) has been used as a replacement for conventional doxorubicin in the regimen, changing to Phase II results with reported a response rate of 88% (12% complete response, 76% partial response), a median time to progression of 23.1 months, and a 3-year survival of 67% in patients with previously untreated 2 Data from the clinical practice setting are lacking regarding the cost effectiveness (CE) of compared to for the treatment of newly diagnosed OBJECTIVE To evaluate the CE of the regimen compared to the regimen with respect to drug cost and administration cost in patients with newly diagnosed Definitions METHODS Cost effectiveness (CE) was defined as the ratio of the expected treatment cost per patient to the overall response rate (ORR) to therapy, assessed using a modified SWOG criteria as either complete remission, remission, or partial remission (CE = expected treatment cost per patient/orr) Data Efficacy and drug utilization data were drawn from a multicenter, randomized, open-label comparative trial of compared with in patients with newly diagnosed 3 Treatment cycles were repeated every 4 weeks until bone marrow or hematopoietic stem cell transplantation, disease progression, stable plateau disease, or unacceptable toxicity

4 Figure 1. Study treatments. D: DOXIL 40 mg/m 2 D V d d d d V: vincristine 1.4 mg/m 2 A: conventional doxorubicin 9 mg/d (96-h infusion) V: vincristine 1.4 mg/d (96-h infusion) d d d d (vincristine infusion) (doxorubicin infusion) Analysis This economic analysis was performed using a payer s perspective (insurer s perspective) Efficacy Objective response rate using modified SWOG criteria Cost Expected drug cost per patient was calculated based on: Drug utilization data from vs trial Drug cost, which was calculated as cost/mg multiplied by the total dose (mg) of drug administered for each group using average wholesale price (AWP, 2004 Red Book, lowest price generic if available) 4 Expected treatment costs for each treatment group were determined from the percentage of cycles administered in the hospital or outpatient clinic setting and the projected costs associated with drug administration in these respective settings Hospitalizations based on the following: Cost of hospitalization was estimated using NIS sample, 2001 National Statistics, V58.1 Chemotherapy encounter (LOS = 4.7 days, charges = $19,324) Cost of outpatient care was estimated using CPT code 96780, 96410, infusion over 1 hour, Medicare national average ($101.89), and an additional $65.84 per infusion hour An infusion time of 2 hours was used for both treatment groups RESULTS Baseline demographic characteristics were balanced across groups and are reported in detail elsewhere 3

5 Efficacy Table 1. Overall Objective Response Response (n = 97) (n = 95) Overall response* 43 (44.3%) 39 (41.1%) Complete remission 3 (3.1%) 0 (0) Remission 15 (15.5%) 15 (15.8%) Partial remission 25 (25.8%) 24 (25.3%) Stable disease 38 (39.2%) 46 (48.4%) Progression 2 (2.1%) 0 (0) Not evaluable 14 (14.4%) 10 (10.5%) * P =.66, two-sided Fisher s exact test. Patients were not evaluable for efficacy, as neither quantifiable immunoglobulin nor urine M-component were available/recorded. Progression-free survival (PFS) was similar between treatment groups (log-rank P =.83), with a 1- and 2-year PFS of 70.1% and 39.9%, respectively, for the group compared to 66.8% and 33.6% for the group Overall survival was similar in patients treated with compared to (log-rank P =.71), with 1- and 2-year survival rates of 88.9% and 85.2%, respectively, in the group versus 84.5% and 79.9% for the group Safety Mean absolute change in left ventricular ejection fraction (LVEF) from baseline was 2.3 for the group compared to 4.5 for the group (P <.01) was associated with significantly less grade 3/4 neutropenia compared to (10% vs 24%, P =.01) was associated with significantly less alopecia compared to (20% vs 44%, P <.001) Pronounced hair loss (grade 2) was reported in 4% of patients in the group versus 20% of patients in the group was associated with significantly more hand-foot syndrome (25% vs 1%, P <.001; only 4% grade 3 in severity) Study Drug Administration Parameters Considered in the Economic Model Median number of dosing cycles was similar (, 3.4 vs, 3.1; P =.53) Significantly fewer cycles of required hospitalization for administration (, 3.6% vs, 31.7%; P <.001) Additional Parameters Not Considered in the Economic Model Significantly fewer patients treated with required growth factor support compared to those treated with (46% vs 61%, respectively; P <.03) Significantly fewer days for study drug administration were required for patients treated with compared to 1.3 mean days per cycle for versus 5.2 mean days per cycle for (P <.001) 4.4 cumulative days for versus 16.1 cumulative days for (P <.001) Significantly fewer cycles of required a central line for administration (45% vs 96% for ; P <.0001)

6 Cost and Cost Effectiveness Expected drug costs per cycle were higher for compared to (Table 2) Table 2. Overall Drug Utilization and Cost Total Cost Drug Total cost Regimen mg* ($)/mg cost ($) per cycle ($) DOXIL Vincristine Conventional doxorubicin Vincristine * Patient body surface area was 1.95 m 2 in both groups. Drug acquisition costs based on 2004 Red Book AWP. 4 Expected treatment cost per cycle was 38% lower for ($4,231.92) compared to ($6,796.68; Table 3) Table 3. Expected Treatment Cost Per Cycle Inpatient cost (hospital)/cycle Outpatient cost (clinic)/cycle Inpatient Outpatient Total Cost Regimen $/cycle* cycles Cost ($) $/cycle cycles Cost ($) cost/cycle($) difference 19, , , , % 19, , , * Inpatient administration fees were valued via NIS sample, 2001 National Statistics, V58.1 Chemotherapy encounter (LOS = 4.7 days, charges = $19,324). Values represent decimal of the percentage of cycles for this study that were administered in the hospital or outpatient clinic. Outpatient administration fees were valued via CPT code 96780, 96410, infusion over 1 hour, Medicare national average ($101.89) and additional $65.84 per infusion hour. Total cost/cycle calculated by sum of cost for inpatient and outpatient cycles. Cost difference favoring versus was driven by hospitalization for drug administration (3.6% of cycles versus 31.7% of cycles) Total overall expected costs per patient (cost per cycle multiplied by median number of chemotherapy cycles administered in the study) were lower for compared to (Figure 2) Figure 2. Total overall expected cost* per patient. Total cost per patient ($) 25,000 20,000 15,000 10,000 5,000 0 $14, $21, * Cost: drug utilization cost plus administration cost multiplied by number of cycles. Patients in each group received a similar median number of chemotherapy cycles (, 3.4 vs, 3.1); actual number of study cycles used in this analysis. The percentage savings with compared to was 32% ($14, vs $21,069.72), with a similar number of chemotherapy cycles in both groups

7 The CE ratio (CE = expected treatment cost per patient/orr) is superior for versus = $32, per responder = $51, per responder Sensitivity Analysis The percentage of cycles of requiring hospitalization would have to decrease from 31.7% to 20% to achieve a cost neutral comparison to Limitations This CE analysis was a post-hoc analysis Use of clinical trial data to estimate effectiveness and resource use from routine clinical practice Adverse event-related costs were not evaluated, but one would assume that the current analysis would favor the regimen with better tolerability (ie, ) CONCLUSIONS and demonstrate comparable efficacy in patients with newly diagnosed 3 Clinical advantages with compared to include the ability to administer therapy on an outpatient basis, fewer days required for drug administration, less need for growth factor support, and a favorable adverse event profile In this economic model (payer s perspective), drug costs were higher for compared to, but when taking into consideration drug administration costs, expected treatment costs per cycle were 38% less for ( $4,231 vs $6,796) and overall costs across the study were 32% less for ( $14,388 vs $21,069) References 1. Munshi N, et al. In: DeVita VT Jr, et al. Cancer Principles & Practice of Oncology.6th edition Hussein M, et al. Cancer. 2002;95: Rifkin RM. Presented at the 40th Annual Meeting of the American Society of Clinical Oncology; June 5-8, 2004; New Orleans, LA Drug Topics Red Book. 108th edition ACKNOWLEDGMENTS We gratefully acknowledge the patients and families who made this study possible. Participating investigators: R. Rifkin, S. Gregory, A. Mohrbacher, A. Briggs, H. Burris, C. DeCastro, M. Gautier, J. Gurtler, Y-H. Chen, L. Heffner, J. Wall, K. Stewart, J. Ganey, D. Vafai, J. Hajdenberg, B. Mason, T. Pluard, R. Smith, D. Gravenor, J. Gandhi, J. Kirshner, F. Yunus. This study was supported by Tibotec Therapeutics, a division of Ortho Biotech Products, L.P., Bridgewater, NJ and ALZA Corporation, Mountain View, CA.

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