Economic evaluation of orphan drug Lutetium-Octreotate vs. Octreotide long-acting release for patients with an advanced midgut neuroendocrine tumour in the Netherlands

Objectives: Multiple studies showed positive effects of Lutetium-Octreotate (LO) treatment in neuroendocrine tumours. LO has been used in the Netherlands since the 1980s and recently received the orphan status shortly after the acquisition by Novartis. Since then, the official list price has increased sixfold. From a value-based pricing perspective, we analysed the impact of the increase in price on the incremental cost-effectiveness ratio (ICER) of LO treatment compared to optimal best supportive care, a high dose of Octreotide long-acting release (O-LAR), using the clinical data of the NETTER-1 trial. Methods: A Markov model was developed to evaluate the costs per quality-adjusted life-year (QALY) for LO treatment compared to O-LAR from the healthcare perspective. A scenario analysis was conducted to compare the cost-effectiveness with the initial and increased price level of the LO-treatment. Results: At the increased price level, the cost-effectiveness analysis rendered a deterministic ICER of €53,500 per QALY, while at the initial pricing, the ICER was €19,000 per QALY. The probabilistic sensitivity analysis (PSA) showed that LO had a high probability of being cost-effective at both the increased and initial price level, considering a cost-effectiveness threshold of €80,000. Conclusions: Even at the increased price level, LO treatment can still be considered cost-effective using the applicable Dutch willingness-to-pay threshold of 80,000 euro per QALY. Considering the public scrutiny in relation to this price increase, these outcomes raise the question whether traditional cost-effectiveness methods are sufficient in fully capturing the societal acceptance of prices of new medicines.