Merck Korea and the health authorities have renewed their risk-sharing agreement over Erbitux (ingredient: cetuximab), a treatment for metastatic head, neck, and colorectal cancer.
RSA refers to an agreement between a pharmaceutical company and the National Health Insurance Service (NHIS) to share the responsibility for uncertainties regarding a drug’s efficacy.
According to the NHIS, Erbitux will maintain its RSA status for the next four years. The therapy obtained approval as an orphan drug in 2005 and entered the four-year RSA in March 2014.
Industry officials have been paying attention to whether Merck and the government would prolong the RSA, which ended in March this year. The bilateral negotiations for the RSA renewal were not smooth, however, sources said.
During the talks, Erbitux failed to get insurance benefit. Merck reportedly had to offer some drug price cuts for a successful renegotiation.
“Even though the renewal of the RSA has been completed, we had difficulties in negotiations because it was the first case of an RSA extension,” said Lee Young-hee, head of the drug pricing department at the NHIS.
A prostate cancer treatment Xtandi (ingredient: enzalutamide) and a lung cancer drug Xalkori (component: Crizotinib) are also on the table for an RSA renewal this year.
On the other hand, a multiple myeloma treatment Revlimid (ingredient: lenalidomide hydrate) had its RSA terminated, with generic drugs released in the market on patent expiration.
Evoltra, a leukemia treatment, had its RSA extended for one year because the authorities found it difficult to obtain clinical data for revaluation due to a small number of patients.