The Health Benefits and Economic Value of Pharmacogenomics

What is Pharmacogenomics?

The National Human Genome Research Institute (NHGRI) defines pharmacogenomics (PGx) as a “component of genomic medicine that involves using a patient’s genomic information to tailor the selection of drugs used in their medical management” (1). PGx is a core element of precision medicine and is designed to improve the individual’s response to medication by assessing drug-compatibilities with the person’s genomic profile.

Genetic variation in genes – such as genes encoding for drug-metabolizing enzymes (DME), drug receptors, and drug transporters – can directly impact the pharmacodynamic and pharmacokinetic of drugs (2). For example, the phenotype of genetic polymorphism in DME, which can alter the activity of the enzyme and impact the rate drugs are metabolized (3). Rapid drug metabolism can lead to lower than required drug concentrations, and potentially render treatment ineffective. Separately, poor metabolizer may accumulate higher-than-normal drug concentrations in turn increases the risk of adverse drug events (ADEs). PGx testing can help predict the drug dose to improve drug efficacy and prevent ADEs (Figure 1) (4).

Figure 1. Pharmacogenomics can help tailor treatment and dosage requirements.

Benefits of PGx testing applies to many therapeutic areas, including psychiatry, anesthesiology, neurology, pulmonary, cardiology, infectious diseases, and oncology. PGx is an important part of drug development (5) and approval of drugs with PGx labelling is increasing (6). Not all reported drug-gene interactions (DGIs) are clinically actionable. The Pharmacogenomics Knowledge Base (PharmGKB) divides gene-drug combinations into four categories (PGx levels): “required genetic testing”, “recommended genetic testing”, “actionable PGx”, and “informative PGx” (6). Continuous PGx research increases our understanding of drug-gene, drug-gene-gene, and drug-drug-gene interactions (3).

PGx testing can be performed using molecular technologies such as real-time PCR, microarrays, mass spectroscopy arrays, and next-generation sequencing (NGS) (7). These technologies support targeted (single gene-drug pair) and expanded (>1 gene-drug pair) panel testing (7,8) PGx can be performed reactive or pre-emptive. Reactive testing correlates the genomic profile with medications targeting a current diagnosis, whereas pre-emptive testing determines the patient’s genetic baseline for possible future medications (9-11).

Patient health benefit

Studies have shown that PGx can significantly improve patient health benefits, from more effective health treatment, fewer adverse drug events (ADE), reduction in hospital visits, and mortality.

PGx can provide more effective health treatment

Antidepressants are among the most used drugs among adults aged between 40-59 (12), and some reports estimate that the response rate to initial antidepressant treatment is about 50%, and that genetic variation can be responsible for 15-30% of the difference in drug response observed between patients (13). The clinical utility for PGx and mental health treatment has been investigated in various studies. One study reported that patients with PGx supported treatment for mood and anxiety disorders had 40% fewer emergency room visits, and 58% fewer inpatient hospitalizations (14). A recent systematic review and meta-analysis of randomized controlled trials found that utilizing PGx led to a 1.7 times more likely achievement of symptom remission (15). Another retrospective study found a significant increase in the medication adherence rate for patients with PGx-guided psychiatric medication intervention (16). A randomized controlled trial on the effect of PGx on the outcome of patients diagnosed with neuropsychiatric disorders found that PGx reduced reported ADEs from 53% to 28% (17).

Almost everyone carries actionable genetic variants

A large Danish population-based case-cohort study evaluated the PGx profile of ~77,000 participants regarding clinically relevant variants for the treatment of severe mental disorders and found that almost all individuals (> 99.9%) carried at least one actionable genetic variant (18).

PGx can be applied to all disease areas with known DGI medication. Interestingly, a U.K. study reported that only four pharmacogenes were responsible for >95% of observed DGIs in the primary care setting (19). A large U.K. population study analyzing about half a million participants confirmed that almost everyone carries a genetic variant that may impact the response to drugs (20).

PGx and polypharmacy

PGx can help reduce the side effects and interactions in patients taking multiple drugs. One study reported that PGx reduces rehospitalization by 52%, emergency department visits by 42% and mortality by 85% for polypharmacy home health patients (21). Another study evaluating the impact of PGx on polypharmacy found a reduction of emergency room visits by 71% and 39% less hospitalizations (21)

The benefits of pre-emptive PGx

A large-scale, longitudinal study addressed the real-world impact of preemptive PGx in combination with comprehensive medication management (CMM) for patients enrolled in Medicare advantage (22). The investigation compared the results of over 5,000 PGx-guided patients with the control group, consisting of over 20,000 non-PGx guided patients. The outcome showed a clear benefit for patients with PGx support, demonstrated by a reduction of outpatient, emergency department and inpatient utilization (reduction of 1.9%, 6.8% and 14.9%, respectively).

Health Economic Assessment

Apart from clinical benefits, PGx advantages go beyond the individual patient and offer economic benefits to both payers and providers. Given that the annual cost of nonoptimized medication therapy has been estimated at $528B US dollars (USD) (23), PGx may offer an opportunity to lower costs associated with actionable DGIs.

PGx can provide cost-effective health treatment

Addressing the economic impact of PGx on mental health treatment, one study estimated the saving of reduced emergency and hospitalization utilization to almost $2K USD over a 6-month follow-up (14). The positive impact of PGx-guided psychiatric drug selection on medication adherence related to a cost savings of around $560 USD over a 4-month follow-up period (16). For polypharmacy patients, PGx savings were estimated in the range of $4K USD per patient (21).

PGx and cost-effectiveness

A systematic review of PGx in cardiovascular diseases from 2020 found supportive evidence for costeffectiveness of clopidogrel-CYP2C19 and warfarin-CYP2C9/VKORC1 testing but pointed out that more studies are needed for other DGIs (24). Another systematic review conducted in 2022 focused on PGx drug recommendations covered by the Clinical Pharmacogenetic Implementation Consortium (CPIC) guidelines. The review found that 71% of the 108 analyzed studies reported PGx as cost-effective or costsaving, while other studies either found no cost-effectiveness or were uncertain (20% and 9%, respectively) (25). Both reviews highlighted that only limited information was published on PGx panel and pre-emptive testing.

Cost savings of pre-emptive panel PGx

A recent study addressed the cost benefits of pre-emptive panel PGx. The study utilized a pharmacogenomics-enriched comprehensive medication management system and reported a reduction of $32M USD in direct medical charges over the first 32 months for the ~5,000 PGx-guided patient group (22).

Current Reimbursement Coverage of Pharmacogenomics

The Centers for Medicare & Medicaid Services (CMS) acknowledged the value of PGx in 2009 by implementing a national coverage determination (NCD) for testing related to warfarin (26). As more studies demonstrated health and economic benefits of PGx, and following a large increase in testing, various local coverage determinations (LCDs) were released regarding reimbursement for PGx testing beyond warfarin. Most notably, the Molecular Diagnostic Services (MolDx) program, which is utilized by four of the seven Medicare Administrative Contractors (MACs) and applies to 28 states, expanded the coverage for PGx in 2020 by requiring labs to apply for a z-code and complete a technical assessment. The updated LCD generally covers PGx for clinically actionable DGIs defined by the U.S. Food and Drug Administration (PGx information required for safe drug administration) and guidelines published by the

CPIC (category A and B). Depending on circumstances, reimbursement for single gene, multi-gene and combinatorial testing is supported (27). For details on coverage, please refer to LCD L38294 (28). As recently as January 1, 2023, the American Medical Association (AMA) has added a CPT code defined for PGx panels to normalize billing practices and reimbursement (29).

PGx and the future of modern effective healthcare

Figure 2: Key factors impacting large-scale PGx implementation

A recent article published at the end of 2022 assessed the readiness for large-scale PGx implementation by looking at key factors such as clinical utility, laboratory technology, user acceptance, implementation model and economic value of PGx (Figure 2). The authors concluded that PGx is ready for widespread adoption, allowing it to play its role in the future of modern effective healthcare (30).

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