THE ECONOMICS OF
GENOMIC MEDICINE

WORKSHOP SUMMARY

Adam C. Berger and Steve Olson, Rapporteurs

Roundtable on Translating Genomic-Based Research for Health

Board on Health Sciences Policy

INSTITUTE OF MEDICINE

                                  OF THE NATIONAL ACADEMIES

THE NATIONAL ACADEMIES PRESS
Washington, D.C.
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Adam C. Berger and Steve Olson, Rapporteurs Roundtable on Translating Genomic-Based Research for Health Board on Health Sciences Policy

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THE NATIONAL ACADEMIES PRESS   500 Fifth Street, NW   Washington, DC 20001 NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. This project was supported by contracts between the National Academy of Sciences and the American Academy of Nursing (unnumbered contract); American College of Medical Genetics and Genomics (unnumbered contract); American Heart Association (unnumbered contract); American Medical Association (unnumbered contract); American Society of Human Genetics (unnumbered contract); Blue Cross and Blue Shield Association (unnumbered con- tract); Centers for Disease Control and Prevention (Contract No. 200-2011-38807); College of American Pathologists (unnumbered contract); Department of the Air Force (Contract No. FA7014-10-P-0072); Department of Veterans Affairs (Contract No. V101(93) P-2238); Eli Lilly and Company (Contract No. LRL-0028-07); Genetic Alliance (unnumbered con- tract); Health Resources and Services Administration (Contract No. HHSH250201100119P); Johnson & Johnson (unnumbered contract); The Kaiser Permanente Program Offices Com- munity Benefit II at the East Bay Community Foundation (Contract No. 20121257); Life Tech- nologies (unnumbered contract); National Cancer Institute (Contract No. N01-OD-4-2139, TO#189); National Coalition for Health Professional Education in Genetics (unnumbered contract); National Heart, Lung, and Blood Institute (Contract No. N01-OD-4-2139, TO#275); National Human Genome Research Institute (Contract No. N01-OD-4-2139, TO#264 and Contract No. HHSN263201200074I, TO#5); National Institute of Mental Health (Contract No. N01-OD-4-2139, TO#275); National Institute on Aging (Contract No. N01-OD-4-2139, TO#275); National Society of Genetic Counselors (unnumbered contract); Northrop Grumman Health IT (unnumbered contract); Office of Rare Diseases Research (Contract No. N01-OD-4-2139, TO#275); and Pfizer Inc. (Contract No. 140-N-1818071). Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the authors and do not necessarily reflect the views of the organizations or agencies that provided support for the project. International Standard Book Number-13:  978-0-309-26968-1 International Standard Book Number-10:  0-309-26968-7 Additional copies of this report are available for sale from the National Academies Press, 500 Fifth Street, NW, Keck 360, Washington, DC 20001; (800) 624-6242 or (202) 334-3313; http://www.nap.edu. For more information about the Institute of Medicine, visit the IOM home page at: www. iom.edu. Copyright 2013 by the National Academy of Sciences. All rights reserved. Printed in the United States of America The serpent has been a symbol of long life, healing, and knowledge among almost all cultures and religions since the beginning of recorded history. The serpent adopted as a logotype by the Institute of Medicine is a relief carving from ancient Greece, now held by the Staatliche Museen in Berlin. Suggested citation: IOM (Institute of Medicine). 2013. The economics of genomic medicine: Workshop summary. Washington, DC: The National Academies Press.

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“Knowing is not enough; we must apply. Willing is not enough; we must do.” —Goethe Advising the Nation. Improving Health.

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The National Academy of Sciences is a private, nonprofit, self-perpetuating society of distinguished scholars engaged in scientific and engineering research, dedicated to the furtherance of science and technology and to their use for the general welfare. Upon the authority of the charter granted to it by the Congress in 1863, the Acad- emy has a mandate that requires it to advise the federal government on scientific and technical matters. Dr. Ralph J. Cicerone is president of the National Academy of Sciences. The National Academy of Engineering was established in 1964, under the charter of the National Academy of Sciences, as a parallel organization of outstanding engineers. It is autonomous in its administration and in the selection of its members, sharing with the National Academy of Sciences the responsibility for advising the federal government. The National Academy of Engineering also sponsors engineer- ing programs aimed at meeting national needs, encourages education and research, and recognizes the superior achievements of engineers. Dr. Charles Vest is president of the National Academy of Engineering. The Institute of Medicine was established in 1970 by the National Academy of Sciences to secure the services of eminent members of appropriate professions in the examination of policy matters pertaining to the health of the public. The Insti- tute acts under the responsibility given to the National Academy of Sciences by its congressional charter to be an adviser to the federal government and, upon its own initiative, to identify issues of medical care, research, and education. Dr. Harvey V. Fineberg is president of the Institute of Medicine. The National Research Council was organized by the National Academy of Sci- ences in 1916 to associate the broad community of science and technology with the Academy’s purposes of furthering knowledge and advising the federal government. Functioning in accordance with general policies determined by the Academy, the Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in providing services to the government, the public, and the scientific and engineering communities. The Coun- cil is administered jointly by both Academies and the Institute of Medicine. Dr. Ralph J. Cicerone and Dr. Charles Vest are chair and vice chair, respectively, of the National Research Council. www.national-academies.org

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PLANNING COMMITTEE1 W. GREGORY FEERO (Chair), Contributing Editor, Journal of the American Medical Association, Chicago, IL PAUL R. BILLINGS, Chief Medical Officer, Life Technologies, Carlsbad, CA BRUCE BLUMBERG, Institutional Director of Graduate Medical Education, Northern California Kaiser Permanente, The Permanente Medical Group, Oakland, CA DENISE E. BONDS, Medical Officer, Division of Prevention and Population Sciences, National Heart, Lung, and Blood Institute, Bethesda, MD SARA COPELAND, Acting Chief, Genetic Services Branch, Health Resources and Services Administration, Rockville, MD MOHAMED KHAN, Leader of Radiation Oncology, Vancouver Cancer Centre, BC Cancer Agency, Vancouver, BC, Canada MUIN KHOURY, Director, National Office of Public Health Genomics, Centers for Disease Control and Prevention, Atlanta, GA DEBRA LEONARD, Professor and Vice Chair for Laboratory Medicine and Director of the Clinical Laboratories, Weill Cornell Medical Center of Cornell University, New York, NY MICHELE A. LLOYD-PURYEAR, Senior Medical and Scientific Advisor, National Institute of Child Health and Human Development, Bethesda, MD JOAN A. SCOTT, Executive Director, National Coalition for Health Professional Education in Genetics, Lutherville, MD KATHERINE JOHANSEN TABER, Senior Scientist, Genetics and Molecular Medicine, American Medical Association, Chicago, IL MICHAEL S. WATSON, Executive Director, American College of Medical Genetics and Genomics, Bethesda, MD CATHERINE A. WICKLUND, Past President, National Society of Genetic Counselors; Director, Graduate Program in Genetic Counseling; Associate Professor, Department of Obstetrics and Gynecology, Northwestern University, Chicago, IL IOM Staff ADAM C. BERGER, Project Director CLAIRE F. GIAMMARIA, Research Associate (until July 2012) TONIA E. DICKERSON, Senior Program Assistant 1  Institute of Medicine planning committees are solely responsible for organizing the work- shop, identifying topics, and choosing speakers. The responsibility for the published workshop summary rests with the workshop rapporteurs and the institution. v

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ROUNDTABLE ON TRANSLATING GENOMIC- BASED RESEARCH FOR HEALTH1 WYLIE BURKE (Co-Chair), Professor and Chair, Department of Bioethics and Humanities, University of Washington, Seattle SHARON TERRY (Co-Chair), President and Chief Executive Officer, Genetic Alliance, Washington, DC NAOMI ARONSON, Executive Director, Technology Evaluation Center, Blue Cross and Blue Shield Association, Chicago, IL EUAN ANGUS ASHLEY, Representative of the American Heart Association; Director, Center for Inherited Cardiovascular Disease, Stanford University School of Medicine, Palo Alto, CA PAUL R. BILLINGS, Chief Medical Officer, Life Technologies, Carlsbad, CA BRUCE BLUMBERG, Institutional Director of Graduate Medical Education, Northern California Kaiser Permanente, The Permanente Medical Group, Oakland, CA DENISE E. BONDS, Medical Officer, Division of Prevention and Population Sciences, National Heart, Lung, and Blood Institute, Bethesda, MD PAMELA BRADLEY, Staff Fellow, Personalized Medicine Staff, Office of In Vitro Diagnostics and Radiological Health, Center for Devices and Radiological Health, U.S. Food and Drug Administration, Silver Spring, MD PHILIP J. BROOKS, Health Scientist Administrator, Office of Rare Diseases Research, National Center for Advancing Translational Sciences, Rockville, MD ANN CASHION, Acting Scientific Director, National Institute of Nursing Research, Bethesda, MD C. THOMAS CASKEY, Professor, Baylor College of Medicine, Houston, TX MICHAEL J. DOUGHERTY, Director of Education, American Society of Human Genetics, Bethesda, MD VICTOR DZAU, President and Chief Executive Officer, Duke University Health System; Chancellor for Health Affairs, Duke University, Durham, NC W. GREGORY FEERO, Contributing Editor, Journal of the American Medical Association, Chicago, IL 1  Institute of Medicine forums and roundtables do not issue, review, or approve individual documents. The responsibility for the published workshop summary rests with the workshop rapporteurs and the institution. vii

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ANDREW N. FREEDMAN, Branch Chief, Clinical and Translational Epidemiology Branch, Epidemiology and Genetics Research Program, Division of Cancer Control and Population Sciences, National Cancer Institute, Rockville, MD GEOFFREY GINSBURG, Director, Center for Genomic Medicine, Institute for Genomic Sciences and Policy, Duke University, Durham, NC RICHARD J. HODES, Director, National Institute on Aging, Bethesda, MD SHARON KARDIA, Professor and Chair of Epidemiology; Director, Public Health Genetics Program; Director, Life Science and Society Program; Codirector, Center for Public Health and Community Genomics, University of Michigan School of Public Health, Ann Arbor MOHAMED KHAN, Representative of the American Medical Association; Leader of Radiation Oncology, Vancouver Cancer Centre, BC Cancer Agency, Vancouver, BC, Canada MUIN KHOURY, Director, National Office of Public Health Genomics, Centers for Disease Control and Prevention, Atlanta, GA GABRIELA LAVEZZARI, Assistant Vice President, Scientific Affairs, PhRMA, Washington, DC THOMAS LEHNER, Director, Office of Genomics Research Coordination, National Institute of Mental Health, Bethesda, MD DEBRA LEONARD, Representative of the College of American Pathologists; Professor and Vice Chair for Laboratory Medicine and Director of the Clinical Laboratories, Weill Cornell Medical Center of Cornell University, New York, NY ELIZABETH MANSFIELD, Director of the Personalized Medicine Staff, Office of In Vitro Diagnostics and Radiological Health, Center for Devices and Radiological Health, U.S. Food and Drug Administration, Silver Spring, MD KATHRYN McLAUGHLIN, Public Health Analyst and Program Officer, Genetic Services Branch, Maternal and Child Health Bureau, Health Resources and Services Administration, Rockville, MD KELLY McVEARRY, Senior Scientific Advisor, Information Systems Division, Northrop Grumman Health IT, Rockville, MD ROBERT L. NUSSBAUM, Chief, Division of Medical Genetics, Department of Medicine and Institute of Human Genetics, University of California, San Francisco, School of Medicine MICHELLE A. PENNY, Senior Director, Translational Medicine Group, Eli Lilly and Company, Indianapolis, IN viii

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AIDAN POWER, Vice President and Head PharmaTx Precision Medicine, Pfizer Inc., Groton, CT VICTORIA M. PRATT, Chief Director, Molecular Genetics, Quest Diagnostics Nichols Institute, Chantilly, VA RONALD PRZYGODZKI, Associate Director for Genomic Medicine and Acting Director of Biomedical Laboratory Research and Development, Department of Veterans Affairs, Washington, DC ALLEN D. ROSES, President and Chief Operating Officer, Cabernet, Shiraz and Zinfandel Pharmaceuticals; and Jefferson–Pilot Professor of Neurobiology and Genetics, Professor of Medicine (Neurology); Director, Deane Drug Discovery Institute; Senior Scholar, Fuqua School of Business, R. David Thomas Executive Training Center, Duke University, Durham, NC KEVIN A. SCHULMAN, Professor of Medicine and Business Administration; Director, Center for Clinical and Genetic Economics; Associate Director, Duke Clinical Research Institute, Duke University School of Medicine, Durham, NC JOAN A. SCOTT, Executive Director, National Coalition for Health Professional Education in Genetics, Lutherville, MD DAVID VEENSTRA, Professor, Pharmaceutical Outcomes Research and Policy Program, Department of Pharmacy, University of Washington, Seattle MICHAEL S. WATSON, Executive Director, American College of Medical Genetics and Genomics, Bethesda, MD DANIEL WATTENDORF, Deputy Chief, Medical Innovations, Department of the Air Force; Program Manager, DARPA/Defense Sciences Office, Arlington, VA CATHERINE A. WICKLUND, Past President, National Society of Genetic Counselors; Director, Graduate Program in Genetic Counseling; Associate Professor, Department of Obstetrics and Gynecology, Northwestern University, Chicago, IL JANET WILLIAMS, Representative of the American Academy of Nursing; Professor of Nursing, The University of Iowa College of Nursing, Iowa City Fellows SEAN P. DAVID, James C. Puffer, M.D./American Board of Family Medicine Fellow SAMUEL G. JOHNSON, American Association of Colleges of Pharmacy/ American College of Clinical Pharmacy Anniversary Fellow ix

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IOM Staff ADAM C. BERGER, Project Director CLAIRE F. GIAMMARIA, Research Associate (until July 2012) TONIA E. DICKERSON, Senior Program Assistant Board on Health Sciences Policy Staff DONNA RANDALL, Administrative Assistant ANDREW POPE, Director x

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Reviewers This workshop summary has been reviewed in draft form by individu- als chosen for their diverse perspectives and technical expertise, in accor- dance with procedures approved by the National Research Council’s Report Review Committee. The purpose of this independent review is to provide candid and critical comments that will assist the institution in making its published workshop summary as sound as possible and to ensure that the workshop summary meets institutional standards for objectivity, evidence, and responsiveness to the study charge. The review comments and draft manuscript remain confidential to protect the integrity of the process. We wish to thank the following individuals for their review of this workshop summary. James P. Evans, Department of Genetics, University of North Carolina at Chapel Hill Deborah Heine, Claire Altman Heine Foundation, Inc. David O. Meltzer, Section of Hospital Medicine and Center for Health and the Social Sciences, The University of Chicago Scott Ramsey, Cancer Prevention Program, Division of Public Health Science, Fred Hutchinson Cancer Research Center Although the reviewers listed above have provided many constructive comments and suggestions, they did not see the final draft of the workshop summary before its release. The review of this workshop summary was overseen by Melvin Worth. Appointed by the Institute of Medicine, he was xi

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xii REVIEWERS responsible for making certain that an independent examination of this workshop summary was carried out in accordance with institutional proce- dures and that all review comments were carefully considered. Responsibil- ity for the final content of this workshop summary rests entirely with the rapporteurs and the institution.

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Acknowledgments The support of the sponsors of the Institute of Medicine Roundtable on Translating Genomic-Based Research for Health was crucial to the plan- ning and conduct of the workshop Assessing the Economics of Genomic Medicine and the development of the workshop summary report titled The Economics of Genomic Medicine. Federal sponsors are the Centers for Disease Control and Prevention; Department of the Air Force; Depart- ment of Veterans Affairs; Health Resources and Services Administration; National Cancer Institute; National Heart, Lung, and Blood Institute; National Human Genome Research Institute; National Institute of Mental Health; National Institute on Aging; and Office of Rare Diseases Research. Nonfederal sponsorship was provided by the American Academy of Nurs- ing; American College of Medical Genetics and Genomics; American Heart Association; American Medical Association; American Society of Human Genetics; Blue Cross and Blue Shield Association; College of American Pathologists; Eli Lilly and Company; Genetic Alliance; Johnson & Johnson; The Kaiser Permanente Program Offices Community Benefit II at the East Bay Community Foundation; Life Technologies; National Coalition for Health Professional Education in Genetics; National Society of Genetic Counselors; Northrop Grumman Health IT; and Pfizer Inc. The Roundtable wishes to express its gratitude to the expert speakers whose presentations helped outline the challenges and proposed potential solutions for assessing the economics of genomic medicine. The Roundtable also wishes to thank the members of the planning committee for their work in developing an outstanding workshop agenda. The project director would like to thank project staff who worked diligently to develop both the work- shop and the resulting summary. xiii

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Contents ABBREVIATIONS AND ACRONYMS xix 1 INTRODUCTION AND OVERVIEW 1 Organization of the Workshop, 2 Major Themes of the Workshop, 4 2 GENOMICS, POPULATION HEALTH, AND TECHNOLOGY 9 The Value of Genomic Data, 10 The Long-Term and Mid-Term Promises of Genomics, 10 Genomic Data in Healthy People, 11 Challenges to Implementation, 13 Another Medical Test, 14 3 THE INTERSECTION OF GENOMICS AND HEALTH ECONOMICS 15 Economic Evaluation Tools, 16 Incremental Cost-Effectiveness Ratios, 18 Genome Sequencing, 18 Comparative-Effectiveness Research, 20 Three Challenges, 21 4 PRECONCEPTION CARE AND SEQUENCING 23 A Clinician’s Perspective, 24 A Futurist’s Perspective, 28 xv

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xvi CONTENTS A Patient’s Perspective, 29 Economic Perspectives, 32 Discussion, 34 5 UNPROVOKED DEEP VEIN THROMBOSIS 37 A Clinician’s Perspective, 38 A Futurist’s Perspective, 41 A Patient’s Perspective, 42 Economic Perspectives, 44 Discussion, 47 6 CANCER CARE 49 A Clinician’s Perspective, 50 A Futurist’s Perspective, 51 A Patient’s Perspective, 52 Economic Perspectives, 54 Discussion, 55 7 PANELISTS’ AND STAKEHOLDERS’ PERSPECTIVES 59 A Clinician’s Perspective, 60 A Researcher’s Perspective, 61 A Chief Scientific Officer’s Perspective, 61 A Patient’s Perspective, 63 A Public Health Officer’s Perspective, 64 A Hospital Administrator’s Perspective, 65 Economic Perspectives, 67 Additional Issues, 70 Closing Remarks, 70 REFERENCES 73 APPENDIXES A WORKSHOP AGENDA 77 B SPEAKER BIOGRAPHICAL SKETCHES 87 C STATEMENT OF TASK 99 D REGISTERED ATTENDEES 101

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Figure, Tables, and Box FIGURE 3-1  The change in costs and change in effectiveness compared with current practice divides the results of cost-effectiveness analyses into four quadrants, 19 TABLES 3-1 Types of Economic Evaluations in Health Care, 17 3-2 Factors That Influence the Cost-Effectiveness of Genomic Testing Strategies, 20 BOX 7-1 Research Needs Identified by Individual Speakers, 71 xvii

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Abbreviations and Acronyms ACOG American College of Obstetricians and Gynecologists CEA cost-effectiveness analysis CLIA Clinical Laboratory Improvement Amendments CMS Centers for Medicare & Medicaid Services CUA cost-utility analysis EGFR epidermal growth factor receptor FDA U.S. Food and Drug Administration INR international normalized ratio IOM Institute of Medicine NIH National Institutes of Health QALY quality-adjusted life year xix

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