Market Scope: US Cataract Pharmaceuticals Evolve in Drug Delivery
US cataract surgeons showed a preference for incremental improvement in drug delivery over revolutionary change in the first full year for three new corticosteroid products to manage inflammation and pain after cataract surgery, according to a Market Scope report.
The products hit the market in 2019, using well-established corticosteroid agents, but new drug-delivery technologies.
Inveltys improved the delivery of loteprednol etabonate eye drops by halving the frequency of administration from four times a day to two. Dexycu and Dextenza dramatically altered the delivery of dexamethasone to the eye using two unique technologies that extended the effect of one administration up to 30 days.
Inveltys easily won the contest for unit use, while Dextenza won the race for revenue.
The difference appears to be due to billing and cost. Dextenza and Dexycu are Medicare Part B drugs. They are administered by the physician—Dextenza by insertion of a punctal plug, and Dexycu by intracameral injection.
Both drugs have temporary pass-through status, which means the physician bills Medicare, and Medicare reimburses 100 percent of the cost when the drug is used in a hospital operating room and 80 percent when it is used in an ambulatory surgery center.
Inveltys is a Medicare Part D drug. The patient administers the medication at home and typically pays 20 percent of the list price at the pharmacy, although coverage provided by Medicare Advantage plans and commercial insurers varies.
Inveltys, with an average GoodRx price of $225, was the cheapest of the three products. It cost less than half the price of either of the other two. That made a difference in a patient’s Medicare co-payment, but many patients have supplemental insurance that renders the co-pay irrelevant.
However, because Medicare and commercial insurance plans typically demand discounts for a listing on their outpatient drug formulary, Kala Pharmaceuticals reported getting an average price of $58 per Inveltys prescription in 2020. That compared with pass-through prices of $555 and $595, respectively, for Dextenza and Dexycu.
Some surgeons balked at the prices of the extended drug-release products. Eighty-four percent of surgeons who responded to Market Scope’s 2021 Cataract Pharmaceuticals Survey ranked price as the first or second highest barrier to using such products.
Individual responses included comments such as, “I won’t use anything that costs more than I get paid,” and expressions of the belief that, over the long run, the more Medicare must pay for drugs, the less it will pay for surgeon services.
These new products accounted for an estimated 11 percent of manufacturer revenue from steroids used in association with cataract surgery in 2020.
Market Scope’s special-edition “2021 US Cataract Surgery Pharmaceuticals Market Report” estimates that steroids are responsible for 43.6 percent of manufacturer revenue from single-agent pharmaceuticals used to manage inflammation and pain after cataract surgery in the US.
Management of inflammation and pain after cataract surgery is the largest revenue category in the segment, almost twice as large as all other categories combined.
The “2021 US Cataract Surgery Pharmaceuticals Market Report” forecasts that total manufacturers’ revenue in the segment will grow from $1.2 billion in 2021 to $1.3 billion in 2026. Inflammation and pain are the focus of clinical development.
The cataract surgery pharmaceutical market will be shaped over the next 5 years in the US by the aging population, technological advancements, health care reimbursement policy, regulatory requirements, and the growing public demand for better visual outcomes following cataract and refractive IOL surgery.
This market is quite dispersed, with only two companies have double digit shares of the market: Bausch + Lomb and Novartis. The next closest competitors are Omeros and Allergan. A single branded product, even with small unit share, can vault a company into a leading position in the market as Omidria did for Omeros.
Market Scope’s new, special-edition “2021 US Cataract Pharmaceuticals Market Report” was published in April.