Off-label use of medicines has always been a vexed issue. In theory, treatments should only be used as indicated, where their safety and efficacy has been proven. Indeed, several pharma companies have received large fines for suggesting otherwise in their marketing efforts. Yet in practice off-label use is widespread and is, it seems, now officially endorsed in a growing number of countries.

Several European pharma associations are currently pursuing a case against Italy over a law, passed last June, that allows the country’s national health service to offer reimbursement for off-label use even when an alternative authorised treatment is available. But Italy isn't alone. France passed a similar law late last year, while some providers in the UK and health insurers in the USA are pushing for similar guidelines. Their aim is simply to cut costs by allowing doctors to use cheaper off-label drugs that may be just as effective as the authorised ones.

All these controversial regulations are directly related to just one drug: Roche’s Avastin (bevacizumab). Approved for a number of oncology indications, it is also widely used off-label as a treatment for wet age-related macular degeneration. Indeed, some independent studies suggest it is as effective as an approved treatment, Lucentis (ranibizumab), which emerged from the same Genentech labs but is sold by Novartis in Europe. Avastin is also a lot cheaper, at around $50 per injection in the USA, compared with $2,000 for Lucentis. Italy is already so frustrated that Roche has not sought a wet AMD approval for Avastin that it has fined both companies for collusion. The companies, for their part, claim the two drugs differ in effectiveness and side effects.

Yet beyond the narrow scope of this debate, the principles at stake are broad ones. Can off-label reimbursement be done for cost-cutting reasons when a previous EU ruling says this is illegal? France estimates the potential saving from using Avastin to be €200 million a year, a sizeable sum that could be spent on other patients. Will off-label reimbursement make a nonsense of the whole approval process, making companies reluctant to seek an authorised indication if they can simply sell off-label? EFPIA argues that it could, particularly if it spreads more widely.

Moreover, the long-term implications of the debate go beyond off-label usage. There is clearly something wrong with an approval system and a drug market where Roche has little incentive to seek a wet AMD indication for Avastin. Yet, as Genentech (a member of the Roche group) markets Lucentis in the USA, at a global level it would be competing with itself. It is an unusual but not unique situation. As drug prices polarise, and more pharma marketing alliances are struck, this will certainly not be the only company to shy away from seeking approval for a relatively cheap product that could cannibalise more profitable sales.

These questions will not go away soon but with any luck this specific case will eventually resolve itself. Competition in the wet AMD market will increase. As well as Bayer’s Eylea (aflibercept), already approved and 5% cheaper than Lucentis, another treatment, X-82 from Xcovery Vision, recently entered Phase II trials. Novartis itself has successfully completed Phase II trials for candidate RTH258. As well as benefiting patients, these new treatments could eventually bring down prices. Meanwhile, the pressure on Roche and Novartis to justify their pricing will remain intense, not least as a way of heading off yet more off-label usage. 

Ana Nicholls is chief healthcare analyst, Economist Intelligence Unit 

This article was published in the April issue of PharmaTimes Magazine. You can read the full magazine here