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Based on external sources (Symphony Health Solutions, Centers for Disease Control and Prevention) and own projections, PAION estimates that approximately 43 million procedures using procedural sedation took place in the U.S. in 2013, predominantly outside the hospital setting.
The growth of the procedural sedation market in the U.S. has been driven for many years by the increase in medical interventions requiring procedural sedation, such as colorectal cancer screening using colonoscopy, and an increase in demand for preventive screenings. According to iData Research, which consults an extensive collection of national- and state-level procedure databases to examine historical trends and create procedure forecasts in the U.S., 26.7 million colonoscopy and endoscopy claims were reported in 2015 in the U.S., and the number is expected to grow at an average rate of 2.6% annually through 2020. PAION estimates that 75% of the colonoscopies and endoscopies claimed were conducted in an out-patient setting due to the higher reimbursement fees compared to hospitals.
Regular endoscopic screening for people aged 50 or older is recommended and covered by all major health insurance plans, including those under the Centers for Medicare and Medicaid Services (“CMS”), a U.S. federal agency that administers Medicare (the national social insurance program), since effective prevention is considered to reduce the likelihood of incidence of illnesses such as cancer, thereby reducing the suffering of patients and related financial burden to be borne by the cancer victims and payors. Statistics show that the rate at which people are diagnosed with colon cancer in the U.S. has dropped by 30% in the last 10 years for those aged 50 years and older, partly due to more people getting recommended screening tests. Colorectal cancer is the third most diagnosed cancer and the third leading cause of cancer death in both men and women in the U.S. Despite the decrease in colorectal cancer death rates as a result of early screening and detection, it was reported in 2010 that only 59% of people aged 50 or older, for whom screening is recommended, reported having received colorectal cancer testing consistent with current guidelines. The market for endoscopies in gastroenterology represents the most lucrative market segment for remimazolam in procedural sedation with approximately 20 million procedures per year.
Currently, the most widely used products in procedural sedation are Propofol and Midazolam – both generic. PAION estimates that these two drugs each have a market share of approximately 50% in terms of volume of procedures performed in the out-patient market for colonoscopies. The Propofol label mandates the presence of an anesthesia professional throughout the procedure due to Propofol’s potential for respiratory- and cardio-depressive effects, which results in additional cost. Midazolam is considered to be a safer agent, but with longer onset and offset of action times which can impact patient throughput and overall efficiency.
As national health insurance reforms under the Patient Protection and Affordable Care Act (“PPACA”) are ongoing, increased enrollment and screenings are expected to result in a performance-based payment system that will seek to better align payments with high quality of care measures. This would imply that cost-effective medicines with clinical value will be used more extensively and that continued premium will be placed on innovative medicines with strong clinical profile. Thus, PAION believes that concerns related to the overall cost of procedures, driven by the need for anesthesia professionals monitoring during procedures using agents such as Propofol, will impact the choice of drug products for procedural sedation. Costs related to anesthesia services in gastrointestinal endoscopy procedures alone were estimated at USD 1.3 billion in 2009. Accordingly, while the primary target is the users of Midazolam, PAION expects reimbursement regimes under national and commercial healthcare systems, such as Medicare, which differentiate the amounts reimbursed to physicians and/or patients depending on whether an anesthesia professional’s service is used, may also positively impact the demand for products that do not require monitoring by an anesthesia professional.
PAION believes that remimazolam, subject to FDA approval with a safety labeling comparable to that of Midazolam, could benefit from the pending changes in payment policies, given that it could be administered under the supervision of a proceduralist, and would be able to face price-based competition from Midazolam based on its enhanced efficiency profile compared to Midazolam.