Oncology Insights: December 2017

Cardinal Health Specialty Solutions Oncology Insights: December 2017 Views on New and Emerging Therapies From Specialty Physicians Nationwide

A message from the President Joe DePinto Welcome to the second edition of Oncology Insights, the latest in our series of research-based reports developed to share viewpoints on issues of importance for specialty care providers, biopharma companies and other healthcare stakeholders. Thus far, 2017 has been a landmark year for advancement in oncology care. Some of the notable FDA approvals have included the first two CAR T-cell therapies; several targeted agents for acute myeloid leukemia; and the first two biosimilars approved for therapeutic care in cancer. In this report, we offer insights on how oncologists view innovative therapies that have the potential to fundamentally change and improve cancer treatment, as well as challenges that may impede their adoption. The research highlighted in this report was conducted at four Cardinal Health Oncology Summits held earlier this year. These events brought together a total of more than 200 oncologists from across the United States. These providers represent a mix of community and hospital-based practices, with research conducted by audience-response polling. Oncology Insights reflects our commitment, as a leading provider of solutions to the specialty care industry, to sharing research and expert perspectives that will help support the delivery of better care options for patients. We hope you find this report valuable in advancing constructive dialogue across our industry. Please watch for future reports as we explore additional issues of importance to specialty medicine. Sincerely, Joe DePinto President, Cardinal Health Specialty Solutions 2

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Breakthroughs and Barriers to Wider CAR T-Cell Therapy Use 4

CAR T-CELL THERAPY Excitement for immunotherapy has spread throughout the oncology community in recent years as new immuno-oncology therapies have offered the potential for remission in patients who otherwise have few options. Chimeric antigen receptor T-cell (CAR-T) therapy has emerged as the next important movement in immunotherapy innovation. The rapid and complete responses in highly refractory patients enrolled in CAR-T clinical trials indicate that it may be a game changer for cancer therapy. Earlier this year, the FDA took historic action by approving two CAR-T therapies Novartis Kymriah, indicated for treatment of pediatric and young adult patients with a form of acute lymphoblastic leukemia, and Kite Pharma s Yescarta, indicated for adult patients with relapsed/refractory diffuse large B cell and high-grade lymphomas, who have undergone two regimens of chemotherapy without success. While the potential impact of these therapies on cancer treatment is promising, there are questions about the commercial uptake of CAR-T due to concerns about toxicity, costs and complexity of administration. Because most cancer patients are seen in the community setting, community oncologists will play an instrumental role in patient referral and CAR-T adoption. Our research on this topic is designed to better understand their perceptions about CAR-T and the potential barriers to adoption. 5

OUR VIEWPOINT Chadi Nabhan, MD, MBA, FACP Vice President and Chief Medical Officer, Cardinal Health Specialty Solutions Our research with community oncologists indicates a mix of perspectives about CAR T-cell therapies. While 51 percent see CAR-T as a potentially game-changing approach, 41 percent say concerns about toxicity might preclude them from referring patients and 57 percent say the high cost of the therapy might cause them to limit referrals. Interestingly, while toxicity and costs appear to be potential threats to CAR-T adoption, the logistics of administering care was also indicated as a top barrier to prescribing. The concerns shared by community oncologists may reflect a lack of familiarity with published clinical data on CAR-T, or they may reveal a lack of first-hand experience, as the therapies are so new to the market. However, given the complexities of CAR-T synthesis and delivery, the need for continued and ongoing physician education is clear. Although administration of CAR-T will likely occur at specialized medical centers, community oncologists will need to understand the therapeutic process, the incidence of toxicity and how it will be managed, the potential for relapse, and what follow-up care will be required once the patient returns to the community setting. Manufacturers of CAR-T therapies should also evaluate how they will use patient support services to ease concerns about the logistics of administration. For example, CAR-T may require sick patients and their caregivers to travel a significant distance to a designated treatment facility and stay there for several weeks during the treatment and monitoring duration. The availability of programs for patients who require assistance with these needs will be an important factor in driving adoption. 6

CAR T-CELL THERAPY Many oncologists viewed CAR-T as a potentially dramatic advance for cancer treatment. How would you best describe CAR T-cell therapy? 30% A new treatment option 51% A potentially game-changing approach to cancer treatment 4% A last-line approach for seriously ill patients 15% Another immunooncology option, like PD-1 inhibitors N=170 MORE THAN 50% OF ONCOLOGISTS SAY CAR-T IS POTENTIALLY A GAME CHANGER FOR CANCER TREATMENT. 7

CAR T-CELL THERAPY Cumbersome logistics of administering care is a top concern equal to or greater than cost. Despite dramatic responses to CAR-T in clinical trials, there are significant challenges associated with the therapy including high costs, a complex administration process and a high occurrence of cytokine release syndrome (CRS) among patients. While the toxicity and costs were significant concerns for oncologists, the logistics of the administration process was cited most often as a significant barrier. In your opinion, what would be the top two barriers to your prescribing CAR T-cell therapy? Logistics of administering and following patients are cumbersome Cost of therapy Toxicity is too high I do not know enough about CAR T-cell therapy to prescribe Efficacy data is immature Patients treated on clinical trials are not representative of the real-world patient population 16% 15% 13% 44% 35% 59% N=178 <1in6 TO PARTICIPATING ONCOLOGISTS SAID THEY DO NOT KNOW ENOUGH ABOUT CAR-T PRESCRIBE. 8

CAR T-CELL THERAPY Most oncologists said cost and toxicity concerns may limit the number of patients they would refer for this treatment. Asked specifically about cost and toxicity, participating oncologists raised concerns. However, nearly 40 percent thought costs were reasonable or not inappropriate based on efficacy data. Regarding the toxicity profile of CAR T-cell therapy, which of the following statements best describes your perception? 2% The toxicity profile is very concerning and would preclude me from referring patients for this treatment. 41% The toxicity profile is concerning and might limit the number of patients I would refer for this treatment. 26% More data about toxicity is needed before I would feel comfortable referring patients for this treatment. 31% The toxicity risk is similar to transplantation; it would not preclude me from referring patients for treatment. N=176 Regarding the costs of CAR T-cell therapy, which of the following statements best describes your perception? 4% Costs are reasonable given this is a breakthrough treatment. 57% Costs are very high and might cause me to limit the number of patients I would refer for this treatment. 35% Costs are high, but not inappropriate based on the efficacy data. 4% Costs are much too high. I will not refer patients for this treatment unless costs are lowered. 57% OF ONCOLOGISTS SAID THE CO TS ARE VERY HIGH AND MAY LIMIT THE NUMBER OF PATIENTS THEY WOULD REFER. N-173 9

Increasing Acceptance of Biosimilars as Innovation Grows 10

BIOSIMILARS Over the past few years, there has been much debate about the impact of biosimilars on the U.S. oncology market. Biosimilars, biological medicines that contain a highly similar version of the active substance in an approved biologic product, have been prescribed in Europe for more than a decade, but are still relatively new to the United States. Today, eight biosimilars have been approved by the FDA including three products for use with cancer patients and a significant number of new oncology biosimilars are expected to come to market over the next few years. While it is early to calculate the exact effect that biosimilars will have on healthcare costs, there is an expectation that the wide availability of biosimilars will eventually drive greater price competition and lead to cost savings in specialty therapeutic categories like oncology and rheumatology. Yet despite the opportunity for savings, many physicians have initially expressed hesitancy about prescribing biosimilars in place of reference products because of the potential for differences. Understanding how oncologists view biosimilars and how their perceptions are changing as more biosimilar products come to market is critical to determining how treatment trends are likely to evolve over the next few years. 11

OUR VIEWPOINT Bruce Feinberg, DO Vice President and Chief Medical Officer, Cardinal Health Specialty Solutions In the past two years, eight biosimilars have been approved by the FDA, three for use in cancer patients. Filgrastim is a supportive care granulocyte colony stimulating factor that is similar to the reference product Neupogen, approved by the FDA in March 2015. Bevacizumab (simlilar to reference product Avastin) was approved by the FDA in September 2017, but at the time this report was published, was not yet in the supply chain. In December 2017, a third biosimilar product, Ogivri (similar to reference product Herceptin), was approved by the FDA, but is also not yet available. Despite the fact that many practitioners have never prescribed a biosimilar, the awareness of this emerging drug class is strong with only 17 percent of participating oncologists lacking familiarity. This is a significant shift from a year ago when 22 percent indicated that they were not very familiar with biosimilars. Providers are generally comfortable with the FDA approval process, although label expansion through extrapolation remains a point of concern. In spite of this and their lack of experience with biosimilars, a strong majority state a willingness to prescribe biosimilars across all reference brand label indications and therapeutic areas, regardless of whether the biosimilar is supportive care or therapeutic, or whether it is a palliative treatment or used with curative intent. Such responses suggest the barriers to biosimilar adoption are much lower now than they were a year or two ago. Interestingly, our research shows that oncologists have high expectations of how much savings they hope to gain as a result of prescribing biosimilars. These expectations, along with issues such as medical benefit policies, financial impacts of pricing and rebates, and behavioral economic biases that favor the status quo, will impact how quickly oncologists adopt biosimilars. Experience in other disease areas indicates that the real-world usage of biosimilars in oncology treatment may vary significantly from stated intent. We will continue tracking these issues closely as additional oncology biosimilars come to market over the coming months. 12

BIOSIMILARS Familiarity with biosimilars is growing. Over the past year, we asked similar questions designed to gauge oncologists familiarity with biosimilars. In 2017, 84 percent of participating oncologists indicated they were either somewhat familiar or very familiar with biosimilars compared to 78 percent in 2016. How would you describe your familiarity with biosimilars? VERY FAMILIAR, I understand how the FDA defines and evaluates biosimilars and have some first-hand experience. SOMEWHAT FAMILIAR, I ve read research about them, but do not have much first-hand experience. 30% 40% 44% 48% NOT VERY FAMILIAR, I understand that they are like generics but different. 17% 22% 2017 N = 174; 2016 N = 210 2017 2016 YEAR-OVER-YEAR, MORE PARTICIPATING ONCOLOGISTS EXPRESSED FAMILIARITY WITH BIOSIMILARS. 13

BIOSIMILARS Most participating oncologists are comfortable with the FDA approval process for biosimilars. The FDA has stated that bringing new biosimilars to patients while meeting rigorous standards for safety and effectiveness can lower costs and increase access to important therapies. But is the FDA rushing biosimilars to market without adequate evaluations? Based on the results of the summits, only a small group of participating oncologists believe that to be the case. 16% I am not familiar enough with the FDA approval process of biosimilars to assess. 44% I am comfortable with the FDA approval process of biosimilars. N=182 Based on your understanding of the FDA approval process of biosimilars, which of the following statements best describes your perception? 5% I think the FDA is rushing biosimilars through the approval process without adequate rigor to ensure safety and efficacy. 35% I am comfortable with FDA approval of biosimilars when there is clinical trial evidence, but I have concerns about extrapolation for other indications where there is not clinical trial evidence. NEARLY 80% OF PARTICIPATING ONCOLOGISTS SAID THEY ARE COMFORTABLE WITH THE FDA APPROVAL PROCESS OF BIOSIMILARS. 14

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BIOSIMILARS Most oncologists expressed a willingness to consider prescribing biosimilars both as a primary therapy (with curative intent) and as an adjuvant therapy. To better understand how oncologists would prescribe biosimilars, participants were asked how they would utilize two therapies that were in the late stages of the approval process. Since that time, the Herceptin biosimilar has been approved by the FDA. The question assumed the treatments would be covered by insurance, meaning the responses focused on the anticipated clinical effectiveness of the treatments. If a Herceptin (trastuzumab) biosimilar were approved today and was paid for by insurance, I would most likely: 15% Prescribe only in the setting of metastatic breast cancer 2% Prescribe only in the setting of adjuvant breast cancer 73% Prescribe in the setting of metastatic breast cancer and adjuvant breast cancer 10% I would not prescribe a Herceptin biosimilar N=184 If a Rituxan (rituximab) biosimilar were approved today and was paid for by insurance, I would most likely: 2% 0% 4% 16% 69% 1% 8% N=192 Prescribe a Rituxan biosimilar in CLL and/or indolent NHL when cure is not the goal Prescribe a Rituxan biosimilar in diffuse large cell lymphoma with a curative intent Prescribe a Rituxan biosimilar in diffuse large cell lymphoma when cure is not the goal Prescribe a Rituxan biosimilar in CLL and/or indolent NHL when cure is not the goal; and in diffuse large cell lymphoma when cure is not the goal I would only prescribe a Rituxan biosimilar when used as maintenance I would not prescribe a Rituxan biosimilar Prescribe a Rituxan biosimilar in CLL and/or indolent NHL when cure is not the goal; in diffuse large cell lymphoma with a curative intent; and in diffuse large cell lymphoma when cure is not the goal 16

BIOSIMILARS Potential cost savings are an important factor for oncologists when considering biosimilars. As noted earlier, it is widely expected that biosimilars will eventually reduce costs by driving price competition. These potential savings emerged as a key issue for participating oncologists. How important is it to you for you/your practice to save costs by prescribing biosimilars versus reference products?* Extremely important Very important Moderately important Slightly important Not at all important N=191 *From summits conducted in 2016 8% 5% 21% 36% 30% 66% OF ONCOLOGISTS SAY IT IS EXTREMELY OR VERY IMPORTANT TO SAVE COSTS WHEN PRESCRIBING BIOSIMILARS. 17

Are AML Treatment Trends Changing with New Targeted Therapies? 18

Despite its modest efficacy, the well-known 7+3 chemotherapy regimen has been the mainstay for treating acute myeloid leukemia (AML) patients (non-apl) who are fit and able to tolerate aggressive induction chemotherapy. Except for escalating the dose of daunorubicin, no substantial advances in AML treatment have taken place for decades. However, in recent years, translational and clinical research efforts have successfully refined the prognosis of AML by identifying the genetic markers associated with the disease. In 2017, this effort culminated with the introduction of three new targeted therapies for AML. Two of these drugs target genetic mutations: Enasidenib (Celgene) for AML patients who carry the IDH2 mutation; and midostaurin (Novartis) for AML patients carrying the FLT3+ mutation. In addition, another agent gemtuzumab-ozogamicin (Pfizer) was approved for AML patients who are CD33-positive. While these advances offer exciting new possibilities for AML patients, they also require new behaviors in how physicians evaluate and select treatment options. Genetic testing with timely and reproducible results is key to identifying patients who can benefit from these therapeutic advances. At our recent oncology summits, we polled oncologists on the degree to which they are adopting genetic testing, the timeliness of the results and where they are choosing to treat their AML patients. AML THERAPIES 19

OUR VIEWPOINT Chadi Nabhan, MD, MBA, FACP Vice President and Chief Medical Officer, Cardinal Health Specialty Solutions The success of targeted therapies is dependent upon whether treating physicians will test for targets or mutations on a consistent basis and receive results in a timely manner. The majority of physicians surveyed (85 percent) affirmed that they test all AML patients for presence of genomic targets or mutations. This bodes well for AML patients, but it also suggests that we may see a rapid uptake of genetic testing in other disease categories as more targeted therapies come to market and more mutations are identified. A less encouraging sign is that 21 percent of oncologists said the turnaround time for test results exceeds 14 days. Moreover, less than 50 percent of oncologists have access to the test at their own institution, while the remainder must outsource the test. This is concerning because timely initiation of AML therapy is instrumental to improving outcomes. Another important question is whether the availability of new treatments will lead to improved access to AML care, particularly for elderly patients. Registry data shows that historically almost 20 percent of newly diagnosed AML patients received palliative care rather than active therapy 1. While we do not have definitive insights into how these trends may change, our research shows that 31 percent of oncologists are more likely to refer newly diagnosed AML patients to academic centers now that new treatment options are available. That suggests patients who would have previously been offered palliative care may now have the opportunity to receive active therapy. Most participating oncologists said they always perform genomic/ mutational analysis. With two new AML therapies targeting genetic mutations, genomic testing has become an essential step in determining the optimal treatment plan for patients. It is encouraging that 85 percent of physicians say they always perform genomic testing, given that this analysis was not standard practice a year ago. 20

AML THERAPIES For your newly diagnosed AML patients, how often do you perform genomic/mutational analysis? 85% Always 6% Only for patients whom I view to be young and fit 9% I do not perform any genomic/ mutational testing N=142 OF PARTICIPATING ONCOLOGISTS SAID THEY ALWAYS PERFORM 85%GENOMIC/MUTATIONAL TESTING. Most oncologists said they receive genomic/mutational testing results within 14 days. Because AML can be a fast-progressing disease, the ability to diagnose patients and get them started on therapy quickly can be an important issue. Which of the following statements best describes the availability of genomic/mutational testing at your local institution? 7% 36% 6% 32% 15% 4% N=148 It is available and we receive results in less than 7 days. It is available and we receive results in 7-14 days. It is available and we receive results in 15 days or more. It is not available and we send tests out; turnaround is less than 14 days. It is not available and we send tests out; turnaround is 14 days or more. We do not conduct genomic/mutational testing. 21% OF ONCOLOGISTS SAY THE TURNAROUND TIME FOR GENOMIC TESTING IS 14 DAYS OR MORE. 21

AML THERAPIES While most oncologists said recent FDA approval of new AML treatment options does not make them more likely to refer patients to academic medical centers, a significant number are less likely to treat locally. Regarding the recent FDA approval of new treatment options for AML, which of the following best describes your approach? 31% The approval of new AML treatments makes me more likely to refer newly diagnosed AML patients to academic centers. 55% The approval of new AML treatments has no impact on the number of newly diagnosed AML patients I refer to academic centers. \13% I do not refer AML patients to academic centers. I treat them locally. N=157 MORE THAN 30% OF PARTICIPATING ONCOLOGISTS SAID THEY ARE MORE LIKELY TO REFER PATIENTS TO ACADEMIC MEDICAL CENTERS. 22

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Contributors CAR T-Cell & AML Chadi Nabhan, MD, MBA, FACP Vice President, Chief Medical Officer Cardinal Health Specialty Solutions Biosimilars Bruce Feinberg, DO Vice President, Chief Medical Officer Cardinal Health Specialty Solutions References 1 Medeiros B, Big data analysis of treatment patterns and outcomes among elderly acute myeloid leukemia patients in the United States, Ann Hematol. 2015; 94:1127 1138 Methodology The research was fielded at four live summit events, hosted by Cardinal Health Specialty Solutions, in September, October and November 2017, using audience response system technology. More than 200 oncologists from a mix of community and hospital-based practices participated in the research. About Cardinal Health Specialty Solutions Cardinal Health Specialty Solutions creates opportunity for specialty pharmaceutical manufacturers and providers. Our dynamic team of problem solvers understands the complexities of specialty healthcare, and we draw on our deep expertise to help ensure patients get the therapies they need, when they need them. From supporting manufacturers on the path to successful product approval, commercialization and optimization to delivering the products providers need with the efficiencies they want, we use our experience and expertise to help our customers achieve success and improve specialty care. Want to learn more? Let s explore how we can help. 888.438.2673 specialtysolutions@cardinalhealth.com Visit us online. Dive deeper into our solutions and services at cardinalhealth.com/specialtysolutions 2017 Cardinal Health. All Rights Reserved. CARDINAL HEALTH, the Cardinal Health LOGO and Essential to care are trademarks or registered trademarks of Cardinal Health. All other marks are the property of their respective owners. Lit. No. 1SS17-740710 (11/2017)