Pharmaceutical policies: effects of reference pricing, other pricing, and purchasing policies

Drug pricing and transparency in Europe and the United States: what is it and how does it work?

INTRODUCTION

As drug prices are viewed to be opaque, there have been increasing societal demands on policy and decision makers to implement initiatives that promote drug price transparency.

AREAS COVERED

This Perspective discusses what drug price transparency is and how it works in theory and in practice.

EXPERT OPINION

Transparency on drug prices may target payers, patients and health care professionals; and may relate to prices at each stage in a drug's distribution system. Although proponents claim that drug price transparency will reduce prices and increase patient access, others expect the opposite effect. Nevertheless, a number of international organizations, countries and consumer groups have taken steps to enhance drug price transparency. This has occurred despite a lack of theoretical clarity and of evidence about its likely impact. Policy and decision makers need to consider how payers and pharmaceutical companies are likely to react to drug price transparency and need to be aware that transparency may produce different effects depending on the country to which it is applied. Even though we believe that full drug price transparency is elusive, various incremental measures can be taken to move toward it.

Physical-chemical repurposing of drugs. History of its formation in Russia

It is reported that the traditional scheme of finding and developing a new drug and conducting the whole complex of preclinical studies requires several thousand chemical compounds, hundreds of millions of US dollars and more than 12 years of work. It is shown that physicochemical pharmacology was born in Russia at the end of the 20th century, which in our days has been transformed into physicochemical repurposing of known medicines. The first successfully repurposed known drug was a solution of 4% potassium chloride, which had previously traditionally belonged to the group of macro- and microelements, used by intravenous injections to regulate acid-base balance and rhythmic activity of the heart. In 1983, it was stated that this medicinal solution, when heated to 3942C and applied topically by irrigation of the bleeding surface, could be classified as a vasoconstrictor and hemostatic drug. Hyperthermia was used as a physico-chemical reprofiling factor, which, according to the Arrhenius law, accelerated and intensified, on the one hand, the spastic action of K+ cations on the gaping blood vessels (formation of hyperkalium contracture in the smooth muscles of the vascular wall) and, on the other hand, the blood clotting process in the wound. In subsequent years, the promise of physicochemical repurposing of known drugs was shown on the example of water, hydrogen peroxide, sodium chloride and sodium bicarbonate by purposefully changing their temperature, acid, osmotic activity, as well as the amount and quality of gas content (passing). A chronology of the physicochemical repurposing of known drug solutions and tablets is described and the essence of such new groups of drugs as bleachers of bruises and pyolytics is given. It is shown that both groups of drugs were discovered in Russia and are intended for local use to bleach bruises (blood stains) and dissolve thick mucus, sputum, pus, blood clots, meconium and other dense biological tissues containing the enzyme catalase. It is pointed out that the advantage and at the same time the limitation of the known drugs repurposed according to this scheme is their local application, since their new pharmacological activity is caused mainly by the physical and chemical principle of action, which is manifested by local interaction with the selected area of the patients organism.

Impact of prescription length supply policy on patient medication adherence in Thailand

BACKGROUND

Phramongkutklao Hospital is one of the largest military hospitals in Thailand. Beginning in 2016, an institutional policy was implemented in which medication prescription length was increased from 30 to 90 days. However, there have been no formal investigations into how this policy has impacted medication adherence among patients in hospitals. As such, this study evaluated how prescription length impacted medication adherence among dyslipidemia and type-2 diabetes patients who were treated at Phramongkutklao Hospital.

METHODS

This pre-post implementation study compared patients who received prescription lengths of 30 and 90 days based on information recorded in the hospital database between 2014 and 2017. Therein, we used the medication possession ratio (MPR) to estimate patient adherence. Focusing on patients with universal coverage insurance, we employed the difference-in-difference method to examine changes in adherence from before and after policy implementation, then conducted a logistic regression to test for associations between the predictors and adherence.

RESULTS

We analyzed data from a total of 2,046 patients, with equal amounts of 1,023 placed into the control group (no change to 90-day prescription length) and intervention group (change from 30 to 90-day prescription length). First, we found that increased prescription length was associated with 4% and 5% higher MPRs among dyslipidemia and diabetes patients in the intervention group, respectively. Second, we found that medication adherence was correlated with sex, comorbidities, history of hospitalization, and the number of prescribed medications.

CONCLUSION

Increasing the prescription length from 30 to 90 days improved medication adherence in both the dyslipidemia and type-2 diabetes patients. This shows that the policy change was successful for patients in the hospital considered for this study.

The price and affordability of essential medicines, progress and regional distribution in China: a systematic review

Background: Essential medicine is a vital component to assure universal access to quality healthcare. However, the trend of affordability to essential medicines in China and its regional differences were not yet fully understood. This study aimed to systematically evaluate the price and affordability of essential medicines, their progress, and regional distribution in China in the last decades. Methods: We searched seven databases and three websites for potentially eligible studies from inception until March 2022. Studies on the price and affordability of essential medicines investigated in China were included. Median and interquartile range (IQR) was used to describe the price and affordability of essential medicines, and compared in three periods, before 2009, from 2009 to 2014, and from 2015 to 2019. Subgroup analysis was performed to examine the price and affordability by regions, health facilities, and ATC categories of medicines. The study was registered with PROSPERO (CRD42022310173). Results: A total of 65 studies including 11,639 health facilities investigated between 2006 and 2019 were included in this review. Median price ratios (MPR) and affordability of essential medicines were reported in 44 studies and 50 studies, respectively. The median MPRs of essential medicines in China was 1.59 (IQR: 5.39), with a tendency to rise first and then fall from 2006 to 2019. And the median affordability was equal to 0.88 (IQR: 2.58) days' wage of the lowest paid unskilled government worker, but steadily rose from 2006 to 2019. Subgroup analysis showed that the affordability in the western region (1.40, IQR: 2.88), urban area (0.95, IQR: 2.80), private sector (0.90, IQR: 2.30), of originator brands (OB) (2.90, IQR: 6.68), and antineoplastic and immunomodulating agents (5.68, IQR: 56.47) were worse than their counterparts. Conclusion: The prices of essential medicine were higher than international level, the overall affordability of essential medicines in China is acceptable but poor in the western region, for OB drugs and anti-cancer medicines. Further national essential medicine policies are needed to reduce regional disparities and improve the affordability of expensive drugs. Systematic Review Registration: https://www.crd.york.ac.uk/PROSPERO/#recordDetails.

Exploring the effectiveness of demand-side retail pharmaceutical expenditure reforms : Cross-country evidence from weighted-average least squares estimation

Increasing expenditures on retail pharmaceuticals bring a critical challenge to the financial stability of healthcare systems worldwide. Policy makers have reacted by introducing a range of measures to control the growth of public pharmaceutical expenditure (PPE). Using panel data on European and non-European OECD member countries from 1990 to 2015, we evaluate the effectiveness of six types of demand-side expenditure control measures including physician-level behaviour measures, system-level price-control measures and substitution measures, alongside a proxy for cost-sharing and add a new dimension to the existing empirical evidence hitherto based on national-level and meta-studies. We use the weighted-average least squares regression framework adapted for estimation with panel-corrected standard errors. Our empirical analysis suggests that direct patient cost-sharing and some-but not all-demand-side measures successfully dampened PPE growth in the past. Cost-sharing schemes stand out as a powerful mechanism to curb PPE growth, but bear a high risk of adverse effects. Other demand-side measures are more limited in effect, though may be more equitable. Due to limitations inherent in the study approach and the data, the results are only explorative.

Implementation of medicines pricing policies in sub-Saharan Africa: systematic review

BACKGROUND

High medicine prices contribute to increasing cost of healthcare worldwide. Many patients with limited resources in sub-Saharan Africa (SSA) are confronted with out-of-pocket charges, constraining their access to medicines. Different medicine pricing policies are implemented to improve affordability and availability; however, evidence on the experiences of implementations of these policies in SSA settings appears limited. Therefore, to bridge this knowledge gap, we reviewed published evidence and answered the question: what are the key determinants of implementation of medicines pricing policies in SSA countries?

METHODS

We identified policies and examined implementation processes, key actors involved, contextual influences on and impact of these policies. We searched five databases and grey literature; screening was done in two stages following clear inclusion criteria. A structured template guided the data extraction, and data analysis followed thematic narrative synthesis. The review followed best practices and reported using PRISMA guidelines.

RESULTS

Of the 5595 studies identified, 31 met the inclusion criteria. The results showed thirteen pricing policies were implemented across SSA between 2003 and 2020. These were in four domains: targeted public subsides, regulatory frameworks and direct price control, generic medicine policies and purchasing policies. Main actors involved were government, wholesalers, manufacturers, retailers, professional bodies, community members and private and public health facilities. Key contextual barriers to implementation were limited awareness about policies, lack of regulatory capacity and lack of price transparency in external reference pricing process. Key facilitators were favourable policy environment on essential medicines, strong political will and international support. Evidence on effectiveness of these policies on reducing prices of, and improving access to, medicines was mixed. Reductions in prices were reported occasionally, and implementation of medicine pricing policy sometimes led to improved availability and affordability to essential medicines.

CONCLUSIONS

Implementation of medicine pricing policies in SSA shows some mixed evidence of improved availability and affordability to essential medicines. It is important to understand country-specific experiences, diversity of policy actors and contextual barriers and facilitators to policy implementation. Our study suggests three policy implications, for SSA and potentially other low-resource settings: avoiding a 'one-size-fits-all' approach, engaging both private and public sector policy actors in policy implementation and continuously monitoring implementation and effects of policies.

SYSTEMATIC REVIEW REGISTRATION

PROSPERO CRD42020178166.

Pharmaceutical policies: effects of regulating drug insurance schemes

BACKGROUND

Drug insurance schemes are systems that provide access to medicines on a prepaid basis and could potentially improve access to essential medicines and reduce out-of-pocket payments for vulnerable populations.

OBJECTIVES

To assess the effects on drug use, drug expenditure, healthcare utilisation and healthcare outcomes of alternative policies for regulating drug insurance schemes.

SEARCH METHODS

We searched CENTRAL, MEDLINE, Embase, nine other databases, and two trials registers between November 2014 and September 2020, including a citation search for included studies on 15 September 2021 using Web of Science. We screened reference lists of all the relevant reports that we retrieved and reports from the Background section. Authors of relevant papers, relevant organisations, and discussion lists were contacted to identify additional studies, including unpublished and ongoing studies.

SELECTION CRITERIA

We planned to include randomised trials, non-randomised trials, interrupted time-series studies (including controlled ITS [CITS] and repeated measures [RM] studies), and controlled before-after (CBA) studies. Two review authors independently assessed the search results and reference lists of relevant reports, retrieved the full text of potentially relevant references and independently applied the inclusion criteria to those studies. We resolved disagreements by discussion, and when necessary by including a third review author. We excluded studies of the following pharmaceutical policies covered in other Cochrane Reviews: those that determined how decisions were made about which conditions or drugs were covered; those that placed restrictions on reimbursement for drugs that were covered; and those that regulated out-of-pocket payments for drugs.

DATA COLLECTION AND ANALYSIS

Two review authors independently extracted data from the included studies and assessed risk of bias for each study, with disagreements being resolved by consensus. We used the criteria suggested by  Cochrane Effective Practice and Organisation of Care (EPOC)  to assess the risk of bias of included studies. For randomised trials, non-randomised trials and controlled before-after studies, we planned to report relative effects. For dichotomous outcomes, we reported the risk ratio (RR) when possible and adjusted for baseline differences in the outcome measures. For interrupted time series and controlled interrupted time-series studies, we computed changes along two dimensions: change in level; and change in slope. We undertook a structured synthesis following the EPOC guidance on this topic, describing the range of effects found in the studies for each category of outcomes.

MAIN RESULTS

We identified 58 studies that met the inclusion criteria (25 interrupted time-series studies and 33 controlled before-after studies). Most of the studies (54) assessed a single policy implemented in the United States (US) healthcare system: Medicare Part D. The other four assessed other drug insurance schemes from Canada and the US, but only one of them provided analysable data for inclusion in the quantitative synthesis. The introduction of drug insurance schemes may increase prescription drug use (low-certainty evidence). On the other hand, Medicare Part D may decrease drug expenditure measured as both out-of-pocket spending and total drug spending (low-certainty evidence). Regarding healthcare utilisation, drug insurance policies (such as Medicare Part D) may lead to a small increase in visits to the emergency department. However, it is uncertain whether this type of policy increases or decreases hospital admissions or outpatient visits by beneficiaries of the scheme because the certainty of the evidence was very low. Likewise, it is uncertain if the policy increases or reduces health outcomes such as mortality because the certainty of the evidence was very low.

AUTHORS' CONCLUSIONS

The introduction of drug insurance schemes such as Medicare Part D in the US health system may increase prescription drug use and may decrease out-of-pocket payments by the beneficiaries of the scheme and total drug expenditures. It may also lead to a small increase in visits to the emergency department by the beneficiaries of the policy. Its effects on other healthcare utilisation outcomes and on health outcomes are uncertain because of the very low certainty of the evidence. The applicability of this evidence to settings outside US healthcare is limited.

How Well Does a Sequential Minimal Optimization Model Perform in Predicting Medicine Prices for Procurement System?

The lack of an efficient approach in managing pharmaceutical prices in the procurement system led to a substantial burden on government budgets. In Thailand, although the reference price policy was implemented to contain the drug expenditure, there have been some challenges with the price dispersion of medicines and pricing information transparency. This phenomenon calls for the development of a potential algorithm to estimate appropriate prices for medical products. To serve this purpose, in this paper, we first developed the model by the sequential minimal optimization (SMO) algorithm for predicting the range of the prices for each medicine, using the Waikato environment for knowledge analysis software, and applying feature selection techniques also to examine improving predictive accuracy. We used the dataset comprised of 2424 records listed on the procurement system in Thailand from January to March 2019 in the application and used a 10-fold cross-validation test to validate the model. The results demonstrated that the model derived by the SMO algorithm with the gain ratio selection method provided good performance at an accuracy of approximately 92.62%, with high sensitivity and precision. Additionally, we found that the model can distinguish the differences in the prices of medicines in the pharmaceutical market by using eight major features—the segmented buyers, the generic product groups, trade product names, procurement methods, dosage forms, pack sizes, manufacturers, and total purchase budgets—that provided the highest predictive accuracy. Our findings are useful to health policymakers who could employ our proposed model in monitoring the situation of medicine prices and providing feedback directly to suggest the best possible price for hospital purchasing managers based on the feature inputs in their procurement system.

Essential Medicines in Universal Health Coverage: A Scoping Review of Public Health Law Interventions and How They Are Measured in Five Middle-Income Countries

Very few studies exist of legal interventions (national laws) for essential medicines as part of universal health coverage in middle-income countries, or how the effect of these laws is measured. This study aims to critically assess whether laws related to universal health coverage use five objectives of public health law to promote medicines affordability and financing, and to understand how access to medicines achieved through these laws is measured. This comparative case study of five middle-income countries (Ecuador, Ghana, Philippines, South Africa, Ukraine) uses a public health law framework to guide the content analysis of national laws and the scoping review of empirical evidence for measuring access to medicines. Sixty laws were included. All countries write into national law: (a) health equity objectives, (b) remedies for users/patients and sanctions for some stakeholders, (c) economic policies and regulatory objectives for financing (except South Africa), pricing, and benefits selection (except South Africa), (d) information dissemination objectives (ex. for medicines prices (except Ghana)), and (e) public health infrastructure. The 17 studies included in the scoping review evaluate laws with economic policy and regulatory objectives (n = 14 articles), health equity (n = 10), information dissemination (n = 3), infrastructure (n = 2), and sanctions (n = 1) (not mutually exclusive). Cross-sectional descriptive designs (n = 8 articles) and time series analyses (n = 5) were the most frequent designs. Change in patients' spending on medicines was the most frequent outcome measure (n = 5). Although legal interventions for pharmaceuticals in middle-income countries commonly use all objectives of public health law, the intended and unintended effects of economic policies and regulation are most frequently investigated.

Medicines with one seller and many buyers: strategies to increase the power of the payer

Andrew Rintoul and colleagues argue that collaboration and transparency increase the market power of buyers who face a monopoly

A Cost Variation Analysis of Drugs Available in the Indian Market for the Management of Thromboembolic Disorders

Introduction

Cardiovascular diseases (CVDs) have become one of the major causes of mortality among the Indian population. The costs of anticoagulant, antiplatelet, and fibrinolytic drugs that are used to treat various thromboembolic disorders and used as prophylactics for individuals at high risk of CVDs vary widely in the Indian pharmaceutical market. The aim of this study was to evaluate the cost variation of different brands of drug formulations and to compare the branded prices of the formulations with their corresponding generic and ceiling prices.

Materials and methods

This study followed an analytical method. Costs of various drugs were obtained from the October - December 2019 edition of the Current Index of Medical Specialities (CIMS) and December 2019 edition of the Monthly Index of Medical Specialities (MIMS) India. Cost ratio and percentage variation in cost per tablet/capsule/injection of different drugs available in the Indian market and manufactured by different pharmaceutical companies were calculated. Comparison of the branded prices with generic and ceiling prices was also performed for different drugs by using information available from official websites.

Results

Percentage variation in cost among the commonly prescribed drugs for the management of thromboembolic disorders was found to be highest for prasugrel 10 mg tablet (1,408.44%) while it was lowest for fondaparinux 2.5 mg / 0.5 ml injection (20%). Among the commonly prescribed drugs that are under Drugs Prices Control Order (DPCO) price control, streptokinase 1.5 MIU injection had the highest cost variation (132.02%) while enoxaparin 60 mg / 0.6 ml injection had the lowest (4.99%). Among some of the important formulations under the Jan Aushadhi scheme (JAS), acenocoumarol 2 mg tablet had the highest cost variation (680.09%) and cilostazol 50 mg tablet had the lowest (55.46%).

Conclusions

Wide differences exist in the costs of various anticoagulants, antiplatelets, and fibrinolytics available in the Indian market. The prescribing physician should be aware of theses variations and prescribe medicines accordingly, keeping in mind the financial status of the patients.

Financial Burden of Prescribed Medicines Included in Outpatient Benefits Package Schemes: Comparative Analysis of Co-Payments for Reimbursable Medicines in European Countries

OBJECTIVE

The study aimed to analyse the financial burden that co-payments for prescribed and reimbursed medicines pose on patients in European countries.

METHODS

Five medicines used in acute conditions (antibiotic, analgesic) and in chronic care (hypertension, asthma, diabetes) were selected. Co-payments (standard and five defined population groups, e.g. low-income people, patients with high consumption) were surveyed based on information retrieved from national price lists (September 2017) and co-payment regulation in nine countries (Albania, Austria, England, France, Germany, Greece, Hungary, Kyrgyzstan and Sweden). The financial burden of the selected medicines (originator and lowest-priced generic) was described as the percentage of patients' payments for 1 month's therapy or treatment of one episode in comparison to the national minimum monthly wage.

RESULTS

The study showed large variation in co-payments between the countries. Financial burden resulting from co-payments for reimbursed medicines tended to be higher in lower-income countries (Kyrgyzstan: 9% of minimum monthly wage for generic amlodipine; 2-4% for generic and originator salbutamol; Albania: approximately 3% for originator amoxicillin/clavulanic acid and metformin). Most studied countries applied reduction or exemption mechanisms (children were exempt in five countries, no or lower co-payments for low-income people in five countries, exemptions from co-payments upon reaching a threshold of expenses in six countries).

CONCLUSIONS

Co-payments for prescribed medicines can pose a substantial financial burden for outpatients, particularly in lower-income countries. The price of a medicine, availability of lower-priced medicines and the design of co-payments, including exemptions and reductions for specific groups, can considerably impact patients' expenses for medicines.

Pharmaceutical policies: effects of educational or regulatory policies targeting prescribers

BACKGROUND

Pharmaceuticals make an important contribution to people's health. Medicines, however, are frequently not used appropriately. Improving the use of medicines can improve health outcomes and save resources. On the other hand, regulatory and educational policies may have unintended effects on health and costs.

OBJECTIVES

To assess the effects of pharmaceutical educational and regulatory policies targeting prescribers on medicine use, healthcare utilisation, health outcomes and costs (expenditures).

SEARCH METHODS

We searched CENTRAL, MEDLINE, Embase, and two trial registries in March 2018 and several other databases between 2014 and 2018. We reviewed the reference lists of included studies and other relevant reviews, contacted authors of relevant reviews and studies to identify additional studies, and did a citation search for all included studies using ISI Web of Science (searched 05 January 2016).

SELECTION CRITERIA

Randomised trials, non-randomised trials, interrupted time series studies, repeated measures studies and controlled before‒after studies of policies regulating who can prescribe medicines and other policies targeted at prescribers. We included in this category monitoring and enforcement of restrictions, generic prescribing, programmes to implement treatment guidelines, system-wide policies regarding monitoring medicine safety, and legislated or mandatory continuing education or quality improvement specifically targeted at prescribing. We defined 'policies' in this review as laws, rules, financial and administrative orders made by governments, non-governmental organisations or private insurers. We excluded interventions applied at the level of a single facility. For us to include a study, it had to include an objective measure of at least one of the following outcomes: medicine use, healthcare utilization, health outcomes, or costs.

DATA COLLECTION AND ANALYSIS

Two review authors independently reviewed abstracts and reference lists of relevant reports, assessed full-text studies for inclusion, extracted data, and assessed risk of bias and certainty of the evidence (GRADE). For all the steps in the above process we resolved disagreements by discussion.

MAIN RESULTS

We identified two studies that met our selection criteria: a controlled interrupted time series study evaluating a regulatory policy involving the monitoring of prescribing of benzodiazepines; and a controlled before‒after study of an educational policing involving mailed educational materials on prescribing for physicians and Health Maintenance Organization (HMO) members as well as an intervention to regulate drug reimbursement. We are uncertain about the effects on medicine use of a regulatory policy involving the monitoring of prescribing with triplicate prescriptions, compared with no regulatory intervention (very low certainty evidence). We are also uncertain about the effects on medicine use, assessed through doctors' prescribing, and costs of an educational policy involving mailed educational materials on prescribing for physicians and HMO members, compared to no educational intervention or an intervention to regulate drug reimbursement (very low certainty evidence). Neither of the included studies measured healthcare utilization, health outcomes, or additional costs, if any, to patients.

AUTHORS' CONCLUSIONS

We are uncertain of the effects of educational or regulatory policies targeting prescribers due to very limited evidence of very low certainty. The impacts of these policies therefore need to be evaluated rigorously using appropriate study designs. Evaluations are needed across a range of settings, including low- and middle-income countries, and across different types of prescribers and medicines.

Affordable and equitable access to subsidised outpatient medicines? Analysis of co-payments under the Additional Drug Package in Kyrgyzstan

BACKGROUND

Out-of-pocket (OOP) payments can constitute a major barrier for affordable and equitable access to essential medicines. Household surveys in Kyrgyzstan pointed to a perceived growth in OOP payments for outpatient medicines, including those covered by the benefits package scheme (the Additional Drug Package, ADP). The study aimed to explore the extent of co-payments for ADP-listed medicines and to explain the reasons for developments.

METHODS

A descriptive statistical analysis was performed on prices and volumes of prescribed ADP-listed medicines dispensed in pharmacies during 2013-2015 (1,041,777 prescriptions claimed, data provided by the Mandatory Health Insurance Fund). Additionally, data on the value and volume of imported medicines in 2013-2015 (obtained from the National Medicines Regulatory Agency) were analysed.

RESULTS

In 2013-2015, co-payments for medicines dispensed under the ADP grew, on average, by 22.8%. Co-payments for ADP-listed medicines amounted to around 50% of a reimbursed baseline price, but as pharmacy retail prices were not regulated, co-payments tended to be higher in practice. The increase in co-payments coincided with a reduction in the number of prescriptions dispensed (by 14%) and an increase in average amounts reimbursed per prescription in nearly all therapeutic groups (by 22%) in the study period. While the decrease in prescriptions suggests possible underuse, as patients might forego filling prescriptions due to financial restraints, the growth in average amounts reimbursed could be an indication of inefficiencies in public funding. Variation between the regions suggests regional inequity. Devaluation of the national currency was observed, and the value of imported medicines increased by nearly 20%, whereas volumes of imports remained at around the same level in 2013-2015. Thus, patients and public procurers had to pay more for the same amount of medicines.

CONCLUSIONS

The findings suggest an increase in pharmacy retail prices as the major driver for higher co-payments. The national currency devaluation contributed to the price increases, and the absence of medicine price regulation aggravated the effects of the depreciation. It is recommended that Kyrgyzstan should introduce medicine price regulation and exemptions for low-income people from co-payments to ensure a more affordable and equitable access to medicines.

How do financial (dis)incentives influence health behaviour and costs? Protocol for a systematic literature review of randomised controlled trials

INTRODUCTION

In this era of rising healthcare costs, there is a growing interest in understanding how funding policies can be used to improve health and healthcare efficiency. Financial incentives (eg, vouchers or access to health insurance) or disincentives (eg, fines or out-of-pocket costs) affect behaviours. To date, reviews have explored the effects of financial (dis)incentives on patient health and behaviour by focusing on specific behaviours or geographical areas. The objective of this systematic review is to provide a comprehensive overview on the use of financial (dis)incentives as a means of influencing health-related behaviour and costs in randomised trials.

METHODS AND ANALYSIS

We will search electronic databases, clinical trial registries and websites of health economic organisations for randomised controlled trials. The initial searches, which were conducted on 13 January 2018, will be updated every 12 months until the completion of data analysis. The reference lists of included studies will be manually screened to identify additional eligible studies. Two researchers will independently review titles, abstracts and full texts to determine eligibility according to a set of predetermined inclusion criteria. Data will be extracted from included studies using a form developed and piloted by the research team. Discrepancies will be resolved through discussion with a third reviewer. Risk of bias will be assessed using the Cochrane Collaboration tool.

ETHICS AND DISSEMINATION

Ethics approval is not required since this is a review of published data. Results will be disseminated through publication in peer-reviewed journals and presentations at relevant conferences.

PROSPERO REGISTRATION NUMBER

CRD42018097140.

Effectiveness of National Pricing Policies for Patent-Protected Pharmaceuticals in the OECD: A Systematic Literature Review

OBJECTIVES

The aim of this review is to assess the current state of empirical research regarding the effectiveness of national pricing regulations of the patent-protected market for prescription pharmaceuticals. Effectiveness is understood to be the capacity of policies to have a desired impact on outcomes, such as health status, patient access, healthcare expenditure, and research investments, among others.

METHODS

A systematic review of the published literature on pricing regulations in OECD countries was performed. The PubMed, MEDLINE, Scopus, Web of Science, Cochrane Library and the OECD iLibrary databases were searched in September 2016 and December 2017, with an update in August 2018. Interrupted time series studies and additional empirical studies were included, as well as systematic reviews if appropriate methods were applied. The risk of bias was assessed based on the recommendations of the BMJ guidelines, Cochrane EPOC criteria, QHES instrument, HTA good practice guidelines, CRD's guidance and the CHEC criteria. The quality of evidence was evaluated using the suggestions from EPOC and GRADE.

RESULTS

Thirty-one publications met the inclusion criteria. Most of the assessed empirical research included therapeutic (TRP) and/or external reference pricing (ERP), with a clear majority focusing on TRP. The main outcomes that were analysed were drug prices, expenditures and drug use. For value-based pricing (VBP), only limited empirical data were found.

CONCLUSIONS

We found evidence that TRP may reduce pharmaceutical prices and expenditures in the short term. Furthermore, TRP may lead to substitution effects towards lower-priced pharmaceuticals. The effects of TRP on patient access, healthcare utilisation and R&D investments were found to be uncertain. No conclusions were drawn for ERP and VBP. No evidence was found for the effects on health outcomes for any of the analysed policies. There is a strong need for evidence generation regarding effective pricing policies, particularly for VBP, managed entry agreements and non-financial outcomes.

Lecture 2-What Is a Formulary, Anyway? (Or the Cliff Notes Version of Drug Stewardship and Expense Control)

A formulary is the product of an evaluative process, the formulary system, conducted by an expert panel that both sanctions and guides the selection, prescription, administration, and monitoring of pharmaceuticals and related items for a given environment. An expert panel, often called the Pharmacy and Therapeutics Committee (P&T), is a group of pharmacists, physicians, nurses, and administrators assembled for the purpose of providing guidance and validation for pharmaceutical utilization in a given organization. Expert panels became prominent because of qualitative and quantitative changes in drug production and marketing strategies employed by industry, the expansion of public health sector medicine, and organized, macro-level drug control systems. It could be argued that, as a clinical instrument, the formulary is predicated on the role pharmacy is perceived to play in actual direct patient care. In this lecture, the concept and defining characteristics of a formulary (the perspective of an expert panel, differences in the environment of application, and interprofessional relationships), the modifiers used to describe a formulary, which modifiers enhance or distract from its meaning, and the outlook for comprehensive and objective evaluation through the formulary mechanism are discussed.

Effects of a price cut reform on the cost and utilization of antidiabetic drugs in Korea: a national health insurance database study

BACKGROUND

Despite the potential widespread application and a significant need, the policy effectiveness of prescribed medications price controls has not been studied extensively. We aimed to explore the effects of a price cut introduced in April 1st of 2012 on the cost and utilization of antidiabetics in South Korea.

METHODS

We identified approximately four million outpatients who filed at least one diabetes-related claim during the index period (January 2010 to December 2012) using the National Health Insurance claims data. We performed interrupted time series analyses for cost and utilization of "overall," "reduced price," and "constant price" antidiabetics between January 2009 and June 2013, and measured the growth rate for incidents of medical and surgical procedures for diabetes-induced complications.

RESULTS

The segmented regression suggests that spending on overall and reduced price antidiabetics would drop by 6 and 23%, respectively; spending on constant price antidiabetics would rise by 16% in a year after the new pricing compared to if the policy were not in existence. There were a few immediate changes in utilization, and its trend indicated a significant decrease in reduced price antidiabetics and an increase in constant price antidiabetics. Incidents of medical and surgical procedures relating to diabetic complications were unaffected.

CONCLUSIONS

The Korean price cut program contained costs by immediately reducing the cost of pharmaceuticals without any major signals associated with compromised clinical conditions in diabetic patients.

What is in your wallet? A cluster randomized trial of the effects of showing comparative patient out-of-pocket costs on primary care prescribing for uncomplicated hypertension

BACKGROUND

Drug expenditures are responsible for an increasing proportion of health costs, accounting for $1.1 trillion in annual expenditure worldwide. As hundreds of billions of dollars are being spent each year on overtreatment with prescribed medications that are either unnecessary or are in excess of lowest cost-effective therapy, programs are needed that optimize fiscally appropriate use. We evaluated whether providing physicians with information on the patient out-of-pocket payment consequences of prescribing decisions that were in excess of lowest cost-effective therapy would alter prescribing decisions using the treatment of uncomplicated hypertension as an exemplar.

METHODS

A single-blind cluster randomized trial was conducted over a 60-month follow-up period in 76 primary care physicians in Quebec, Canada, and their patients with uncomplicated hypertension who were using the MOXXI integrated electronic health record for drug and health problem management. Physicians were randomized to an out-of-pocket expenditure module that provided alerts for comparative out-of-payment costs, thiazide diuretics as recommended first-line therapy, and tools to monitor blood pressure targets and medication compliance, or alternatively the basic MOXXI system. System software and prescription claims were used to analyze the impact of the intervention on treatment choice, adherence, and overall and out-of-pocket payment costs using generalized estimating equations.

RESULTS

Three thousand five-hundred ninety-two eligible patients with uncomplicated hypertension were enrolled, of whom 1261 (35.1%) were newly started (incident patient) on treatment during follow-up. There was a statistically significant increase in the prescription of diuretics in the newly treated intervention (26.6%) compared to control patients (19.8%) (RR 1.65, 95% CI 1.17 to 2.33). For patients already treated (prevalent patient), there was a statistically significant interaction between the intervention and patient age, with older patients being less likely to be switched to a diuretic. Among the incident patients, physicians with less than 15 years of experience were much more likely to prescribe a diuretic (OR 10.69; 95% CI 1.49 to 76.64) than physicians with 15 to 25 years (OR 0.67; 95%CI 0.25 to 1.78), or more than 25 years of experience (OR 1.80; 95% CI 1.23 to 2.65). There was no statistically significant effect of the intervention on adherence or out-of-pocket payment cost.

CONCLUSIONS

The provision of comparative information on patient out-of-pocket payments for treatment of uncomplicated hypertension had a statistically significant impact on increasing the initiation of diuretics in incident patients and switching to diuretics in younger prevalent patients. The impact of interventions to improve the cost-effectiveness of prescribing may be enhanced by also targeting patients with tools to participate in treatment decision-making and by providing physicians with comparative out-of-pocket information on all evidence-based alternatives that would enhance clinical decision-making.

TRIAL REGISTRATION

ISRCTN96253624.

Characteristics and healthcare utilisation patterns of high-cost beneficiaries in the Netherlands: a cross-sectional claims database study

OBJECTIVE

To determine medical needs, demographic characteristics and healthcare utilisation patterns of the top 1% and top 2%-5% high-cost beneficiaries in the Netherlands.

DESIGN

Cross-sectional study using 1 year claims data. We broke down high-cost beneficiaries by demographics, the most cost-incurring condition per beneficiary and expensive treatment use.

SETTING

Dutch curative health system, a health system with universal coverage.

PARTICIPANTS

4.5 million beneficiaries of one health insurer.

MEASURES

Annual total costs through hospital, intensive care unit use, expensive drugs, other pharmaceuticals, mental care and others; demographics; most cost-incurring and secondary conditions; inpatient stay; number of morbidities; costs per ICD10-chapter (International Statistical Classification of Diseases, 10th revision); and expensive treatment use (including dialysis, transplant surgery, expensive drugs, intensive care unit and diagnosis-related groups >€30 000).

RESULTS

The top 1% and top 2%-5% beneficiaries accounted for 23% and 26% of total expenditures, respectively. Among top 1% beneficiaries, hospital care represented 76% of spending, of which, respectively, 9.0% and 9.1% were spent on expensive drugs and ICU care. We found that 54% of top 1% beneficiaries were aged 65 years or younger and that average costs sharply decreased with higher age within the top 1% group. Expensive treatments contributed to high costs in one-third of top 1% beneficiaries and in less than 10% of top 2%-5% beneficiaries. The average number of conditions was 5.5 and 4.0 for top 1% and top 2%-5% beneficiaries, respectively. 53% of top 1% beneficiaries were treated for circulatory disorders but for only 22% of top 1% beneficiaries this was their most cost-incurring condition.

CONCLUSIONS

Expensive treatments, most cost-incurring condition and age proved to be informative variables for studying this heterogeneous population. Expensive treatments play a substantial role in high-costs beneficiaries. Interventions need to be aimed at beneficiaries of all ages; a sole focus on the elderly would leave many high-cost beneficiaries unaddressed. Tailored interventions are needed to meet the needs of high-cost beneficiaries and to avoid waste of scarce resources.

Governance arrangements for health systems in low-income countries: an overview of systematic reviews

BACKGROUND

Governance arrangements include changes in rules or processes that determine authority and accountability for health policies, organisations, commercial products and health professionals, as well as the involvement of stakeholders in decision-making. Changes in governance arrangements can affect health and related goals in numerous ways, generally through changes in authority, accountability, openness, participation and coherence. A broad overview of the findings of systematic reviews can help policymakers, their technical support staff and other stakeholders to identify strategies for addressing problems and improving the governance of their health systems.

OBJECTIVES

To provide an overview of the available evidence from up-to-date systematic reviews about the effects of governance arrangements for health systems in low-income countries. Secondary objectives include identifying needs and priorities for future evaluations and systematic reviews on governance arrangements and informing refinements of the framework for governance arrangements outlined in the overview.

METHODS

We searched Health Systems Evidence in November 2010 and PDQ Evidence up to 17 December 2016 for systematic reviews. We did not apply any date, language or publication status limitations in the searches. We included well-conducted systematic reviews of studies that assessed the effects of governance arrangements on patient outcomes (health and health behaviours), the quality or utilisation of healthcare services, resource use (health expenditures, healthcare provider costs, out-of-pocket payments, cost-effectiveness), healthcare provider outcomes (such as sick leave), or social outcomes (such as poverty, employment) and that were published after April 2005. We excluded reviews with limitations that were important enough to compromise the reliability of the findings of the review. Two overview authors independently screened reviews, extracted data and assessed the certainty of evidence using GRADE. We prepared SUPPORT Summaries for eligible reviews, including key messages, 'Summary of findings' tables (using GRADE to assess the certainty of the evidence) and assessments of the relevance of findings to low-income countries.

MAIN RESULTS

We identified 7272 systematic reviews and included 21 of them in this overview (19 primary reviews and 2 supplementary reviews). We focus here on the results of the 19 primary reviews, one of which had important methodological limitations. The other 18 were reliable (with only minor limitations).We grouped the governance arrangements addressed in the reviews into five categories: authority and accountability for health policies (three reviews); authority and accountability for organisations (two reviews); authority and accountability for commercial products (three reviews); authority and accountability for health professionals (seven reviews); and stakeholder involvement (four reviews).Overall, we found desirable effects for the following interventions on at least one outcome, with moderate- or high-certainty evidence and no moderate- or high-certainty evidence of undesirable effects. Decision-making about what is covered by health insurance- Placing restrictions on the medicines reimbursed by health insurance systems probably decreases the use of and spending on these medicines (moderate-certainty evidence). Stakeholder participation in policy and organisational decisions- Participatory learning and action groups for women probably improve newborn survival (moderate-certainty evidence).- Consumer involvement in preparing patient information probably improves the quality of the information and patient knowledge (moderate-certainty evidence). Disclosing performance information to patients and the public- Disclosing performance data on hospital quality to the public probably encourages hospitals to implement quality improvement activities (moderate-certainty evidence).- Disclosing performance data on individual healthcare providers to the public probably leads people to select providers that have better quality ratings (moderate-certainty evidence).

AUTHORS' CONCLUSIONS

Investigators have evaluated a wide range of governance arrangements that are relevant for low-income countries using sound systematic review methods. These strategies have been targeted at different levels in health systems, and studies have assessed a range of outcomes. Moderate-certainty evidence shows desirable effects (with no undesirable effects) for some interventions. However, there are important gaps in the availability of systematic reviews and primary studies for the all of the main categories of governance arrangements.

Financial arrangements for health systems in low-income countries: an overview of systematic reviews

BACKGROUND

One target of the Sustainable Development Goals is to achieve "universal health coverage, including financial risk protection, access to quality essential health-care services and access to safe, effective, quality and affordable essential medicines and vaccines for all". A fundamental concern of governments in striving for this goal is how to finance such a health system. This concern is very relevant for low-income countries.

OBJECTIVES

To provide an overview of the evidence from up-to-date systematic reviews about the effects of financial arrangements for health systems in low-income countries. Secondary objectives include identifying needs and priorities for future evaluations and systematic reviews on financial arrangements, and informing refinements in the framework for financial arrangements presented in the overview.

METHODS

We searched Health Systems Evidence in November 2010 and PDQ-Evidence up to 17 December 2016 for systematic reviews. We did not apply any date, language, or publication status limitations in the searches. We included well-conducted systematic reviews of studies that assessed the effects of financial arrangements on patient outcomes (health and health behaviours), the quality or utilisation of healthcare services, resource use, healthcare provider outcomes (such as sick leave), or social outcomes (such as poverty, employment, or financial burden of patients, e.g. out-of-pocket payment, catastrophic disease expenditure) and that were published after April 2005. We excluded reviews with limitations important enough to compromise the reliability of the findings. Two overview authors independently screened reviews, extracted data, and assessed the certainty of evidence using GRADE. We prepared SUPPORT Summaries for eligible reviews, including key messages, 'Summary of findings' tables (using GRADE to assess the certainty of the evidence), and assessments of the relevance of findings to low-income countries.

MAIN RESULTS

We identified 7272 reviews and included 15 in this overview, on: collection of funds (2 reviews), insurance schemes (1 review), purchasing of services (1 review), recipient incentives (6 reviews), and provider incentives (5 reviews). The reviews were published between 2008 and 2015; focused on 13 subcategories; and reported results from 276 studies: 115 (42%) randomised trials, 11 (4%) non-randomised trials, 23 (8%) controlled before-after studies, 51 (19%) interrupted time series, 9 (3%) repeated measures, and 67 (24%) other non-randomised studies. Forty-three per cent (119/276) of the studies included in the reviews took place in low- and middle-income countries. Collection of funds: the effects of changes in user fees on utilisation and equity are uncertain (very low-certainty evidence). It is also uncertain whether aid delivered under the Paris Principles (ownership, alignment, harmonisation, managing for results, and mutual accountability) improves health outcomes compared to aid delivered without conforming to those principles (very low-certainty evidence). Insurance schemes: community-based health insurance may increase service utilisation (low-certainty evidence), but the effects on health outcomes are uncertain (very low-certainty evidence). It is uncertain whether social health insurance improves utilisation of health services or health outcomes (very low-certainty evidence). Purchasing of services: it is uncertain whether increasing salaries of public sector healthcare workers improves the quantity or quality of their work (very low-certainty evidence). Recipient incentives: recipient incentives may improve adherence to long-term treatments (low-certainty evidence), but it is uncertain whether they improve patient outcomes. One-time recipient incentives probably improve patient return for start or continuation of treatment (moderate-certainty evidence) and may improve return for tuberculosis test readings (low-certainty evidence). However, incentives may not improve completion of tuberculosis prophylaxis, and it is uncertain whether they improve completion of treatment for active tuberculosis. Conditional cash transfer programmes probably lead to an increase in service utilisation (moderate-certainty evidence), but their effects on health outcomes are uncertain. Vouchers may improve health service utilisation (low-certainty evidence), but the effects on health outcomes are uncertain (very low-certainty evidence). Introducing a restrictive cap may decrease use of medicines for symptomatic conditions and overall use of medicines, may decrease insurers' expenditures on medicines (low-certainty evidence), and has uncertain effects on emergency department use, hospitalisations, and use of outpatient care (very low-certainty evidence). Reference pricing, maximum pricing, and index pricing for drugs have mixed effects on drug expenditures by patients and insurers as well as the use of brand and generic drugs. Provider incentives: the effects of provider incentives are uncertain (very low-certainty evidence), including: the effects of provider incentives on the quality of care provided by primary care physicians or outpatient referrals from primary to secondary care, incentives for recruiting and retaining health professionals to serve in remote areas, and the effects of pay-for-performance on provider performance, the utilisation of services, patient outcomes, or resource use in low-income countries.

AUTHORS' CONCLUSIONS

Research based on sound systematic review methods has evaluated numerous financial arrangements relevant to low-income countries, targeting different levels of the health systems and assessing diverse outcomes. However, included reviews rarely reported social outcomes, resource use, equity impacts, or undesirable effects. We also identified gaps in primary research because of uncertainty about applicability of the evidence to low-income countries. Financial arrangements for which the effects are uncertain include external funding (aid), caps and co-payments, pay-for-performance, and provider incentives. Further studies evaluating the effects of these arrangements are needed in low-income countries. Systematic reviews should include all outcomes that are relevant to decision-makers and to people affected by changes in financial arrangements.

Comparing Generic Drug Markets in Europe and the United States: Prices, Volumes, and Spending

Policy Points: Our study indicates that there are opportunities for cost savings in generic drug markets in Europe and the United States. Regulators should make it easier for generic drugs to reach the market. Regulators and payers should apply measures to stimulate price competition among generic drugmakers and to increase generic drug use. To meaningfully evaluate policy options, it is important to analyze historical context and understand why similar initiatives failed previously.

CONTEXT

Rising drug prices are putting pressure on health care budgets. Policymakers are assessing how they can save money through generic drugs.

METHODS

We compared generic drug prices and market shares in 13 European countries, using data from 2013, to assess the amount of variation that exists between countries. To place these results in context, we reviewed evidence from recent studies on the prices and use of generics in Europe and the United States. We also surveyed peer-reviewed studies, gray literature, and books published since 2000 to (1) outline existing generic drug policies in European countries and the United States; (2) identify ways to increase generic drug use and to promote price competition among generic drug companies; and (3) explore barriers to implementing reform of generic drug policies, using a historical example from the United States as a case study.

FINDINGS

The prices and market shares of generics vary widely across Europe. For example, prices charged by manufacturers in Switzerland are, on average, more than 2.5 times those in Germany and more than 6 times those in the United Kingdom, based on the results of a commonly used price index. The proportion of prescriptions filled with generics ranges from 17% in Switzerland to 83% in the United Kingdom. By comparison, the United States has historically had low generic drug prices and high rates of generic drug use (84% in 2013), but has in recent years experienced sharp price increases for some off-patent products. There are policy solutions to address issues in Europe and the United States, such as streamlining the generic drug approval process and requiring generic prescribing and substitution where such policies are not yet in place. The history of substitution laws in the United States provides insights into the economic, political, and cultural issues influencing the adoption of generic drug policies.

CONCLUSIONS

Governments should apply coherent supply- and demand-side policies in generic drug markets. An immediate priority is to convince more physicians, pharmacists, and patients that generic drugs are bioequivalent to branded products. Special-interest groups continue to obstruct reform in Europe and the United States.

Association of Reference Pricing with Drug Selection and Spending

Background In the United States, prices for therapeutically similar drugs vary widely, which has prompted efforts by public and private insurers to steer patients toward the lower-priced options. Under reference pricing, the insurer or employer establishes a maximum contribution it will make toward the price of a drug or procedure, and the patient pays the remainder. Methods We used difference-in-differences multivariable regression methods to analyze changes in prescriptions and pricing for 1302 drugs in 78 therapeutic classes in the United States, before and after implementation of reference pricing by an alliance of private employers. We assessed trends for the study group relative to those for an employee group that was not subject to reference pricing. The study included 1,122,741 prescriptions that were reimbursed during the period from 2010 through 2014. Results Implementation of reference pricing was associated with a higher percentage of prescriptions that were filled for the lowest-priced reference drug within its therapeutic class (difference in probability, 7.0 percentage points; 95% confidence interval [CI], 4.0 to 9.9), a lower average price paid per prescription (-13.9%; 95% CI, -23.8 to -2.7), and a higher rate of copayment by patients (5.2%; 95% CI, 0.2 to 10.4) than in the comparison group. During the first 18 months after implementation, spending for employers was $1.34 million lower and the amount of copayments for employees was $0.12 million higher than in the comparison group. Conclusions Implementation of reference pricing was associated with significant changes in drug selection and spending for a population of patients covered by employment-based insurance in the United States. (Funded by the Agency for Healthcare Research and Quality and the Genentech Foundation.).

Addressing the challenge of high-priced prescription drugs in the era of precision medicine: A systematic review of drug life cycles, therapeutic drug markets and regulatory frameworks

CONTEXT

Recent public outcry has highlighted the rising cost of prescription drugs worldwide, which in several disease areas outpaces other health care expenditures and results in a suboptimal global availability of essential medicines.

METHOD

A systematic review of Pubmed, the Financial Times, the New York Times, the Wall Street Journal and the Guardian was performed to identify articles related to the pricing of medicines.

FINDINGS

Changes in drug life cycles have dramatically affected patent medicine markets, which have long been considered a self-evident and self-sustainable source of income for highly profitable drug companies. Market failure in combination with high merger and acquisition activity in the sector have allowed price increases for even off-patent drugs. With market interventions and the introduction of QALY measures in health care, governments have tried to influence drug prices, but often encounter unintended consequences. Patent reform legislation, reference pricing, outcome-based pricing and incentivizing physicians and pharmacists to prescribe low-cost drugs are among the most promising short-term policy options. Due to the lack of systematic research on the effectiveness of policy measures, an increasing number of ad hoc decisions have been made with counterproductive effects on the availability of essential drugs. Future challenges demand new policies, for which recommendations are offered.

CONCLUSION

A fertile ground for high-priced drugs has been created by changes in drug life-cycle dynamics, the unintended effects of patent legislation, government policy measures and orphan drug programs. There is an urgent need for regulatory reform to curtail prices and safeguard equitable access to innovative medicines.

Reference Pricing with Endogenous or Exogenous Payment Limits: Impacts on Insurer and Consumer Spending

Reference pricing (RP) theories predict different outcomes when reference prices are fixed (exogenous) versus being a function of market prices (MPs) (endogenous). Exogenous RP results in MPs at both high-price and low-price firms converging towards the reference price from above and below, respectively. Endogenous RP results in MPs at both high-price and low-price firms decreasing, with low-price firms acting strategically to decrease the reference price in order to gain market share. We extend these models to a hospital context focusing on insurer and consumer payments. Under exogenous RP, insurer and consumer payments to low-price hospitals increase, and insurer payments to high-price hospitals decrease, but predictions regarding consumer payments are ambiguous for high-price hospitals. Under endogenous RP, insurer payments to high-price and low-price hospitals decrease, and consumer payments to low-price hospitals decrease, but predictions regarding consumer payments are ambiguous for high-price hospitals. We test these predictions with difference-in-differences specifications using 2008-2013 data on patients undergoing joint replacement. For 2 years following RP implementation, insurer payments to high-price and low-price hospitals moved downward, consistent with endogenous RP. However, when the reference price was not reset to account for changes in MPs, insurer payments to low-price hospitals reverted to pre-implementation levels, consistent with exogenous RP. Copyright © 2015 John Wiley & Sons, Ltd.

Bias within economic evaluations - the impact of considering the future entry of lower-cost generics on currently estimated incremental cost-effectiveness ratios of a new drug

Background

Most economic evaluation models compare a new patented drug (NPRx) to a generic comparator. Drug costs within these models are usually limited to the retail cost of both drugs at the time of model conception. However, the retail cost of the NPRx is expected to drop once generic versions of this molecule are introduced following the expiration of the NPRx’s patent. The objective of this study was to examine the impact on the incremental cost-effectiveness ratio (ICER) of the future introduction of lower-cost generic versions of the NPRx within the model’s time horizon.

Methods

We examined the impact of this parameter with the use of two approaches: 1) a mathematical proof identifying its impact on the NPRx’s ICER; and 2) applying this parameter to a previously published economic model comparing a NPRx to a generic comparator and identifying what would have been the NPRx’s ICER had this model considered this parameter.

Results

As expected, both the mathematical proof and the application to the previously published economic model showed that considering the future introduction of lower-cost generic versions of the NPRx within the model’s time horizon lowers the NPRx’s ICER. The timing of the future entry of lower-cost generic molecules, their relative price compared to that of the patented version, and the discount rate applied to future costs all influenced the results.

Conclusion

An ICER estimated within economic evaluations comparing NPRx to generic comparators which ignore the future introduction of lower-cost generic versions of the NPRx within the model’s time horizon will tend to be overestimated. Inclusion of this parameter should be considered within future economic evaluations.

Pharmaceutical policies: effects of financial incentives for prescribers

BACKGROUND

The proportion of total healthcare expenditures spent on drugs has continued to grow in countries of all income categories. Policy-makers are under pressure to control pharmaceutical expenditures without adversely affecting quality of care. Financial incentives seeking to influence prescribers' behaviour include budgetary arrangements at primary care and hospital settings (pharmaceutical budget caps or targets), financial rewards for target behaviours or outcomes (pay for performance interventions) and reduced benefit margin for prescribers based on medicine sales and prescriptions (pharmaceutical reimbursement rate reduction policies). This is the first update of the original version of this review.

OBJECTIVES

To determine the effects of pharmaceutical policies using financial incentives to influence prescribers' practices on drug use, healthcare utilisation, health outcomes and costs (expenditures).

SEARCH METHODS

We searched the Cochrane Central Register of Controlled Trials (CENTRAL) (searched 29/01/2015); MEDLINE, Ovid SP (searched 29/01/2015); EMBASE, Ovid SP (searched 29/01/2015); International Network for Rational Use of Drugs (INRUD) Bibliography (searched 29/01/2015); National Health Service (NHS) Economic Evaluation Database (searched 29/01/2015); EconLit - ProQuest (searched 02/02/2015); and Science Citation Index and Social Sciences Citation Index, Institute for Scientific Information (ISI) Web of Knowledge (citation search for included studies searched 10/02/2015). We screened the reference lists of relevant reports and contacted study authors and organisations to identify additional studies.

SELECTION CRITERIA

We included policies that intend to affect prescribing by means of financial incentives for prescribers. Included in this category are pharmaceutical budget caps or targets, pay for performance and drug reimbursement rate reductions and other financial policies, if they were specifically targeted at prescribing or drug utilisation. Policies in this review were defined as laws, rules, regulations and financial and administrative orders made or implemented by payers such as national or local governments, non-government organisations, private or social insurers and insurance-like organisations. One of the following outcomes had to be reported: drug use, healthcare utilisation, health outcomes or costs. The study had to be a randomised or non-randomised trial, an interrupted time series (ITS) analysis, a repeated measures study or a controlled before-after (CBA) study.

DATA COLLECTION AND ANALYSIS

At least two review authors independently assessed eligibility for inclusion of studies and risks of bias using Cochrane Effective Practice and Organisation of Care (EPOC) criteria and extracted data from the included studies. For CBA studies, we reported relative effects (e.g. adjusted relative change). The review team re-analysed all ITS results. When possible, the review team also re-analysed CBA data as ITS data.

MAIN RESULTS

Eighteen evaluations (six new studies) of pharmaceutical policies from six high-income countries met our inclusion criteria. Fourteen studies evaluated pharmaceutical budget policies in the UK (nine studies), two in Germany and Ireland and one each in Sweden and Taiwan. Three studies assessed pay for performance policies in the UK (two) and the Netherlands (one). One study from Taiwan assessed a reimbursement rate reduction policy. ITS analyses had some limitations. All CBA studies had serious limitations. No study from low-income or middle-income countries met the inclusion criteria.Pharmaceutical budgets may lead to a modest reduction in drug use (median relative change -2.8%; low-certainty evidence). We are uncertain of the effects of the policy on drug costs or healthcare utilisation, as the certainty of such evidence has been assessed as very low. Effects of this policy on health outcomes were not reported. Effects of pay for performance policies on drug use and health outcomes are uncertain, as the certainty of such evidence has been assessed as very low. Effects of this policy on drug costs and healthcare utilisation have not been measured. Effects of the reimbursement rate reduction policy on drug use and drug costs are uncertain, as the certainty of such evidence has been assessed as very low. No included study assessed the effects of this policy on healthcare utilisation or health outcomes. Administration costs of the policies were not reported in any of the included studies.

AUTHORS' CONCLUSIONS

Although financial incentives are considered an important element in strategies to change prescribing patterns, limited evidence of their effects can be found. Effects of policies, including pay for performance policies, in improving quality of care and health outcomes remain uncertain. Because pharmaceutical policies have uncertain effects, and because they might cause harm as well as benefit, proper evaluation of these policies is needed. Future studies should consider the impact of these policies on health outcomes, drug use and overall healthcare expenditures, as well as on drug expenditures.