Measuring the Value of Pharmaceuticals in the US Health System

Defining 'therapeutic value' of medicines: a scoping review

OBJECTIVES

In recent years, discussions on the importance and scope of therapeutic value of new medicines have intensified, stimulated by the increase of prices and number of medicines entering the market. This study aims to perform a scoping review identifying factors contributing to the definition of the therapeutic value of medicines.

DESIGN

Scoping review.

DATA SOURCES

We searched the MEDLINE, CINAHL, Embase, Business Source Premier, EconLit, Regional Business News, Cochrane, Web of Science, Scope and Pool databases through December 2020 in English, German, French, Italian and Spanish.

ELIGIBILITY CRITERIA

Studies that included determinants for the definition of therapeutic value of medicines were included.

DATA EXTRACTION AND SYNTHESIS

Data were extracted using the mentioned data sources. Two reviewers independently screened and analysed the articles. Data were analysed from April 2021 to May 2022.

RESULTS

Of the 1883 studies screened, 51 were selected and the identified factors contributing to the definition of therapeutic value of medicines were classified in three categories: patient perspective, public health perspective and socioeconomic perspective. More than three-quarters of the included studies were published after 2014, with the majority of the studies focusing on either cancer disorders (14 of 51, 27.5%) or rare diseases (11 of 51, 21.6%). Frequently mentioned determinants for value were quality of life, therapeutic alternatives and side effects (all patient perspective), prevalence/incidence and clinical endpoints (all public health perspective), and costs (socioeconomic perspective).

CONCLUSIONS

Multiple determinants have been developed to define the therapeutic value of medicines, most of them focusing on cancer disorders and rare diseases. Considering the relevance of value of medicines to guide patients and physicians in decision-making as well as policymakers in resource allocation decisions, a development of evidence-based factors for the definition of therapeutic value of medicines is needed across all therapeutic areas.

Value-Based Pricing Alternatives for Personalised Drugs: Implications of Asymmetric Information and Competition

The market for new drugs is changing: personalised drugs will increase the heterogeneity in patients' responses and, possibly, costs. In this context, price regulation will play an increasingly important role. In this article, we argue that personalised medicine opens new scenarios in the relationship between value-based prices, regulation and industry listing strategies. Our focus is on the role of asymmetry of information and competition. We show that, if the firm has more information than the payer on the heterogeneity in patients' responses and it adopts a profit-maximising listing strategy, the outcome may be independent of the choice of the type of value-based price. In this case, the information advantage that the manufacturer has prevents the payer from using marginal value-based prices to extract part of the surplus. However, in a dynamic setting where competition by a new entrant is possible, the choice of the type of value-based price may matter. We suggest that more research should be devoted to the dynamic analysis of price regulation for personalised medicines.

Spending on Antineoplastic Agents in the United States, 2011 to 2016

PURPOSE:

Recent cancer drug approvals are lauded as being more effective with relatively fewer adverse effects, but these treatments come with a great cost to the US health care system. There is little information on recent trends in actual antineoplastic expenditures representative of the whole US health care system or by sector. Therefore, the objective of this study was to describe antineoplastic expenditures in the United States by year and sector.

METHODS:

This was a retrospective, cross-sectional study of IQVIA (formerly QuintilesIMS) National Sales Perspective data for the period of January 1, 2011, to December 31, 2016. Actual expenditures were totaled by health care sector and calendar year, then adjusted for medical-cost inflation to 2016 dollars. Growth was calculated as the percentage increase from the previous year.

RESULTS:

Total expenditures of antineoplastic agents across all channels grew from $26.8 billion in 2011 to $42.1 billion in 2016. Antineoplastic spending increased 12.2% in 2016 (compared with the previous year), followed by 15.6% in 2015, 13.4% in 2014, 6.3% in 2013, and 0.4% in 2012. Throughout the study period, 96.5% of total antineoplastic expenditures occurred within clinics, mail-order pharmacies, nonfederal hospitals, and retail pharmacies.

CONCLUSION:

Antineoplastic expenditures are expected to increase because of continuing development and approval of costly targeted cancer therapies. Cost containment and utilization management strategies must be balanced so as not to restrict access or disrupt innovation. Future policies should focus on ensuring safe and appropriate use of antineoplastics while balancing long-term drug costs.

Pharmaceutical Pricing in Germany: How Is Value Determined within the Scope of AMNOG?

OBJECTIVES

To analyze how value is determined within the scope of the German Pharmaceutical Restructuring Act, which came into effect in 2011.

METHODS

Using data from all pharmaceuticals that had undergone assessment, appraisal, and price negotiations in Germany before June 30, 2016, we applied generalized linear model regression to analyze the impact of added benefit on the difference between negotiated prices and the prices of comparators. Data were extracted from the Federal Joint Committee's appraisals and price databases. We specified added benefit in various ways. In all models, we controlled for additional criteria such as size of patient population, European price levels, and whether the comparators were generic.

RESULTS

Our regression results confirmed the descriptive results, with price premiums reflecting the extent of added benefit as appraised by the Federal Joint Committee. On the substance level, an added benefit was associated with an increase in price premium of 227.2% (P < 0.001) compared with no added benefit. Moreover, we saw increases in price premium of 377.5% (P < 0.001), 90.0% (P < 0.001), and 336.8% (P < 0.001) for added benefits that were "considerable," "minor," and "not quantifiable," respectively. Beneficial effects on mortality were associated with the greatest price premium (624.3%; P < 0.001), followed by such effects on morbidity (174.7%; P < 0.001) and adverse events (93.1%; P = 0.019).

CONCLUSIONS

Price premiums, or "value," are driven by health gain, the share of patients benefiting from a pharmaceutical, European price levels, and whether comparators are generic. No statement can be made, however, about the appropriateness of the level of price premiums.