Stakeholder preferences about policy objectives and measures of pharmaceutical pricing and reimbursement

Impact of changes in the methodology of external price referencing on medicine prices: discrete-event simulation

BACKGROUND

Several governments apply the policy of external price referencing (EPR), which considers the prices of a medicine in one or more other countries for the purpose of setting the price in the own country. Different methodological choices can be taken to design EPR. The study aimed to analyse whether, or not, and how changes in the methodology of EPR can impact medicine prices.

METHODS

The real-life EPR methodology as of Q1/2015 was surveyed in all European Union Member States (where applicable), Iceland, Norway and Switzerland through a questionnaire responded by national pricing authorities. Different scenarios were developed related to the parameters of the EPR methodology. Discrete-event simulations of fictitious prices in the 28 countries of the study that had EPR were run over 10 years. The continuation of the real-life EPR methodology in the countries as surveyed in 2015, without any change, served as base case.

RESULTS

In most scenarios, after 10 years, medicine prices in all or most surveyed countries were-sometimes considerably-lower than in the base case scenario. But in a few scenarios medicine prices increased in some countries. Consideration of discounts (an assumed 20% discount in five large economies and the mandatory discount in Germany, Greece and Ireland) and determining the reference price based on the lowest price in the country basket would result in higher price reductions (on average - 47.2% and - 34.2% compared to the base case). An adjustment of medicine price data of the reference countries by purchasing power parities would lead to higher prices in some more affluent countries (e.g. Switzerland, Norway) and lower prices in lower-income economies (Bulgaria, Romania, Hungary, Poland). Regular price revisions and changes in the basket of reference countries would also impact medicine prices, however to a lesser extent.

CONCLUSIONS

EPR has some potential for cost-containment. Medicine prices could be decreased if certain parameters of the EPR methodology were changed. If public payers aim to apply EPR to keep medicine prices at more affordable levels, they are encouraged to explore the cost-containment potential of this policy by taking appropriate methodological choices in the EPR design.

External Reference Pricing for Pharmaceuticals-A Survey and Literature Review to Describe Best Practices for Countries With Expanding Healthcare Coverage

BACKGROUND

Countries with expanding healthcare coverage (CEHCs) increasingly use external reference pricing (ERP) for pharmaceuticals. The ERP policies must aim to optimize efficiency, minimize disturbances, and maximize access to effective therapies for all patients.

OBJECTIVE

This research aims to deduce best practices for prudent ERP regulations from past experiences and currently applied policies and to guide policymakers in CEHCs in implementing robust ERP policies.

METHODS

The literature was reviewed for methods and effects of ERP for pharmaceuticals. Pharmaceutical pricing experts from Asia, the Middle East, Russia, and South Africa were surveyed for current approaches to ERP in their respective countries.

RESULTS

Key determinants of ERP relate to scope, number, and choice of reference countries; price definitions; computation rules; frequency; and stringency of applying ERP. The scarce evidence shows that ERP seems to lead to narrower price windows with the risk of reducing prices in high-price countries and raising prices in low-price countries. Moreover, launch delays and indirect price effects are often observed. The ERP policies in CEHCs are often applied in isolation, not always in a consistent and transparent manner, neglecting its indirect effects.

CONCLUSION

Policymakers should consider a set of requirements when introducing ERP, including clear definitions and decision criteria in full transparency. External reference pricing should inform and serve as a benchmark for pricing decisions, rather than being used as the sole pricing mechanism. External reference pricing is primarily a tool to support decisions regarding on-patent pharmaceuticals, and for off-patent products, competition may prove more effective in reducing prices than ERP.

Multi-criteria decision analysis for health technology assessment: addressing methodological challenges to improve the state of the art

BACKGROUND

Multi-criteria decision analysis (MCDA) concepts, models and tools have been used increasingly in health technology assessment (HTA), with several studies pointing out practical and theoretical issues related to its use. This study provides a critical review of published studies on MCDA in the context of HTA by assessing their methodological quality and summarising methodological challenges.

METHODS

A systematic review was conducted to identify studies discussing, developing or reviewing the use of MCDA in HTA using aggregation approaches. Studies were classified according to publication time and type, country of study, technology type and study type. The PROACTIVE-S approach was constructed and used to analyse methodological quality. Challenges and limitations reported in eligible studies were collected and summarised; this was followed by a critical discussion on research requirements to address the identified challenges.

RESULTS

129 journal articles were eligible for review, 56% of which were published in 2015-2017; 42% focused on pharmaceuticals; 36, 26 and 18% reported model applications, issues regarding MCDA implementation analyses, and proposing frameworks, respectively. Poor compliance with good methodological practice (< 25% complying studies) was found regarding behavioural analyses, discussion of model assumptions and uncertainties, modelling of value functions, and dealing with judgment inconsistencies. The five most reported challenges related to evidence and data synthesis; value system differences and participant selection issues; participant difficulties; methodological complexity and resource balance; and criteria and attributes modelling. A critical discussion on ways to address these challenges ensues.

DISCUSSION

Results highlight the need for advancement in robust methodologies, procedures and tools to improve methodological quality of MCDA in HTA studies. Research pathways include developing new model features, good practice guidelines, technologies to enable participation and behavioural research.

Branded prescription drug spending: a framework to evaluate policy options

Background

High drug spending is a concern for policy makers due to limits on access for patients. Numerous policies have been proposed to address high drug spending. The existence of multifarious proposals makes it difficult for policy makers to consider all the alternatives. We developed an approach to select the most viable options to present to policy makers.

Methods

We identified 41 different proposals in the peer-reviewed literature to reduce the level of spending or change the incentives for branded prescription drugs; ten of which we identified as promising proposals. Based on criterion used to assess various legislative proposals regarding branded pharmaceuticals we developed a framework to evaluate the ten promising proposals. We then used a modified Delphi technique to iteratively evaluate these ten proposals starting with the initial criterion. During each iteration, five researchers independently evaluated the ten policies based on available criterion and assessed how to modify the criterion to achieve consensus on what attributes the criterion were intended to measure. We highlight areas of disagreement to show where modifications to existing criterion are needed.

Results

We found general agreement for most policy-criterion combinations after three iterations. Areas with the greatest remaining disagreement include possible unintended consequences, the concept of value implied by many of the policies, and secondary effects by the pharmaceutical industry, insurers, and the FDA.

Conclusions

Our analysis provides an approach that can be applied to evaluate policy proposals. It also suggests factors that policy analysts and researchers should consider when they propose policy options and where additional research is needed to assess policy impacts. Developing an objective approach to compare alternatives may facilitate the adoption of policies for branded prescription drugs in the U.S. by allowing policy makers to focus on the most viable options.

Electronic supplementary material

The online version of this article (10.1186/s40545-017-0115-9) contains supplementary material, which is available to authorized users.

Societal perspective on access to publicly subsidised medicines: A cross sectional survey of 3080 adults in Australia

BACKGROUND

Around the world government agencies responsible for the selection and reimbursement of prescribed medicines and other health technologies are considering how best to bring community preferences into their decision making. In particular, community views about the distribution or equity of funding across the population. These official committees and agencies often have access to the best available and latest evidence on clinical effectiveness, safety and cost from large clinical trials and population-based studies. All too often they do not have access to high quality evidence about community views. We therefore, conducted a large and representative population-based survey in Australia to determine what community members think about the factors that do and should influence government spending on prescribed medicines.

METHODS

A choice-based survey was designed to elicit the importance of individual criteria when considering the equity of government spending on prescribed medicines. A representative sample of 3080 adult Australians completed the survey by allocating a hypothetical budget to different combinations of money spent on two patient populations. Societal preferences were inferred from absolute majority responses i.e. populations with more than 50% of respondents' allocation for a particular allocation criterion.

RESULTS

This study shows that, all else being equal, severity of disease, diseases for which there is no alternative treatment available on the government formulary, diseases that affect patients who are not financially well off, and life-style unrelated diseases are supported by the public as resource allocation criteria. Where 'all else is not equal', participants allocated more resources to the patient population that gained considerable improvement in health and fewer resources to those that gained little improvement in health. This result held under all scenarios except for 'end-of-life treatments'. Responses to cost (and corresponding number of patients treated) trade-off scenarios indicated a significant reduction in the proportion of respondents choosing to divide resources equally and a shift in preference towards devoting resources to the population that were more costly to treat for all criteria with the exception of severity of disease.

CONCLUSIONS

The general public have clear views on what's fair in terms of government spending on prescribed medicines. In addition to supporting the application of the 'rule of rescue', important considerations for government spending included the severity of disease being treated, diseases for which there is no alternative treatment available on the government formulary, diseases that affect patients who are not financially well off and life-style unrelated diseases. This study shows that the general public are willing to share their views on what constitutes an equitable allocation of the government's drug budget. The challenge remains to how best to consider those views alongside clinical and economic considerations.