A theory on ICER pricing and optimal levels of cost-effectiveness thresholds: a bargaining approach

Challenges in Value Assessment for One-Time Gene Therapies for Inherited Retinal Diseases: Are We Turning a Blind Eye?

OBJECTIVES

X-linked retinitis pigmentosa (XLRP) is a rare inherited retinal disease with no available treatment. Gene therapies in clinical trials will pose challenges for health technology assessment (HTA) if found to be safe and effective. We evaluated 2 of these challenges, namely acceptability and difficulties in assessing value beyond short-term patient health and healthcare savings and discounting in economic evaluation.

METHODS

We conducted a narrative literature review on the socioeconomic burden of XLRP to identify relevant components of value for a hypothetical gene therapy from a societal perspective and to assess their relative importance. We compared the resulting value profile against the value frameworks of three European HTA agencies. We also reviewed their guidelines on discounting and potential discounting issues specific to XLRP.

RESULTS

Much of the societal value of an XLRP gene therapy is likely to originate from productivity effects, carer spillovers, and value elements related to patient uncertainty. The evidence on these effects, however, is often limited, making it difficult for HTA agencies to assess them. Cost-effectiveness results are likely to be highly sensitive to the discount rate, and discounting will compound the effects of omitting important sources of value.

CONCLUSIONS

We have identified and detailed important components of societal value, key evidence gaps, and potential discounting issues for an XLRP gene therapy, which can inform future value assessments. Many of these may apply to gene therapies in other disease areas. Revisiting existing HTA approaches is recommended to ensure these are fit for purpose for such new classes of treatment.

Drug pricing models, no 'one-size-fits-all' approach: a systematic review and critical evaluation of pricing models in an evolving pharmaceutical landscape

Access to new medicines is crucial for patients but increasingly sparks discussion due to high prices. Simultaneously, the growing emphasis on specialized products and uncertainty surrounding the long-term effectiveness of new drug classes brought to the market underscore the need for innovative pricing approaches. A systematic literature review of pharmaceutical pricing models, accompanied by a critical appraisal, was conducted to offer insights contributing to novel approaches balancing sustainable pharmaceutical innovation with affordability and accessibility for patients. Six different pricing models are identified: value based pricing, basic cost-based pricing, and four more comprehensive pricing models incorporating numerous elements: the cancer-drug-pricing model, AIM model, (Nuijtens) discounted cash flow, and the real-option rate of return method. Although there are many similarities among the models, each has unique assumptions for implementation. For instance, all models except for the standard incremental cost-effectiveness ratio and basic cost-based pricing consider the number of eligible patients and the remaining patent period. Only the AIM model and the Nuijtens discounted cash flow model use lump sums. Both the latter and the real-option rate of return method explicitly include the cost of capital as a major cost-based component. Recognizing the diverse applications of each model highlights the need for more differential and dynamic pricing tailored to the characteristics and therapeutic areas of each drug. Additionally, the study underscores the importance of cost transparency in achieving this goal. Consequently, these findings can help stakeholders develop sustainable and affordable drug pricing mechanisms that address the complexities of the ever-changing pharmaceutical landscape.

Effectiveness and cost-effectiveness of community-based mental health services for individuals with severe mental illness in Iran: a systematic review and meta-analysis

BACKGROUND

Severe mental illness (SMI) imposes a substantial worldwide burden of disability, highlighting the need for comprehensive and adaptable mental health services. This study aims to assess the efficacy and cost-effectiveness of community-based mental health services (CBMHS) in reducing relapse and rehospitalization rates among individuals with SMI in Iran.

METHOD

A systematic review and meta-analysis were conducted. Medline, EMBASE, ISI, SCOPUS, and ProQuest were searched until December 2022. We focused on randomized controlled trials, quasi-experimental studies, or economic studies related to individuals with SMI. Out of 127 articles, 17 were selected for a full-text review. The primary outcomes were the severity of psychopathology, rehospitalization rates, and the mental health of caregivers. We also examined community-based interventions and their impact on various outcomes. Data extraction and risk of bias assessment were performed, and critical appraisal was conducted using JBI checklists. Meta-analysis was carried out using STATA software. (PROSPERO registration. CRD42022332660).

RESULT

Rehospitalization rates among patients who received CBMHS were significantly lower, with an odds ratio of 2.14 (95% CI: 1.44 to 3.19), indicating a 2.14 times lower likelihood than those who received treatment as usual. A reduction in psychopathology accompanied this, SMD: -0.31, 95% CI: -0.49 to -0.13, I2 = 40.23%). Moreover, there was a notable improvement in social skills (SMD: -0.7, 95% CI: -0.98 to -0.44, I2 = 0.00%). The burden on caregivers also decreased (SMD: -0.55, 95% CI: -0.99 to -0.1, I2 = 63.2). The Incremental Cost-Effectiveness Ratio (ICER) for QUALY was acceptable, albeit with a wide range of 613 to 8400 Dollars.

CONCLUSION

CBMHS has demonstrated effectiveness and efficiency in Iran as a developing country. Additionally, it shows promise in mitigating the shortage of acute psychiatry beds. Using multiple data collection tools poses a limitation regarding data consolidation and conducting a meta-analysis.

Is the price right? Paying for value today to get more value tomorrow

BACKGROUND

Contemporary debates about drug pricing feature several widely held misconceptions, including the relationship between incentives and innovation, the proportion of total healthcare spending on pharmaceuticals, and whether the economic evaluation of a medicine can be influenced by things other than clinical efficacy.

MAIN BODY

All citizens should have access to timely, equitable, and cost-effective care covered by public funds, private insurance, or a combination of both. Better managing the collective burden of diseases borne by today's and future generations depends in part on developing better technologies, including better medicines. As in any innovative industry, the expectation of adequate financial returns incentivizes innovators and their investors to develop new medicines. Estimating expected returns requires that they forecast revenues, based on the future price trajectory and volume of use over time. How market participants decide what price to set or accept can be complicated, and some observers and stakeholders want to confirm whether the net prices society pays for novel medicines, whether as a reward for past innovation or an incentive for future innovation, are commensurate with those medicines' incremental value. But we must also ask "value to whom?"; medicines not only bring immediate clinical benefits to patients treated today, but also can provide a broad spectrum of short- and long-term benefits to patients, their families, and society. Spending across all facets of healthcare has grown over the last 25 years, but both inpatient and outpatient spending has outpaced drug spending growth even as our drug armamentarium is constantly improving with safer and more effective medicines. In large part, this is because, unlike hospitals, drugs typically go generic, thus making room in our budgets for new and better ones, even as they often keep patients out of hospitals, driving further savings.

CONCLUSION

A thorough evaluation of drug spending and value can help to promote a better allocation of healthcare resources for both the healthy and the sick, both of whom must pay for healthcare. Taking a holistic approach to assessing drug value makes it clear that a branded drug's value to a patient is often only a small fraction of the drug's total value to society. Societal value merits consideration when determining whether and how to make a medicine affordable and accessible to patients: a drug that is worth its price to society should not be rendered inaccessible to ill patients by imposing high out-of-pocket costs or restricting coverage based on narrow health technology assessments (HTAs). Furthermore, recognizing the total societal cost of un- or undertreated conditions is crucial to gaining a thorough understanding of what guides the biomedical innovation ecosystem to create value for society. It would be unwise to discourage the development of new solutions without first appreciating the cost of leaving the problems unsolved.