Without Rebates, Evidence Could Be Key For Formulary Placement
April 18, 2019
Information about a drug’s effectiveness compared to alternative treatments could help drug makers argue for formulary placement in a system without rebates, Deloitte’s head of life sciences said. Some patient advocates worry that using comparative effectiveness data in coverage decisions could limit access, as different drugs work better for different patients.
Greg Reh, Deloitte’s vice chairman and leader of its life science division, said the Trump administration’s point-of-sale rebate proposal could force drug companies to compete more directly on value.
“This might require a shift in strategy toward more robust evidence generation, the development of support services, and greater competition in value-based contracts,” Reh wrote in an analysis.
He recommends that drug makers evaluate additional outcomes beyond what is required by FDA to prove their product’s superiority compared to other drugs, study effectiveness in patient sub-populations and add strategies to help patient adherence and convenience.
Congressional Medicare advisers recently discussed using reference pricing based on comparative effectiveness evidence to develop payment policy in Medicare Part B, though some commissioners still consider the idea too controversial to pursue in the immediate future.
Some patient advocates are concerned about comparative effectiveness data being used to limit patient access to medications, as different patients have different reactions to the same drugs and devices.
“Comparative effectiveness improves decision making by making sure the right patient gets the right treatment at the right time. But when you are talking about allowing coverage decisions based on averages to drive health care decision-making for individual patients, you allow payers and governments to drive one-size-fits-all decisions for patients,” said Sara van Geertruyden, executive director of the Partnership to Improve Patient Care.
Groups that conduct comparative effectiveness and cost-effectiveness analyses hold significant sway over coverage decisions in other countries such as the United Kingdom and Canada. The influence of similar organizations has been limited in the United States but is increasing as pressure mounts to address high drug prices.
Lawmakers created a government-sponsored organization to conduct comparative effectiveness research, the Patient-Centered Outcomes Research Institute, in the Affordable Care Act. Medicare is allowed to factor PCORI’s research into decisions of which drugs to cover, though there are some restrictions.
The name of the institute was changed while it was being debated in Congress from the Comparative Effectiveness Research Institute to PCORI.
“Comparative effectiveness research went through a phase where it was linked in some people's minds to rationing, to cost-effectiveness measurement, and had transiently acquired a dubious name,” Joseph Selby, the first executive director of PCORI, told Medscape in 2012.
Selby has announced his retirement at the end of this year.
To avoid being associated with the negative connotations around rationing, Center for Medical Technology Policy Founder Sean Tunis said PCORI avoided addressing costs, cost-effectiveness and largely payers.
“The problem with that is that one of the original inspirations for setting this up was helping people make cost-conscious decisions in the face of unsustainable spending trend. So it narrowed the space in which PCORI felt comfortable initially operating,” Tunis said at an Alliance for Health Policy briefing.
Van Geertruyden said she thinks that the PCORI statute was developed carefully, and prefers the group’s approach to that taken by the Institute for Clinical and Economic Review, which she characterizes as geared toward payers instead of patient decision-making.
Unlike PCORI, ICER uses Quality-Adjusted Life Year measurements, which have been controversial in the United States, in its cost-effectiveness analysis. ICER pitches itself as an independent drug pricing watchdog that produces cost-effectiveness and budgetary impact reports to inform policy decisions. ICER did not respond to a request for comment.
A recent ICON white paper found ICER is becoming more influential as a decision-making resource for payers.
“We also know that contracting negotiations will be significantly impacted by ICER assessments going forward -- and that manufacturers will need to be prepared to reconcile their economic evaluations with ICER’s assessments,” ICON wrote. -- Rachel Cohrs
In an article for Inside Health Policy, Partnership to Improve Patient Care (PIPC) Executive Director Sara van Geertruyden highlighted concerns from patient advocates about the use of comparative effectiveness data being used to limit patient access to drugs. She pointed out the problems with a "one-size-fits-all" approach, touting the Patient Centered Outcomes Research Institute's (PCORI) approached to comparative effectiveness research over the payer-focused approach taken by the Institute for Clinical and Economic Review (ICER). “Comparative effectiveness improves decision making by making sure the right patient gets the right treatment at the right time," said van Geertruyden. "But when you are talking about allowing coverage decisions based on averages to drive health care decision-making for individual patients, you allow payers and governments to drive one-size-fits-all decisions for patients."
The article in its entirety can be read below.