Incorporating Life Cycle Drug Pricing in Cost-Effectiveness Models: What Are the Opportunities and Risks for Health Systems and Manufacturers?

Speaker(s)

Moderator: Mark Sculpher, PhD, Centre for Health Economics, University of York, York, UK
Panelists: Peter Neumann, ScD, Center for the Evaluation of Value and Risk in Health, Tufts Medical Center, Boston, MA, USA; Beth Woods, BA, MSc, Centre for Health Economics, University of York, York, UK; Dan Ollendorf, PhD, Institute for Clinical and Economic Review, Boston, MA, USA

Presentation Documents

ISSUE:

Generic and biosimilar medicines provide health benefits at low costs long after the patent expiration of the brand-name products they replace. However, most cost-effectiveness analyses of new products do not account for this process of drug genericization. This has led to concerns that current cost-effectiveness analyses may overestimate the long-term costs of pharmaceuticals, leading to inappropriate pricing and access decisions for new drugs. In this panel we will debate whether drug genericization should be reflected within cost-effectiveness analysis of new pharmaceuticals.

OVERVIEW:

Mark Sculpher will provide an accessible overview of the issue (5 minutes), this will be followed by a short presentation by each panelist (12 minutes) and an open debate on the topic.
Peter Neumann will argue that it is time for economic evaluations of new pharmaceuticals to use broader methods that account for downstream, generic pricing. Beth Woods will argue that including drug genericization within cost-effectiveness analysis would substantively increase prices of new medicines, and that this methods shift would need to be accompanied by a change to the principles of value-based pricing. Dan Ollendorf will discuss the approaches currently taken by HTA agencies like ICER to life-cycle pricing, and the practicality and acceptability of the types of changes proposed by Peter and Beth. This presentation will be of interest to a wide range of stakeholders with interests in economic evaluation of pharmaceuticals, and pharmaceutical pricing and reimbursement policy.

Code

315

Topic

Economic Evaluation