Presentation (CTI)

OBJECTIVES: The Centers for Medicare and Medicaid Services has recently published three international reference pricing models: GLOBE, GUARD, and GENEROUS. Participation in two of these (GUARD and GLOBE) has been proposed as mandatory. Once implemented, the price gaps between the US and referenced countries will likely create pressure for price convergence. This study aims to “gauge the pressure” by quantifying the extent of required rebates.
METHODS: We developed a calculator based on the proposed rules. To illustrate the potential impact, we modelled two hypothetical products: a targeted oncology therapy at full uptake and an advanced therapy medicinal product (ATMP). Annual per-patient ex-US list prices were assumed to range from USD 40,000-90,000 for the oncology therapy and USD 200,000-300,000 for the ATMP, compared with US list prices of USD 200,000 and USD 500,000, respectively. Confidential ex-US rebates were assumed to range from 10% to 50%. Utilization was assumed to be proportional to the population of the referenced countries.
RESULTS: For the oncology therapy, the GLOBE and GUARD models resulted in required US price reductions of 70-75%, while the GENEROUS model implied a reduction of approximately 80%. For the ATMP, where US and ex-US prices are typically closer, the required price reductions were 40-50% under GLOBE and GUARD and approximately 60% under GENEROUS. To limit the required US price reduction to 20% under the mandatory programs, manufacturers would need to increase ex-US prices by up to approximately 190% for the oncology therapy and 50% for the ATMP.
CONCLUSIONS: If implemented, the proposed initiatives would place substantial downward pressure on US prices in important therapeutic areas. This could create incentives for manufacturers to seek higher prices outside the US. Policymakers in referenced countries may need to consider strategies to mitigate consequences, such as reduced launch incentives and product withdrawals.