OBJECTIVES: Alopecia areata (AA) is an autoimmune disease characterized by nonscarring hair loss. Severe AA, defined as >50% score on the Severity of Alopecia Tool (SALT), is prevalent in 0.04-0.09% of the US population. Corticosteroids, minoxidil, and immunomodulators are used to treat AA; however, there are no FDA-approved therapies. Baricitinib is an oral Janus kinase inhibitor being investigated for treating severe AA. The budget impact of adding baricitinib to a commercial formulary for severe AA treatment was estimated from a US payer perspective.

METHODS: A budget impact analysis was conducted using a comparative cost determination framework. Starting with a hypothetical plan of one million lives, the number of patients with severe AA eligible for baricitinib was estimated. Market basket comparators were identified based on the National Alopecia Areata Foundation treatment algorithm, Alopecia Areata Consensus of Experts studies, and a Lilly real-world treatment patterns study. Equi-proportional adoption of baricitinib was assumed, with baricitinib uptake increasing from 0.7% to 3.0% over the 5-year time horizon. All treatments were assumed to have a 12-month treatment duration and a new cohort entered the model each year. Treatment costs were from published wholesale acquisition costs and excluded rebates and cost-sharing. Dosing, administration, and monitoring requirements were from product prescribing information and published literature. Unit costs were from publicly available fee schedules. One-way sensitivity analyses (OWSA) were performed by varying all parameters by ±20%.

RESULTS: The net 5-year budget impact was $1,383,345 (11.7% budget increase) or $0.023 per member per month (PMPM). OWSA results remained within ±$0.005 PMPM of the base case, with results most sensitive to population and epidemiology inputs and projected baricitinib uptake.

CONCLUSIONS: The addition of baricitinib to a formulary is expected to have a negligible impact on a commercial plan’s budget when considering a market basket that reflects real-world treatment patterns.