The Importance of Considering Price Metrics and Market Dynamics in US Economic Evaluations: The Case of Sglt-2 Inhibitors in the Treatment of Type 2 Diabetes (T2D)


Willis M1, Neslusan C2, Nilsson A1
1The Swedish Institute for Health Economics (IHE), Lund, Sweden, 2Janssen Scientific Affairs, LLC, Titusville, NJ, USA


In the US T2D market, prices reflect both branded and generic competition, within and across classes. Despite recommendations, comparative economic analyses usually hold relative prices constant and, equally unrealistic, often use list prices. Even the few analyses that use prices net of manufacturer rebates understate opportunity costs by excluding time-varying intermediary margins. We illustrate the implications of these choices by simulating canagliflozin 300mg vs. sitagliptin 100mg in treating T2D.


Health outcomes and costs associated with these treatment strategies were simulated starting at canagliflozin launch in 2014. List prices, net prices, and systemwide net expenditures (SNE) (i.e., the sum of intermediary margins and net price) were sourced from SSR Health data. Results using fixed 2014 prices were compared to results based on actual prices through 2021 and to results based on forecasted prices over 25 years using T2D market price trend data available in 2014.


Canagliflozin was associated with fewer micro- and macrovascular complications, resulting in sizable cost offsets and greater longevity. Replacing fixed list prices with actual time-varying net prices reduced estimated canagliflozin and sitagliptin costs by 40% and 60%, respectively. Using fixed 2014 net prices versus actual time-varying net prices overestimated the difference in drug cost between canagliflozin and sitagliptin by 37%. Net total cost savings with canagliflozin were 11 times higher with time-varying actual SNE versus time-varying actual net prices. The 25-year results were more variable, driven by additional uncertainty introduced by modeling future prices.


Results illustrate the sensitivity of comparative economic analysis to different price metrics and assumptions about future prices, as well as the importance of accounting for rebates paid to insurers and PBMs. Like other time-varying parameters routinely projected into the future, prices that reflect the current market and anticipated market dynamics should be used as per guidelines.

Conference/Value in Health Info

2023-05, ISPOR 2023, Boston, MA, USA

Value in Health, Volume 26, Issue 6, S2 (June 2023)




Economic Evaluation

Topic Subcategory

Cost-comparison, Effectiveness, Utility, Benefit Analysis


No Additional Disease & Conditions/Specialized Treatment Areas

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