OBJECTIVES: “Drug development” is typically perceived as ending when regulatory “hurdles” of quality, efficacy, and safety are satisfied. Addressing the “fourth hurdle” of payer reimbursement is often a neglected secondary focus due at least two factors: 1) high costs of pivotal trials, and 2) challenges in translating clinical outcomes in randomized trials to the real-world setting, including the perception of insufficient data to formulate rigorous economic evidence prior to later stage trial readouts.

Recent data provide quantifiable evidence that challenges in payer reimbursement can delay the addition of new drugs to a formulary; for example, at three years post-approval, only ~30% of approved drugs were covered by Medicare insurance plans without restrictions unless “fast-tracked” by the FDA (Shaw et al. 2018). These data reflect the need to proactively consider payer strategies during drug development, not only for the USA, but also worldwide where payer evidentiary requirements are generally more stringent.

METHODS: M&S-based methods are well accepted by regulators to generate supportive evidence of clinical outcomes, including population PK/PD modeling, quantitative systems pharmacology (QSP), agent-based modeling (ABM), and clinical trial simulation. These approaches can be initiated in early clinical development and integrated alongside pharmacoeconomic (PE) models for potentially wide-ranging and impactful applications: identifying key evidence gaps that most affect economic value, guiding prioritized real-world data collection, understanding the economic impact of variations in dosing regimens and subpopulations, and informing drug differentiation strategies from both a clinical and economic perspective.

RESULTS: Here, we review details of recent PK/PD/PE model success stories in infectious diseases as the basis to propose redefining the term “drug development” to include consideration of the fourth hurdle alongside the first three.

CONCLUSIONS: This seemingly simple semantic change could serve as a powerful tool to enable the industry to better recognize the value of proactive planning for payer reimbursement earlier in the process.