Affordability of New Technologies: The Next Frontier

The ethics of aggregation in cost-effectiveness analysis or, "on books, bookshelves, and budget impact"

In deciding how to allocate resources, healthcare priority-setters are increasingly paying attention to an intervention's budget impact alongside its cost-effectiveness. Some argue that approaches that use budget impact as a substantive consideration unfairly disadvantage individuals who belong to large patient groups. Others reject such claims of "numerical discrimination" on the grounds that consideration of the full budget impact of an intervention's adoption is necessary to properly estimate opportunity cost. This paper summarizes this debate and advances a new argument against modifying the cost-effectiveness threshold used for decision-making based on a technology's anticipated budget impact. In making this argument, the paper sets out how the apparent link between budget impact and opportunity cost is largely broken if the effects of a technology's adoption are disaggregated, while highlighting that the theoretical aggregation of effects during cost-effectiveness analysis likely only poorly reflects the operation of the health system in practice. As such, it identifies a need for healthcare priority-setters to be cognizant of the ethical implications associated with aggregating the effects of a technology's adoption for the purpose of decision-making. Throughout the paper, these arguments are illustrated with reference to a "bookshelf" analogy borrowed from previous work.

Critical Reflections on Reimbursement and Access of Advanced Therapies

Background: The health economic literature has questioned the cost-effectiveness and affordability of advanced therapies, proposed adjustments to value assessment frameworks, and discussed the use of outcome-based managed entry agreements and staggered payments in the last few years. The aim of this manuscript is to conduct a critical reflection on assessment criteria and access conditions for reimbursement of advanced therapies.

Methods: A narrative review of the peer-reviewed literature and grey literature was conducted in April 2021 by searching PubMed; Google Scholar; policy and legislative documents; websites of health technology assessment agencies, advanced therapy organisations, governmental advanced therapy innovation programmes, consultancy agencies; ISPOR conference abstracts and presentations.

Results: Based on the available evidence, this manuscript argues that: a) advanced therapies can be cost-effective at high prices set by manufacturers; b) the economic evaluation framework adopted by many payers under-values these products; c) advanced therapies can be affordable and may not require spread payments; d) outcome-based managed entry agreements are theoretically attractive, but challenging in practice; e) the cost-effectiveness of advanced therapies depends on the outcome-based managed entry agreement and payment approach; f) there is a role for multinational collaborations to manage reimbursement and access of advanced therapies.

Conclusions: This manuscript shows that there is no single approach to reimbursement and access of advanced therapies. Instead, we support a more tailored assessment of health economic aspects of advanced therapies, which considers the heterogeneity of these products and their target populations.

Complicated legacies: The human genome at 20

Millions of people today have access to their personal genomic information. Direct-to-consumer services and integration with other “big data” increasingly commoditize what was rightly celebrated as a singular achievement in February 2001 when the first draft human genomes were published. But such remarkable technical and scientific progress has not been without its share of missteps and growing pains. Science invited the experts below to help explore how we got here and where we should (or ought not) be going.

Understanding Payer Perspectives on Value in the Use of Pharmaceuticals in the United States

BACKGROUND

In recent years, value assessment frameworks have been introduced to inform discussions about how to define and assess value in the U.S. health care system. However, there is uncertainty as to how value assessment frameworks and other approaches to achieve value such as outcomes-based contracting are perceived and used in coverage decisions.

OBJECTIVE

To understand how U.S. payers determine value in the use of pharmaceuticals and how it differs from payers outside the United States.

METHODS

Qualitative in-depth phone interviews with 13 executive-level public and private U.S. managed care representatives and 6 health technology assessment advisors outside the United States were conducted from September to November 2017.

RESULTS

Despite various mechanisms used by U.S. payers to assess value, no consistent definitions of value were provided, and U.S. payers felt limited in what they can do to achieve value in pharmaceutical decision making. Value assessment frameworks are not formally considered in formulary and reimbursement decisions but are used as a reference as they become available by most or all U.S. health plans. U.S. payers expressed concerns, including limited control over pharmaceutical pricing and budget caps, and limited ability to use incremental cost per quality-adjusted life-year thresholds. Outcomes-based contracting could have some utility in specific cases where the treatment has a particularly high cost and a clear outcomes measure, but payers indicated that outcomes-based contracts can be difficult to operationalize, and determination of savings was uncertain. Payers outside the United States-who are enabled by government health care bodies, policy tools, and analytical frameworks that have no counterpart in the United States-have a wider array of instruments at their disposal. U.S. payers were largely open to learning from other health care systems outside the United States, particularly the German health care system, where patient-relevant benefit compared with a predetermined treatment comparator is the primary determinant for price negotiations.

CONCLUSIONS

Although there is interest in including value assessment frameworks during the decision-making process in the United States, there are significant challenges to operationalizing them. The current environment in the United States restricts payers' ability to make favorable contracts with manufacturers, and changes to the U.S. health system design are needed to facilitate this effort. Adoption of a value assessment framework in Medicare or Medicaid would accelerate adoption of these tools by private payers in the United States.

DISCLOSURES

This study was conducted by RTI Health Solutions under the direction of The Pew Charitable Trusts and was funded by The Pew Charitable Trusts. Vekaria is employed by RTI Health Solutions. Reynolds and Coukell are employed by The Pew Charitable Trusts. Brogan and Hogue have nothing to disclose.

Budget Impact of Cryoablation Versus Radiofrequency Ablation of Atrial Fibrillation in the Brazilian Public Healthcare System

BACKGROUND

Cryoablation is a new technology for ablation of atrial fibrillation (AF), effective and safe when compared with standard radiofrequency (RF) ablation. Nevertheless, the economic impact of its incorporation is unknown, especially considering the public health system of a developing country. This study analyzed the budget impact of cryoablation incorporation for treatment of paroxysmal AF in the Brazilian public health system.

METHODS

The budget impact was calculated as the cost difference between the current scenario (RF ablation guided by electroanatomic mapping) and the new scenario (cryoablation). The cost of each intervention was obtained by multiplying the price of a single procedure by the number of candidates for it. Other technologies (RF ablation guided by intracardiac echocardiography or with a nonirrigated catheter) were considered in a sensitivity analysis.

RESULTS

The budget impact showed savings of $43 097 096.84 with cryoablation. In the sensitivity analysis, cryoablation resulted in cost savings compared with RF ablation guided by intracardiac echocardiography, whereas in comparison to RF ablation with the nonirrigated catheter, cryoablation was more expensive. A market share assessment, performed using an incorporation rate of 3% per year, indicated savings of approximately $800 000 per 5 years.

CONCLUSIONS

Cryoablation of AF resulted in cost savings compared with the current scenario (RF ablation guided by electroanatomic mapping). When alternative technologies were considered, cryoablation was more expensive than RF ablation with a nonirrigated catheter, but it also resulted in savings compared with RF ablation guided by intracardiac echocardiography. Overall, cryoablation of AF may reduce expenditures in the Brazilian public health system.

Incorporating Affordability Concerns Within Cost-Effectiveness Analysis for Health Technology Assessment

BACKGROUND

Recent policy developments and journal articles have emphasized a divergence: when interventions are found to be cost-effective but unaffordable. This apparent paradox reflects a conventional practice of cost-effectiveness analysis that does not properly evaluate the opportunity costs of an intervention that imposes non-marginal costs on the healthcare system.

OBJECTIVE

Taking the perspective of an exogenously resource constrained decision maker, this paper presents a framework by which concerns for affordability can be appropriately incorporated within cost-effectiveness analysis.

METHODS

A net benefit framework is proposed where health opportunity costs are estimated for each simulation iteration within each time period. The framework is applied to a hypothetical case study based on the recent experience of the English NHS with new hepatitis C drugs.

RESULTS

Under the proposed framework, but not under conventional cost-effectiveness analysis, estimates of health opportunity costs differ between scenarios involving different profiles of budget impact even when their net present value, or expected value, are the same.

CONCLUSIONS

The framework presented here reflects the importance of the scale of budget impacts along with their uncertainty distribution and time profile. In doing so it resolves issues with the conduct of conventional cost-effectiveness analysis where affordability concerns are not explicitly incorporated.

Are Global Health Systems Ready for Transformative Therapies?

BACKGROUND

We have seen significant advancement in a range of health technologies, some with transformative or curative potential. Nevertheless, it is often unclear how global health systems recognize or reward innovation.

OBJECTIVES

To consider what is transformative, challenges for transformative therapies, and downstream health ecosystem effects.

METHODS

A systematic review of publications in English between 2012 and 2018 was conducted with a focus on value assessment processes and health system effects of a range of breakthrough health technology categories. After screening 9012 records, 222 unique studies were identified. The study also included an analysis of 100 health technology assessments (HTAs) from 5 markets to consider how and in what ways global HTA bodies evaluate transformative therapies. Global sales and technology/procedure utilization data were also evaluated to gain insights into patient access and commercial impact.

RESULTS

This article evaluated uncertainties around evidence of efficacy, safety, and duration of effect, as well as underlying study quality and methodological considerations in the target categories. Although many HTA evaluations had similar approaches to assessing parameters such as safety, there were significant differences across technology categories. Technology-driven trends also surfaced where global HTA and payer systems may not yet be prepared to recognize and reward emerging technology impacts, including use of next-generation diagnostic results to guide care, considering novel impacts on therapy sequencing and clinical pathway management, and changes in payment and health delivery models.

CONCLUSIONS

Some trends stemming from rapid evolution of breakthrough therapies will prompt reconsideration of our conventional value assessment and reward models, because health system measurement and management processes have not fully anticipated their effects.

Uncertainty and Cures: Discontinuation, Irreversibility, and Outcomes-Based Payments: What Is Different About a One-Off Treatment?

Payers are concerned that one-off "cures" bring great uncertainty with the consequential risk of incorrect adoption decisions, and significant budget impact from large one-off payments. Innovators worry about bias against "cures" in favor of repeat treatment, which is not in patients' interests. We find that even in the absence of a difference in uncertainty of outcomes, adverse pay-offs differ. The greater financial risk associated with a cure is related to the issue of treatment discontinuation, driven by irreversibility. This paper uses a stylized example to illustrate the need to separate three different elements of the issue: (i) one-off versus repeat or ongoing treatment, (ii) duration of treatment effect, and (iii) the potential role of financial arrangements or risk sharing to mitigate the financial risk to the payer. It concludes that: (i) prevalence and discontinuation issues mean that the impact on the payer of an incorrect decision is greater with a one-off treatment than a repeat therapy; (ii) with evidence collection this risk diminishes over time (a form of CED or OWR); and (iii) financial arrangements or risk sharing can eliminate differences for the payer as between one-off and repeat therapy. The impact of (iii) also addresses payer concerns about budget impact.

Was It Worth Introducing Health Economic Evaluation of Innovative Drugs in the French Regulatory Setting? The Case of New Hepatitis C Drugs

OBJECTIVE

This paper constitutes the first attempt to draw lessons from the recent uptake of health economic evaluation of innovative drugs in the French regulatory framework.

STUDY DESIGN

Taking the example of new direct-acting antivirals against hepatitis C virus, the paper asks whether and how the cost-effectiveness (CE) opinions issued by the French National Health Authority improve the information available to support the pricing decisions.

METHODS

The analysis compares the assessment of these drugs based on three different sources: CE opinions, clinical opinions, and the published cost-utility analyses (CUA) available in the literature and identified through a systematic review.

RESULTS

The results show that CE opinions bring to the fore three issues prone to impact the incremental cost utility ratio and those were not available to the decision maker through clinical opinions or published CUA: the stage of treatment initiation, the modeling of the disease progression, and the uncertainty around the efficacy rates.

CONCLUSIONS

France has introduced the criterion of the cost per QALY gained in the pricing and regulation of innovative pharmaceuticals since 2013. Our analysis shows that the use of CUA does enhance the information available to the decision makers on the value of the treatments.

Budget impact analysis of secukinumab versus adalimumab in the treatment of ankylosing spondylitis

BACKGROUND

Biologic treatments have enhanced the treatment outcomes of patients with active ankylosing spondylitis (AS). Until recently, TNF-alpha-inhibitors have been the only biologics approved for the treatment of active AS. The objective of this study was to assess the potential financial impact of the first non-TNF-alpha biologic secukinumab (fully human IL-17A-inhibitor) vs adalimumab (TNF-alpha-inhibitor) in the treatment of AS in Finland.

MATERIALS AND METHODS

In this model-based budget impact analysis, patients were treated either with secukinumab (150 mg) or adalimumab (40 mg). The number of patients and market share of different biologics were based on national reimbursement registry data. Adalimumab was the most commonly used biologic treatment for AS, and in the base case analysis all adalimumab patients are assumed to switch to secukinumab. Response rates were based on a matching-adjusted indirect comparison between secukinumab and adalimumab. Patients not achieving response were switched to another biologic treatment.

RESULTS

Treating AS patients with secukinumab instead of adalimumab leads to potential savings of 18.2 million euros within a 5-year time period. The total costs within the follow-up time were 59.5 million euros and 77.7 million euros with and without secukinumab, respectively. According to sensitivity analyses, a higher adoption rate of secukinumab corresponds to higher potential savings.

CONCLUSIONS

Secukinumab is a cost-saving treatment option compared with adalimumab in the treatment of AS in Finland. More patients could be treated with a biologic by allocating resources more efficiently.

Long-term Survival and Value of Chimeric Antigen Receptor T-Cell Therapy for Pediatric Patients With Relapsed or Refractory Leukemia

Importance

Among children and young adults with relapsed or refractory B-cell acute lymphoblastic leukemia, the rate of 5-year disease-free survival is 10% to 20%. Approval of tisagenlecleucel, a chimeric antigen receptor T-cell therapy, represents a new and potentially curative treatment option. However, tisagenlecleucel is expensive, with a current list price of $475 000 per one-time administration.

Objective

To estimate the long-term survival and value of tisagenlecleucel for children and young adults with B-cell acute lymphoblastic leukemia.

Design, Setting, and Participants

In this cost-effectiveness analysis, a decision analytic model was designed to extrapolate trial evidence to a patient lifetime horizon. The survival evidence for the model was extracted from 3 studies: B2202 (enrolled patients from April 8, 2015, to November 23, 2016), B2205J (enrolled patients from August 14, 2014, to February 1, 2016), and B2101J (enrolled patients from March 15, 2012, to November 30, 2015). Long-term survival and outcomes of patients younger than 25 years with B-cell acute lymphoblastic leukemia that is refractory or in second or later relapse were derived using flexible parametric modeling from the direct extrapolation of event-free survival and overall survival curves. The published Kaplan-Meier curves were digitized from November 1, 2017, to November 30, 2017, using an algorithm to impute patient-level time-to-event data. Sensitivity and scenario analyses assessed uncertainty in the evidence and model assumptions to further bound the range of cost-effectiveness. Data were analyzed from December 1, 2017, to March 31, 2018.

Interventions

The primary intervention of interest was tisagenlecleucel. The comparator of interest was the chemoimmunotherapeutic agent clofarabine.

Main Outcomes and Measures

Model outcomes included life-years gained, quality-adjusted life-years (QALYs) gained, and incremental costs per life-year and QALY gained.

Results

Forty percent of patients initiating treatment with tisagenlecleucel are expected to be long-term survivors, or alive and responding to treatment after 5 years. Tisagenlecleucel had a total discounted cost of $667 000, with discounted life-years gained of 10.34 years and 9.28 QALYs gained. The clofarabine comparator had a total discounted cost of approximately $337 000, with discounted life-years gained of 2.43 years and 2.10 QALYs gained. This difference resulted in an incremental cost-effectiveness ratio of approximately $42 000 per life-year gained and approximately $46 000 per QALY gained for tisagenlecleucel vs clofarabine. These results were robust to probabilistic sensitivity analyses. Across scenario analyses that included more conservative assumptions regarding long-term relapse and survival, the incremental cost-effectiveness ratio ranged from $37 000 to $78 000 per QALY gained.

Conclusions and Relevance

Tisagenlecleucel likely provides gains in survival and seems to be priced in alignment with these benefits. This study suggests that payers and innovators should develop novel payment models that reduce the risk and uncertainty around long-term value and provide safeguards to ensure high-value care.