Payment Reform

‘DrugAbacus’, a Comparative Cancer Drug Pricing Platform Powered by Real Endpoints’ RxScorecard™, is Launched

Posted on Friday, June 19, 2015

Westport, CT, June 19, 2015 – Real Endpoints (RE) is pleased to announce that its RxScorecard™ is the information technology platform supporting Memorial Sloan Kettering Cancer Center’s DrugAbacus – an interactive tool for considering the basis of cancer drug prices. Conceived by Dr. Peter B. Bach, Director of the Center for Health Policy and Outcomes at Memorial Sloan Kettering (MSK), DrugAbacus was launched at www.drugabacus.org. MSK’s DrugAbacus generates a dollar-value for cancer drugs available in the United States (beginning in 2001 with Gleevec) based on a user’s settings for six different domains of potential value including the treatment’s survival benefit, side effects, and the incidence of the condition targeted. Memorial Sloan Kettering licensed the Real Endpoints RxScorecard platform for research purposes so users can generate “Abacus prices” and compare them with actual prices of these drugs at the time of launch in a visual and intuitive format. “We believe RxScorecard is the only tool available that provides a 360 degree comparison of the multiple components of a drug’s value in an independent, objective and systematic approach. We developed the IT platform to make it very easy for users to access our analysis, and are delighted that Dr. Bach selected this platform for DrugAbacus,” said Julie Eskay Eagle, RE’s Vice...

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Wall Street Journal publishes article on new cancer pricing tool from Memorial Sloan Kettering using RE’s RxScorecard technology

Posted on Friday, June 19, 2015

June 19, 2015 – Memorial Sloan Kettering Cancer Center, one of the nation’s top cancer hospitals, has created an interactive calculator that compares the cost of more than 50 cancer drugs with what the prices would be if they were tied to factors such as the side effects the drugs produce, and the amount of extra life they give patients. Please click here to access the article....

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Evidence and Endpoints in Cancer: Can Both Payers and Regulators be Satisfied?

Posted on Wednesday, March 27, 2013

How can oncology drug developers design their trials to satisfy both regulators and payers, and thereby maximize both access and commercial success?  It’s an increasingly urgent question as cancer programs continue to dominate pipelines, and drugs bills. Yet “there’s a fundamental tension” between the clear evidentiary base required to get a drug approved, and the emerging, sometimes inconsistent data sought by payers to justify funding that drug, notes Roy Baynes, SVP Oncology Therapeutics at Gilead Sciences Inc. Above all, he emphasizes the need for close engagement with payers, at least in Europe, from an early stage. Collaborating prospectively with governmental payers may help address the reality that “individual sponsors have little leverage,” he says.  (In the US, it’s not at all clear to us that payers want much to do with pharmas before products get very close to market.  And in oncology specifically, payers still can’t really say “no” to paying for products approved by the FDA; European governments have no such inhibitions.) There are some rules that now beginning to hold across the board, though, notwithstanding often considerable differences in evidentiary standards across treatment-type, positioning, and disease area. Having a “meaningful comparator is obviously important,” point out Baynes, who will be speaking at NextLevel Pharma’s PharmAccess Leaders’ Forum in...

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UnitedHealth-Mayo: More Data, More Open. But Not Quite Neutral

Posted on Tuesday, January 22, 2013

UnitedHealth’s outcomes-focused research alliance with Mayo Clinic, announced Jan. 15, reminds us of big data’s central role in creating a value-driven US health care system.  The tie-up claims to have created the biggest-yet trove of claims-plus-clinical patient records in the US, combining over 100 million claims records from United’s Optum’s health services division with over 5 million clinical records from Mayo. As such, it’s powerful. Collating top-level insurance claims with in-depth clinical reports is as good as it gets right now for real-world-evidence hunters; it paints the most complete picture of patients’ disease progression that’s available large scale. That’s why payers and drug firms that have already teamed up in the quest for RWE are striving to bring providers into the fold. (You can hear more about AstraZeneca and partner HealthCore‘s efforts to build a consortium at the Real Endpoints’ Symposium on March 11-12.) Optum and Mayo are likewise inviting other organisations to contribute to, and fish in, this pool of longitudinal data: the alliance takes the physical form of Optum Labs, an ‘open innovation facility’ where players – including drug firms, payers, providers, academics – can, with further resources and questions of their own, “come together to conduct research, innovate and improve outcomes for patients,” said Andy Slavitt, Optum’s group...

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As Pressure Builds on US Prices, Is Pharma Ready?

Posted on Friday, December 14, 2012

Free drug pricing in the US has fewer than five years to run, thanks to mounting pressure on health care spend and resulting efficiency drives.  That’s the message to pharma investors, be it from fund-managers speaking at Bloomberg Industries Healthcare event in London on Dec. 10, or from analysts such as as Citi’s Andrew Baum. It’s tempting not to believe it. After all, for now, US drug price increases are actually at a five year high in the mass retail market, according to Bloomberg Industries’ healthcare research director Sam Fazeli. And hospital drug price increases, too, have rebounded since 2009. “For now, the game’s the same in the US: you can price at whatever you like,” he concluded.  With Europe on its knees, status quo in the US is what many pharma are relying on. They’d better make sure they have a plan B when the dream ends, though. “There’s a lot of momentum behind evidence-based therapy and paying-for-performance in the US. We have to be ready to hear about how some of that translates into drug pricing,” warned fund manager Dan Mahony of Polar Capital Holdings at the Bloomberg meeting. Zaltrap provided an early example of drug price pressure in the US: Hit hard by Memorial Sloan Kettering’s decision not to use it –...

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Reimbursement “Furies” Real, But Won’t Avenge Pharma Til 2017, Says Citi

Posted on Tuesday, December 4, 2012

“Beware the Three Furies,” warns Citi analyst Andrew Baum.  In a report for pharma investors published Nov. 29., Baum turns to classical mythology to describe shared savings models, drug pathways and ACOs — the forces that will soon dominate US health care plans. He’s chosen an interesting analogy: The Three Furies were goddesses of vengeance, who punished the wicked for their crimes; they’re also described as “tormenting those who have yet to atone for their sins”. So we, and plenty of others, agree that pharma should be nervous. “Reimbursement, not R&D pressure,” is the is the biggest risk facing pharma investors, writes Baum. But although “alarmed” by the drivers, and potential consequences, of US healthcare cost containment (particularly given the dire state of the EU), Baum reckons drug firms’ earnings won’t feel the full brunt of US pricing pressure “until at least 2017.” He argues that for the next five years, the revisions to the US healthcare system will have the greatest impact on medtech, hospitals, and diagnostics, with less focus on pharmacy-related costs.  Even in the case of drug pathways, singled out as the most important long-term structural risk to the biopharma industry “meaningful adoption will remain slow” in Baum’s view. To back that up, he cites research by...

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Want Better Access? Then Take Some More Risk

Posted on Tuesday, November 20, 2012

Biopharma is an industry seeped in an above-average concentration of risk. Scientific, clinical and regulatory uncertainties add to more typical commercial and market-driven risks. Given that, you’d think pharma execs would be a little more willing to stick their necks out and embrace (or at least explore) change. Some are. They get that payer cost-pressures and pipeline productivity challenges are forcing new, make-or-break approaches to clinical development, payer interactions, and commercial positioning. Yet toward the by-now-rather-less-radical idea of more closely integrating regulatory and HTA requirements, the pharma sector’s attitude is “somewhat capricious,” notes Mel Walker, recently appointed VP Market Access at Otsuka Pharmaceuticals Europe, after six years at GSK. That even a few companies still resist this idea seems odd, since it’s pharma (along with patients) that has most to benefit from a more harmonized regulatory-HTA process. Some drug industry execs are worried that putting regulators in the same room as HTAs — an idea that has been piloted in Europe, in the context of scientific advice, since 2010 — “may lead to HTA somehow influencing regulators to say ‘no’ to more products”, illustrates Walker, who will chair a discussion on HTA/regulatory convergence at the PharmAccess Leaders’ Forum in Berlin later this month. Alasdair Breckenridge, chairman of the UK regulator...

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Drug Approvals Need Shades Of Grey

Posted on Monday, November 12, 2012

FDA’s Endocrinologic and Metabolic drugs advisory committee on Nov. 8 voted 8-4 in favor of recommending Novo’s latest insulin degludec (Tresiba) for approval. The detailed debate and deliberation underscored how unsuitably black-and-white the drug approval process is.  In the end, FDA (just like the European Medicines Agency), will say either ‘yes’ or ‘no’.  Yet the difference between acceptable risk and unacceptable risk among drug treatments isn’t a well-defined one. Nor is the threshold or criteria separating insufficient data from sufficient data. Now, as it happens, in Tresiba’s case the committee also unanimously voted in favor of a post-approval CV outcomes trial, reflecting lingering uncertainties about the drug’s risks.  But that’s unusual — and the conditions, timelines and the potential impact of the results remain unclear. What’s needed is a drug approval system in shades of grey — incremental steps on the way to full approval, for drugs that aren’t definite rejects, nor dead-cert approvals (e.g. most drugs). Programs including FDA’s accelerated approval and EU’s conditional approval go some way towards that, but only rarely. (Just 6 drugs were approved conditionally by EMA between 2009-2011, less than 10% of the total) A handful of projects run by regulators and academics around the world have been seeking, for several years now, to define and progress new, adaptive approaches to...

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Sanofi Blinks First: Zaltrap Price Cut Proves HTA Has Reached The US

Posted on Monday, November 12, 2012

Sanofi’s decision last week to cut the price of its colon cancer drug Zaltrap by up to 50% showed that the US market is no longer immune to European-style drug price pressure. Never mind that the move was partly a result of a messed-up calculation on Sanofi’s part: this was a defining moment in the evolution of America’s troubled health care system. That the price of a drug was cut at all, and voluntarily (albeit under pressure), is notable enough: prices usually go up, especially in the US. But the size of the cut (deeper than almost all of the discounts squeezed out of pharma by European cost-watchdogs’ rule-dominated systems), and the fact that we’re talking about a drug for cancer (until recently among the most price-protected TAs) that’s, technically at least, an NME, is even more remarkable. Zaltrap’s high price of $9-11,000 per month, its questionable efficacy (extending overall survival by just 1.5 months) and safety concerns such as a boxed warnings over fatal GI bleeding were what prompted leading cancer specialists at Memorial Sloan-Kettering Cancer Center to boycott the treatment. The MSKCC scientists were behaving just like an EU-style health technology assessment agency: they were in effect importing the spirit, if not the institution, of a NICE-like hurdle to the US. (There’s no way, incidentally, that Zaltrap...

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The Value Debate: Can Personalized Drugs Support Personalized Pricing?

Posted on Wednesday, October 10, 2012

“Personalized health care requires a new reimbursement model,” declared Roche’s VP Global Pricing & Market Access Jens Grueger in the elegant London county hall debating chamber on Monday, at the Office of Health Economics (OHE)-sponsored gathering of payers, pharma and economists. The venue was appropriate.  Debate centered around whether the move towards more personalized medicine could reasonably support more personalized pricing.  Roche, with plenty of targeted medicines at stake, thinks, perhaps wishfully, that more differential, ‘value-based’ pricing is one answer to the soaring cost of innovation. Not all payers are so enthusiastic. Grueger’s calling for more differential pricing not just for the same drug in different indications (as already happens in rare cases today) but also within indications. Such “segment-specific” pricing might, for example, see a breast cancer drug priced differently when used in the late-stage setting versus in the adjuvant setting. As Grueger argued, the price would be “based on the value that the medicine brings” in particular settings for particular patients. Most commonly in HTA-driven countries today, a drug is granted an ‘average’ price based on its value across a range of settings. But, emphasized Grueger, that one-price-fits-all- indications strategy doesn’t suit the kinds of medicines that Roche and others are developing (drugs that, just like on-market Avastin, have potential across...

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