Multi-Indication Pricing: Pros, Cons and Applicability to the UK
1. Jorge Mestre-Ferrandiz*, Adrian Towse*, Renato Dellamano**
and Michele Pistollato***; *Office of Health Economics; ** MME
Europe and ValueVector; *** formerly OHE
Multi-Indication Pricing: Pros, Cons
and Applicability to the UK
3. AES 2016
What is MIP, and why do we
care?
• Multi-indication pricing (MIP) involves setting a different
price for each indication approved for the medicine
• Many medicines currently available, and many more in
pharmaceutical industry pipelines, are likely to be effective
in multiple indications – oncology prime example
• Assessment of value for oncology products more complex
• Prices paid for branded medicines should aim to reflect
their value – thus, for multi-indication medicines, prices
should be different across indications to reflect their
different values
• Yet current pricing and reimbursement systems are not
equipped to handle this
4. AES 2016
The case for …a single, uniform, price across
indications has negative consequences
• There tends to be one single (uniform) price across all
indications => price and clinical value will rarely match up
across multiple indications
• Single price based on higher-valued indications
• higher than optimal for one or more lower-value
uses/indications, leading to restricted access
• Single price based on lower value indications
• discourage development of further potentially higher-value
indications
• Both consequences are sub-optimal from society’s point of
view
• Multiple indication (or patient sub-group) pricing increases
the numbers of patients receiving treatment
• Some current pricing models do allow for what is termed as
“blended” pricing – mostly volume driven
5. AES 2016
We can illustrate the challenge of differential value
by indication or patient sub-group ….
Source: Hebborn A. Value-based pricing across indications: A company perspective. ISPOR Montreal, 3
June 2014, used in Pearson S, Dreitlein B, Henshall C (2016)
8. AES 2016
Aims
1. Can MIP be a flexible pricing scheme that
delivers a sustainable solution?
2. If it does, can MIP be implemented in the
UK, and how?
9. AES 2016
Methodology
OHE BRIEFING
UK WORKSHOP
DESK RESEARCH
Conceptual Analysis International Examples
Explore the pros and cons of multi-indication
pricing (MIP), its barriers and facilitators
10. AES 2016
Summary on international case studies
• Based on a relatively limited set of examples, MIP seems
practically applicable, in certain countries and conditions
• Especially in the case of drugs approved as different
medicinal products in different disease areas, extreme
price differences seem to be achievable
11. AES 2016
Aflibercept (Eylea in ophthalmology & Zaltrap in oncology)–
Comparison of per mg Prices (Official/Visible Ex-factory Price Level)
EU5 +
Switzerland
average
Zaltrap= £2.95
EU5 +
Switzerland
average
Eylea= £176.66
£155.87
£195.23
£171.10
£162.77
£198.33
£182.04
£2.48 £3.23 £3.32 £3.16 £2.59 £2.94
£-
£20
£40
£60
£80
£100
£120
£140
£160
£180
£200
France Germany Italy Spain UK Switzerland
Exchange Rates: 90 days average Sep-Dec
2014 (rates in appendix)
Sources: MME analysis of country drug compendia and institutional websites
Ex-FactoryPrice
Separation is helped by dosage form. Oncology use
is an infusion; ophthalmology use is pre-filled
syringes
12. AES 2016
Summary on international case studies
• In the case of multiple indications approved for the
same medicinal product
• MIP seems to be achievable in some countries, in
particular, in Italy and (potentially) in the UK
• Other countries, in particular, France, prefer a “blended”
pricing approach, with across the board price cuts when
the composite value proposition of the medicinal product
changes over time as a consequence of the availability of
new clinical evidence
15. AES 2016
Results (3)
Is MIP possible in the UK? Two operational challenges:
1. Whether the NHS can handle MIP schemes
involving variable net selling prices by indication,
requiring monitoring of volume usage per patient per
indication, and undertake any financial reconciliation ex
post to ensure that the correct funds flow across the
necessary stakeholders, be it at national or local level
2. Data availability: are there data sets which allow such
monitoring of volume usage per patient per
indication, and is the necessary data being generated
routinely or requiring ad hoc intervention?
• Separate branding by indication can work but significant
costs attached to this, and still potential for arbitrage
16. AES 2016
Discussion
• Intrigued by potential use of MIP
• Support value reflective pricing
• There is a need to ensure collaboration across all
stakeholders (NHS, industry, patients, doctors, nurses and
other health care professionals) if the NHS were to benefit
from any future pricing scheme(s) that allow different
prices across indications.
• If MIP were pursued, there was interest in using either (i)
“blended” pricing (at list level) or (ii) schemes that might
generate variable “net” selling prices.
• NHS’s Systemic Anti-cancer Therapy (SACT) data can in
principle support the implementation of MIP, albeit with
challenges. The current UK collaboration will help us
understand whether the SACT dataset could in practice
underpin such pricing systems
17. AES 2016
Conclusion
• Handling multiple indications within the same disease
area – including different potential lines of treatment
and/or combination regimens – is a challenge
• Innovative pricing schemes require potential to track
the specific utilisation of the drug in its different
indications, regimens and patient sub-populations
• The (limited) international experience shows that
certain health systems have already accumulated
significant experience in the form of indication-specific
net selling-price arrangements, both at the national
and at the sub-national levels
• There is also a need to consider the dynamic-pricing
case, given the interest in adaptive pathways
18. AES 2016
To enquire about additional information and analyses, please contact Dr. Jorge
Mestre-Ferrandiz at jmestre-ferrandiz@ohe.org
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