Performance based risk sharing arrangements for prescription medicines


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  • The above graph provides an overview of the number and variation of scheme types by country.
  • The slide above provides a case example for the innovative pricing scheme implemented in Australia for Bosentan in the treatment of Pulmonary Arterial Hypertension.
  • Performance based risk sharing arrangements for prescription medicines

    1. 1. Performance Based Risk Sharing Arrangements: How Well Does CER/RE Do? Professor Adrian Towse Director, Office of Health Economics Mid-Year Symposium International Society of Pharmacoepidemiology 11-13 April 2013 ● Munich, Germany 1
    2. 2. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    3. 3. Performance Guarantees Are Not New …..
    4. 4. What Is a PBRSA?• PBRSA = Performance-Based Risk Sharing Arrangement• Also known as: • Coverage with evidence development (CED) • Managed entry schemes (MES) • Outcomes-based schemes • Risk-sharing agreements • Access with evidence development • Patient access schemes (PAS) • Conditional licensing • Pay-for-performance programs • Innovative pricing • And others?
    5. 5. PBRSA—Working Definition• Includes a program of data collection• Data collection is typically initiated during the time period following initial regulatory approval• Price, reimbursement, and/or revenue are linked to the outcome of this program of data collection (explicitly or implicitly )• Data collection is intended to address uncertainty• These arrangements provide for a different distribution of risk
    6. 6. Performance-Based Schemes by Year Performance-based Schemes by Year 140 120 100 Total Schemes: 121Number of Schemes 80 60 40 20 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Schemes Source: University of Washington database
    7. 7. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    8. 8. Categorising Payer Options PAYER OPTIONS Payers adopts: no Payer refuses to Payer adopts with new evidence adopt (NO) additional evidence required (YES) (YES BUT) Non-outcomes PBRSA related scheme (Outcomes related scheme)Source: Adapted from Towse, A. and Garrison, L.P. (2010)
    9. 9. 12
    10. 10. Performance-based schemes between health care payers and manufacturers Non-outcomes based Health outcomes-based schemes schemes Population level Patient level Conditional coverage Performance-linked reimbursement (PLR)Market Price Coverage with Conditional treatment Outcomes Pattern orshare volume evidence continuation (CTC) guarantee process of care development (CED) [Ex: Alzheimer’s drugs in [Ex: OncotypeDx in Italy] US (United Healthcare)] Utilization Manufacturer caps funded treatment Only in research Only with initiation [Ex: Cochlear research implants in US [Ex: Risperidone Clinical Intermediate (CMS)] in France] Endpoint Endpoint [Ex: [Ex: Simvastatin in Bortezomib in US] UK] Source: Carlson et al. (2010) 13
    11. 11. Why the Uncertainty?• Efficacy to effectiveness issues • Comparator • Population mix / base line risk • Health care setting • Longer term outcomes• This is CER/RE territory
    12. 12. A Value of Information (VOI) FrameworkWhen is a PBRSA worthwhile?A payer has four major options: 1. Adopt 2. Refuse to adopt 3. Mandate a lower price 4. Enter into a PBRSA that is either a. is a form of CED where evidence is collected across patients for review. b. Performance-linked reimbursement at the patient level
    13. 13. PBRSAs in a VOI Framework• Use while evidence is collected is attractive but issues of 1. Ability to collect evidence and use at the same time – solution is use only in research or to collect in another jurisdiction 2. Risk of payer wasted money/lost health gain 3. Irreversibility – difficult to change practice/withdraw product• Pre-agreement increases the options • Can agree rebates and/or price/use adjustment
    14. 14. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    15. 15. Payer-producer/provider arrangement Cost sharing Performance based risk sharing arrangement arrangements To manage utilization in the To provide evidence regarding real world decision uncertainty Performance linked Coverage with evidence reimbursement development - Outcomes - Budget capping guarantees - Process of - Only with - Only in - Utilization capping - Money back care research research - Discounts guarantees - Price/volume - Conditional treatment continuation Intermediate endpoint Pre-specified agreement Clinical endpoint No pre-specified agreementSource: ISPOR Task Force
    16. 16. Dimensions and differences• Non-health outcomes versus health outcomes• CED versus performance linked reimbursement• Pre-agreement versus ‘renegotiation’• Only with research (OWR) versus Only in research (OIR)
    17. 17. Examples of PBRSA Schemes Performance based risk sharing arrangements To manage utilization in the To provide evidence regarding real world decision uncertainty Performance linked Coverage with evidence reimbursement development - Outcomes - Only with- Budget capping guarantees - Process of - Only in- Utilization capping care research research - Money back UK: MS RSS- Discounts guarantees Aus: Bosentan- Price/volume Italy: oncology schemes - Conditional UK: Votrient US Medicare: UK: Velcade, Lucentis treatment France: LVRS, PET, PTAS continuation glitazones, risperido ne Intermediate endpoint Pre-specified agreement Clinical endpoint No pre-specified agreement Source: Adapted from ISPOR Task Force
    18. 18. Examples of Agreements by CategoryPerformance linked reimbursement including tacklingsubgroup uncertainty (i.e., will the right people get the drug?)• Response uncertainty. The UK Velcade example tackles subgroup uncertainty, ensuring identification of responders. The Italian oncology schemes use this approach • UK Lucentis (dose-capping) arrangement for macular degeneration could be seen as the NHS addresses outcome uncertainty by capping the price it paid for an outcome
    19. 19. Examples of Agreements by Category (cont.)Coverage with Evidence Development• UK multiple sclerosis (MS) drugs scheme• Australian Bosentan agreement linking price to patient survival• French risperidone linking compliance to fewer hospital admissions• French studies on (‘gliptins’) for patients with T2 diabetes (ongoing) and glitazones to delay escalation to insulin therapy
    20. 20. Performance-Based Scheme Components by Country 50 45 40 35Number of Schemes 30 25 20 15 Total Schemes: 121 10 5 0 CED PLR CTC FUCED: Coverage with evidence development; CTC: Conditional treatment continuation; PLR: Performance linkedreimbursement; FU: Financial or utilization based agreements*Note: Multiple schemes had multiple performance-based components Source: University of Washington database 23
    21. 21. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    22. 22. UK Multiple Sclerosis Risk Sharing Scheme: Test Case or Interesting Anomaly?
    23. 23. Multiple Sclerosis Drugs in the UK• NICE reviewed MS drugs for relapsing-remitting multiple sclerosis in 2001 • 5 year model: £380,000 to £780,000/QALY • 10 year model: £190,000 to £425,000 • 20 year model: £40,000 to £90,000 • ‘On the balance of costs and benefits, the beta interferons and glatiramer acetate are not cost-effective’• Dependent on long-term outcomes: only two years of follow up data • Used assumptions and historical control to estimate long-term outcomes • Estimates sensitive to the impact of a relapse on quality of life and the time horizon over which benefits may be accrued.
    24. 24. Multiple Sclerosis Drugs in the UK (cont.)• Performance-based scheme development • Detailed monitoring over 10 years of a cohort of patients to confirm the CE of the MS treatments: Avonex, Betaferon, Copaxone and Rebif • Treatments initiated by specialist MS centres based on ABN guidelines • No bar to clinicians prescribing for patients outside the guidelines • Outcome measure is Expanded Disability Status Score • Actual outcomes reviewed every 2 years against standard MS disease (non-treated) progression model through the EDSS scale • Price adjustment to maintain CE threshold at £36,000/QALY • PLR, outcomes guarantee• Handling uncertainty: • Resolve residual uncertainty related to long-term outcomes • Mitigate negative consequences of uncertainty about value
    25. 25. Multiple Sclerosis Drugs in the UK (cont.)• Prospective cohort study with historical comparator with 2 year follow up using EDSS **• ‘The outcomes so far obtained in the pre-specified primary analysis suggest a lack of delay in disease progression ** • Prices were not adjusted downward as evidence was not conclusive. Issues: • design of the study and time delays generating evidence • the enforceability of the contract link between prices and outcomes • problems of governance vigorously defended by chair • usefulness of the EDSS as the outcome measure • impact on the choice of comparator when evaluating subsequent new drugs for the same indications.
    26. 26. Bosentan for PAH in Australia• Effectiveness • Two small phase III trials: benefit in trials confined to HR-QoL measures and intermediate markers • Six-minute-walk test• Budget impact/patient population considerations • High cost, small patient population. • Potential to continue treatment despite lack of benefit  no alternatives• Value/CE • Assumed mortality risk was key driver in cost-effectiveness model • Assumed link between six minute walk test and mortality • ICER was accepted with a risk sharing agreement 29
    27. 27. Bosentan for PAH in Australia (cont.)• Model assumed 5.2% for iPAH: $61,594 ICER cost/YOL• Registry showed • observed mortality rate in iPAH and APAH SSc were 11.8% and 16.6% respectively • for iPAH only this was an ICER of $80,735 (need a price cut of 23.7%) • adjusted to match RCT popn 8.8% and 14.12% respectively • weighted observed iPAH (58%) and APAH SSc (42%) was 13.6% • weighted adjusted iPAH (58%) and APAH SSc (42%) was 11.3%: $64,427 ICER cost/YOL (need a price cut of 4.4%)• Another oral ERA was listed in 2008 at a 15% price discount• PBAC requested same discount. Actelion agreed. No further price reductions sought as a result of the risk share.
    28. 28. Examples of Schemes in France• Risperidone used a sophisticated case-control design with the preliminary construction of a historic control cohort matching patients treated by risperidol, and then a parallel follow-up after the introduction of the long lasting form.• Glitazones methodology required selecting a panel of GPs and asking them to include prospectively patients who failed on metformin mono-therapy and switched to bi-therapy. GPs were free to use either gliptines or sulfamides and were to follow up patients for three years. Source: Gérard De Pouvourville
    29. 29. Votrient (Pazopanib) in UK• 12.5% discount on Votrient s list price • Price parity with Sutent (a monthly cost of just under GBP2,000 (US$3,085) per patient)• Future financial rebate if Votrient proves inferior to Sutent with regards to its efficacy, in ongoing head-to-head trials • Exact scale of the potential rebate not disclosed• The results of the COMPARZ study reported in October 2012 and showed non-inferiority in PFS
    30. 30. Source: Paolo Siviero, AIFA
    31. 31. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    32. 32. Evidence from the Literature• Puig-Peiro et al. (2011) conducted a systematic literature review to identify existing knowledge about the costs and benefits of PBRSAs, assessed either quantitatively or qualitatively. Found little quantitative evidence• Neumann et al. (2011) reviewed five PBRSAs in the US and UK and concluded that they are difficult to implement in practice• The results from Italy and other EU countries also are unclear and the schemes are evolving• Overall, the literature suggests an important gap in structured ex post evaluation of PBRSAs. Utilisation schemes appear to have been more successful to date than CED schemes. However, the evidence is limited, mixed, qualitative, and partial
    33. 33. Agenda• What are ‘risk-sharing arrangements’?• Why are payers and manufacturers entering into them?• A categorisation• Experience of study approaches• Success or failure?• Good practice
    34. 34. Task Force Focus: Four Good Practice QuestionsQ1. Desirability: Is a PBRSA the appropriate way forward giventhe uncertainty and the alternative methods for reducing thisuncertainty?Q2. Evidence collection: Which PBRSA research design is mostappropriate to collecting evidence that addresses the relevantuncertainties?Q3. Implementation: How should a PBRSA beimplemented, governed, and reported? Q4. Evaluation: Has the PBRSA achieved its objectives? Was itgood value from a health system perspective?
    35. 35. Research Design Options• Research Design Options will include • Traditional targeted randomized clinical trial (RCT), focusing on efficacy • Large pragmatic clinical trial (PCT), randomized but with less rigorous entry inclusion or exclusion criteria • Prospective observational study of patients without randomization • Hybrid design that includes observational cohorts and retrospective data• In any case: need to balance scientific validity, real world relevance, cost and time
    36. 36. Type of Evidence Collection• The design choice will depend on the uncertainty that the PBRSA evidence collection is trying to address: • Uncertainty around whether the medical product or service will be used in the right patients (not all patients may respond, effectiveness and cost-effectiveness differs across indications or groups of patients) • Uncertainty at launch around clinical or economic outcomes (effectiveness vs. efficacy, final outcomes vs. surrogates, or about size of cost offsets)
    37. 37. Alternatives to PRSAs1. Options for payers at launch • Adopt now--no further evidence collection • Get it right the first time. Dialogue with regulators and HTA bodies will help. Hard to resolve all uncertainties at launch • Delay adoption and collect further information • Lose benefits of access2. Greater use of Adaptive Licensing increases PBRSA importance as a framework for CED3. Coverage with evidence development with no agreement will become less attractive • Renegotiation with additional information but • no commitment to information collection • no commitment how new evidence will be used
    38. 38. 42
    39. 39. ReferencesCarlson et al. (2010) Linking payment to health outcomes. Health Policy. 96(3), 179-190.Neumann, P.J. et al. (2011) Risk-sharing arrangements that link payment for drugs to healthoutcomes are proving hard to implement. Health Affairs. 30(12), 2329-2337.Puig-Peiró, R., Mestre-Ferrandiz, J., Sussex, J. and Towse, A.(2011) Literature review on PatientAccess Schemes, Flexible Pricing Schemes and Risk Sharing Agreements for medicines. Paperpresented at ISPOR 14th Annual European Congress. Madrid, Spain. 5-8 November.Towse, A., Garrison, L. and Puig-Peiró, R. (2012) The use of pay-for-performance for drugs: Can itimprove incentives for innovation? Occasional Paper. 12/01. London: Office of Health Economics.Towse, A. and Garrison, L.P. (2010) Can’t get no satisfaction? Will pay for performance help?Toward an economic framework for understanding performance-based risk-sharing agreementsfor innovative medical products. Pharmacoeconomics. 28(2), 93-102.
    40. 40. To enquire about additional information and analyses, please contactProf Adrian Towse: atowse@ohe.orgTo keep up with the latest news and research, subscribe to our blog, OHE News.Follow us on Twitter @OHENews, LinkedIn and SlideShare.Office of Health Economics (OHE)Southside, 7th Floor105 Victoria StreetLondon SW1E 6QTUnited Kingdom+44 20 7747 8850www.ohe.orgOHE’s publications may be downloaded free of charge for registered users of its website.©2013 OHE