What if: A sliding scale were used to reimburse generic drugs to effectively drive down prices?

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Aidan Hollis University of Calgary July 2011

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This webinar presentation addresses current drug pricing trends and strategies plan sponsors can implement to offset rising drug costs through improved PBM contracting. The webinar was presented by Molly Breimhorst, PSG's Vice President of Financial and Analytical Services. Molly brings more than 14 years of PBM pricing experience, which includes leading the pricing and underwriting team for one of the largest PBMs in the country.

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You are an employee at Novartis. The company is currently addressing potential exclusions from formulary due to the introductions of generic versions as well as the introduction of other branded competitors. The company would like to develop a budget impact analysis and understand the budget impact in the treatment of Newly diagnosed adult with Philadelphia chromosome positive chronic myeloid leukemia (Ph+ CML) in chronic phase for both the Commercial and Medicare populations. You are tasked with developing this analysis as an economic model and providing your senior management with the budget impact and per member per month (PMPM) impact for both payer types. Additional key question to answer: What is the discount needed to stay cost neutral with generic versions as well other branded products that fall within the same therapeutic class (tyrosine kinase inhibitors) of the market uptake that must occur such that the budget impact to payers exceeds $0.05 PMPM at 3 years? DMS：Dasatinib Dosing: One pill, once daily, either in the morning or in the evening Dosing is the same for both newly diagnosed and imatinib-resistant or -intolerant CP Ph+ CML patients. For patients taking Dasatinib 100 mg daily, a dose decrease to 20 mg should be considered. Novartis: : Tasigna® (nilotinib) Dosing：300 mg TASIGNA® (nilotinib) capsules doses should be taken approximately 12 hours apart. Adult patients should take 2 capsules in the morning and 2 capsules in the evening Capsules should be swallowed whole with water Patients must avoid food for 2 hours before and 1 hour after each dose For patients who cannot swallow TASIGNA capsules whole, the contents of each capsule may be sprinkled in 1 teaspoon of applesauce (puréed apple). The mixture should be swallowed right away (within 15 minutes) and should not be stored for future use indicated population Comparators--Dasatinib Model feature DescriptionNotes Perspective and audiencepayers NovartisPopulation Commercial and MedicareIndication The worldwide annual incidence of CML is approximately 1–1.5 in 100,000 persons.In United State, 8990 people were diagnosed with CML in 2019.Time horizon5 yearsCost $16470/50mgThe cost for Tasigna oral capsule 50 mg is around $16,470 for a supply of 120 capsules, depending on the pharmacy you visit Drug brand/genericDose frequencystrengthDoses per administration/yearAverage Wholesale Price (AWP) Nilotinib(Tasigna)brandDaily 400mg2/365$196,473Dasatinib(Sprycel)brandDaily 100mg1/365$185,932Imatinib(Gleevec)brandDaily 400mg2/365$145,764Bosutinib(Bosulif)brandDaily 500mg1/365$204,706Ponatinib(Iclusig)brandDaily 45mg1/365$238,478 Comparators Feature Product of NovartisProduct of DMSBenefit designMedicalMedicalPatient cost-sharingCo-insurance(initial coverage phase:25% to 33%-coverage gap phase: 45%-50% coinsurance)Co-pay (driven from 4171 to 16684) Mode of administrationOrally twice dailyOral once dailyDuration of treatmentChronic(18.4 months)Chronic(15 months ...

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