Drug Development/R&D

Since the Office of Health Economics (OHE) published a critique of CBO’s new simulation model of new drug development late last year, the U.S. public sector think tank has made three improvements to its methodology. We review these updates, assess their impact, and highlight the key remaining limitations of the modelling approach, concluding that policymakers should still exercise considerable caution in relying on its predictions.

A new publication by Kourouklis and Gandjour (2022) investigates the impact of pharmaceutical spending on domestic early-stage pharmaceutical innovation in Europe. They find that European spending does impact the number of patent applications and that European pharmaceutical spending has an impact on European countries attracting early-stage development.

Professor Margaret Kyle will deliver the Annual Lecture of 2021 on October 14th, 2021, virtually.

The Value in Health May issue includes the paper “How Should the World Pay for a Coronavirus Disease (COVID-19) Vaccine?”. Finalised in December 2020, it includes: an overview of COVID-19 vaccine development; a proposal for a benefit-based advance market commitment (BBAMC) to get the vaccines needed; and proposals for future pandemic preparedness. In this blog, the authors update their thinking to take account of the events of the last 6 months.

In a commentary piece recently published in Applied Health Economics and Health Policy, OHE authors discuss how the misalignment in interpretations of the term ‘unmet medical need’ by different stakeholders has led to insufficient incentives for development in areas with urgent, genuine need, and propose a new framework for developing a more consistent understanding of UMN that will increase innovation.

This blog discusses the rationale behind a COVID-19 patent waiver decision and contributes to the current debate by producing a balanced view on the benefits and drawbacks resulting from an intellectual property (IP) waiver, in the short- and the long run. Moreover, it offers recommendations and alternatives for expediting global access to COVID-19 vaccines without waiving their IP rights.

A new paper, published last week in Applied Economics, by Dimitrios Kourouklis, Senior Economist at OHE, looks at the question of whether government funding increases public sector development of new medicines. Looking at public sector drug development in Europe, this paper suggests that government funding does have an impact on the research and development pipeline, particularly at the earlier stages of research for medicines targeting rare diseases.

OHE authors develop a supply and demand model of pharmaceutical markets to analyse the social welfare distribution between consumers (payers) and developers (industry) to set an optimal cost-effectiveness threshold (CET).

In place of OHE’s 2020 Annual Lecture, Adrian Towse will give a webinar-lecture on June 25th on payment models for a COVID-19 vaccine.

He will be discussing options for funding the development and manufacture of a vaccine, reflecting on their strengths and weaknesses, considering what may happen with no regional or global collaboration. Analysis will consider the work of Gavi and others to construct a global vaccine market that delivers for all citizens.

A COVID-19 vaccine is needed now, but timelines (12-18 months) create large market risk. By the time a vaccine is ready, the crisis may have passed. A CGD Note explores three options: business as usual – which may lead to promotion of an inferior vaccine or fierce country competition for supply – and two models (cost- or value-based), with countries pre-committing to purchases meeting specified efficacy. The authors prefer a value-based model.

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