A new OHE Research Paper reviews a recent report on cancer pricing published by the World Health Organization. The authors argue that the report fails to promote mechanisms that are key to efficient pricing and use of cancer medicines. The Research Paper outlines some for addressing these shortcomings.
Transparency as a principle of good governance is not the same as transparency for improving access by lowering prices. In fact, the former often carries an opportunity cost on the latter. Developing country markets are, however, dominated by generic products and encouraging competition through sharing prices makes sense if capacities are there to use the data to inform procurement decisions and protect against collusion.
Report does not recommend price transparency for on-patent medicines, but buyers should share multi-source product price data among themselves. Transparency of the procurement process encourages bidders. In many cases, referencing processes and institutions may be a safer bet than trying to copy each other’s prices.
Value-based pricing (VBP) is an efficient method for pricing new drugs. Rate of return pricing could, however, be useful in two cases: treatments for ultra-rare diseases, and ‘cures’ for conditions currently being treated at great expense. Rate of return pricing gives rise to challenges. Two are (i) finding proxy estimates of development costs including failures, and (ii) driving future research towards discovering high-value treatments.
The Japanese government has recently announced new plans to implement HTA from April 2019. The ISPOR HTA Task Force published ‘Good Practices in HTA’ in January 2019. The Japanese proposals do not meet them.
The combination of rising drug costs in the US and increasing financial stress for individual patients has triggered intense national concern. One target has come under particular scrutiny: rebates. A new report published by ICER and the OHE describes how alternatives to the current rebate system offer potential disadvantages as well as potential benefits. It outlines evidence presented to date and key questions that still need to be answered.
Making Outcome-based payments a reality in the NHS authored by The Office of Health Economics, RAND Europe, King’s College London, and Cancer Research UK, and commissioned by Cancer Research UK in partnership with Greater Manchester Health & Social Care Partnership, explores alternative pricing models and the implications of outcome-based payment schemes for improving access to cost-effective cancer drugs.