Pharma Panel Grapples With Drug Pricing, Real-World Evidence, and Creating Headroom for Innovative Therapies

During the FT Global Pharmaceutical and Biotechnology Conference, held this week in London, United Kingdom, a panel of executives from pharmaceutical companies, together with a scientist whose focus is on economics, discussed the increasingly challenging problem of paying for innovative therapies, particularly in a context of heightened political pressure around high drug costs. 
Kelly Davio
November 12, 2019
Gene therapies and other high-cost, single-dose treatments designed for patients with serious unmet medical needs have the potential to create transformative outcomes for patients, but only if patients have access to those treatments. During the FT Global Pharmaceutical and Biotechnology Conference, held this week in London, United Kingdom, a panel of executives from pharmaceutical companies, together with a scientist whose focus is on economics, discussed the increasingly challenging problem of paying for innovative therapies, particularly in a context of heightened political pressure around high drug costs. 

Kicking off the discussion was Ilona Torontali, global head of the access center of excellence for pricing, health technology assessment, evidence, and policy at Roche. According to Torontali, now more than ever before, it is crucial for drug makers to consider market access, particularly in terms of what data are needed, beyond those generated for regulatory submissions, in order to help health technology assessment bodies and payers understand the value of innovative therapies.

At the same time, innovative pricing models are needed to handle curative treatments, which are unlike more typical long-term therapies, and drug makers need to help systems evolve to be able to handle real-world evidence so that innovative contracts can be put in place for these drugs. That is particularly true for outcome measures that matter to most to patients, not just to payers or to regulators.

Also speaking from the drug makers’ point of view was Yvonne Greenstreet, MBChB, MBA, chief operating officer of Alnylam Pharmaceuticals. Alnylam makes the drug patisiran (Onpattro) that treats hereditary transthyretin amyloidosis.

Greenstreet explained that her company is embracing the concept of pay-for-performance contracting, because if innovations are not available to patients, there is little point in developing them. But if an expensive technology can deliver significant value to patients, pay-for-performance can be a way to make those innovations available.

To that end, generating real-world evidence is important to justify the value proposition of such therapies. “Really being able to assess how medicine perform in the real world is…incredibly important. Then you can link that to outcomes-based [models].”

Justin McCarthy, JD, senior vice president of the patient and health impact group at Pfizer, highlighted the fact that political pressure on drug pricing is particularly intense in the current US climate, and that fact is unlikely to change as advances in science continue to lead to precision medicines that are being introduced into systems that are under increased financial pressure.

He also said that advances in science have not been paralleled by innovations in payment models. Given that trends in medical innovation are here to stay, trends in reimbursement will need to keep pace.

McCarthy also addressed in particular the legislative solutions currently being explored to control high drug prices in the US market. In McCarthy’s view, the challenge related to HR 3, which the Congressional Budget Office has said will save the government money but that detractors have said will result in fewer new medicines each year, is less about tradeoffs between affordability and innovation and more a question of the kinds of innovations that will be developed in the future.

“If the rewards aren’t there…that capital can flow elsewhere,” he said. If there is a scaling back of capital from very high-cost drugs, then industry may shift toward developing more conventional—less precision—drugs.

In order to develop much-needed headroom for new innovation, McCarthy said that more efficient use of generics and biosimilars will be key.

There exists “huge potential to increase the uptake in biosimilars, [and] biosimilars can have a regulating effect” on the trend toward specialty medicines. Coupling the use of these cost-saving products with digital tools, like algorithms that can help predict which patients will gain the most benefit from precision therapies, will help with cost and with delivery.

Weighing in from a health economics perspective was Mark Trusheim, MS, strategic director of the NEWDIGS program at the Massachusetts Institute of Technology Center for Biomedical innovation. Trusheim has been vocal about his view that biosimilars are not, in fact, a solution for high drug costs in the US context, and has instead argued that off-patent brand-name biologics should have their prices regulated by the government.

According to Trusheim, at the NEWDIGS program, which brings together global leaders in a program that designs, evaluates, and initiates advancements that are too complex to be addressed by individual organizations, “we also believe deeply that you have to have downstream innovation.”

The organization is advancing the concept of precision financing to go along with precision medicine, and real-world evidence will help with the challenge of delivering ultra-orphan products for which clinical trial data may not be fully mature. Such evidence will help stakeholders as they devise value-based agreements, he said, and help all interested parties better understand the financial implications of using innovative products.

For pharma, “this is a huge opportunity for better communication and actual collaboration,” said Trusheim, because data typically reside with the payer and the provider. “It’s not just about conflict. It’s about putting in place the capabilities” that are needed to deliver these innovations to the patients who need them.

Trusheim also sees generation of real-world evidence as having an important additional benefit for companies that face pressure to justify high drug prices; while there is ongoing discussion about building trust with the public, Trusheim says that even more important than trust—which he suggested implies baseless faith—is establishing credibility, based on evidence, that will lead to public confidence.  

 

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