Video
Dr Steven Pearson on Analyzing the Long-Term Benefits of New Drugs
When pricing new drugs, it’s difficult to understand how their performance will play out in the long term, and for that reason, Institute for Clinical and Economic Review (ICER) has created models that predict future costs and benefits, said Steven Pearson, MD, MSc, FRCP, founder and president of ICER.
When pricing new drugs, it’s difficult to understand how their performance will play out in the long term, and for that reason, Institute for Clinical and Economic Review (ICER) has created models that predict future costs and benefits, said Steven Pearson, MD, MSc, FRCP, founder and president of ICER.
Transcript (modified)
ICER’s report on the new PCSK9s found that these treatments should be priced significantly lower. What goes into these analyses?
One of the tricky parts of looking at the evidence on any healthcare intervention, but especially ones that are relatively new, is that we often have a fair amount of uncertainty about their true clinical performance, both their long-term benefits and also their risks. So part of what we do in looking at this information is to try to make sure that we analyze as best as we can all of the existing information in the short term about benefits and risks.
But to look at long-term clinical effectiveness and value we have to kind of span that out, so we create a computer model that plays out what the different clinical benefits and costs might be over the long term. And that becomes an important anchor when we’re talking about value because often you’ll find that interventions, even if they’re quite expensive even in the short term, may turn out to have a very good value in the long term if they prevent hospitalizations, or doctor’s visits, or clinical complications, those kinds of things.
So with the PCSK9 inhibitor drugs, their short-term use does lead to prevented heart attacks and other outcomes if you model out the clinical expectations. But according to our analysis, the extra added cost at the list price, even over the long haul, makes them a very poor value in terms of relative amount of extra cost we would need to spend in order to get a certain patient benefit. So in our analysis, the long-term value looked poor, and then we also looked at the potential short-term budget impact.
High cholesterol is a very common condition and we looked at an analysis that suggested that even if only 20% of eligible patients took the drugs over the first 5 years—because you know patients don’t always take the new drug right away—but if they ramped up and used the drugs over 5 years, then the cost of the US healthcare system would be over $100 billion. And to try to capture that element of value to the healthcare system, we used that to come up with a part of our value-based price benchmark as well.
