The FDA Grapples With the Economics of Drug Development

The FDA is giving serious consideration to the economics of the drug or device development process, and to that effect, has released a draft guidance for manufacturers on how and what to communicate with payers and formulary committees.

The document, “Drug and Device Manufacturer Communications With Payors, Formulary Committees, and Similar Entities—Questions and Answers,” elaborates on what kind of healthcare economic information (HCEI) can and cannot be communicated by medical product manufacturers, packers, distributers, and their representatives to payers and formulary committees at healthcare organizations. A very important aspect of this document is sharing information on investigational new drugs and devices with payers before approval or clearance.

Acknowledging that in addition to the efficacy, safety, and cost-effectiveness, payers seek information that can help them make decisions on developing and managing their formulary as well as coverage and reimbursement decisions, the document states that HCEI is important for payers, and therefore, should be “truthful and non-misleading.” To that effect, section 502(a) of the Federal Food, Drug, and Cosmetic Act includes information on communication of HCEI about approved drugs to payers.

Addressing the case of investigational drugs and the need for payers to plan and finalize coverage decisions in anticipation of a new drug or device being approved is section III.B of the draft guidance, which details the FDA’s thoughts on such communication between manufacturers and payers. This includes recommendations about ensuring the information is truthful and does not mislead payers.

Another guidance released by the regulatory body, “Medical Product Communications That Are Consistent With the Food and Drug Administration-Required Labeling—Questions and Answers,” is specifically geared for manufacturers to understand how the FDA reviews and evaluates their product communications, including promotional materials.

The guidance outlining appropriate manufacturer—payer communication is open for comments for a period of 90 days from January 19, 2017, which is the date of the documents publication in the Federal Register.

“The draft guidance released this week broaden the types of truthful and non-misleading information that industry can share to inform payers as they budget, make coverage decisions, and select drugs for a large number of patients," Jennifer Graff, PharmD, vice president for Comparative Effectiveness Research at the National Pharmaceutical Council, said. "These population health decision-makers need timely clinical, and economic information to improve our healthcare system and patient outcomes.”

She added that sharing meaningful clinical and economic information that impact healthcare decisions should be accessible to all stakeholders.