adaptive pathways as incentives for innovation

Is There a Viable Commercial Strategy for the Use of Adaptive Approaches, Now and in the Future?

Adrian Towse

Workshop on Medicines Adaptive Pathways: A Practical Strategy to Improve Patient Access to Medicines?

Centre for Innovation in Regulatory ScienceLondon • 1-2 October 2014

CIRS Workshop on Medicines Adaptive Pathways • 1-2 October 2014 2

• A viable commercial strategy that meets HTA requirements?

• Can adaptive licensing increase expected net present value (eNPV)?

• Baird et al. (2013)

• Industry perceptions of current EMA pathways

• Escher Report (Boon et al., 2014)

• Role of managed entry agreements?

• Handling uncertainty

• Future scenarios for the EU and the US for RE/CER

• Conclusions

Agenda


A viable commercial strategy that meets HTA requirements?

• eNPV depends on revenues, costs, success rates, discount rates (and therefore timing of revenues and costs)

• Do adaptive pathways improve eNPV?• Depends on prices, volumes, costs, timing, success

rates

• What is the counter factual / comparator?• We seem to be on a path to making the economics

of drug development unsustainable


Baird et al. (2013) Comparison of stakeholder metricsDrug Scenario eNPV

US$Adaptive-

nessScore

Change in

Patient Access years

Inappro-priatelytreated patients

Comments

Zelboraf 1:Traditional $23m NA NA -(skin cancer)

2: Actual $34m 5 9100 -3: Adaptive $30m 10 9100 - As per fast track but with

continuous planned data collection

Gilenya 1: Actual $127M NA NA -(relapsing MS)

2: Staged $169M 12 41,000 - Smaller quicker trials for narrower authorisation. Later expansion of label

Acomplia(anti-obesity)

1:Actual ($73M) NA NA 0.9M Withdrawn in EU after 2 years, never approved in the US

3: Post MarketSurveillance

($43) 13 11.5M 1.7M Controlled for off label, adherence, maintained over life cycle

5:Staged ($16M) 16 10.1M None Smaller quicker trials for narrower authorisation. Later expansion of label. Controlledfor off label, adherence, maintained over life cycle


Boon et al. 2014 Escher Report*• CMA is granted on the base of less comprehensive data, but

assessment timelines were longer. CMA is perceived as a ‘rescue option’ by regulators and companies, rather than as a prospectively planned pathway to provide early access.

• Of the cohort of 47 NASs approved in 2007, at least one PASS was requested at market entry for 22. Yet PASSs are not the main source of new safety information listed in the SmPC, but the costs of conducting these studies appear substantial.

• ‘Adaptive licensing has been discussed for a long time with very little action . . . new regulatory pathways will only be useful if they are considered in a holistic approach including health technology assessment (HTA) and payers’. Furthermore, the importance of ‘understanding the business needs for new pathways’ is stressed.

*Improving the EU system for the marketing authorisation of medicines. Learning from regulatory practice. Escher Foundation


The story so far. . .• Modelling suggests adaptive licensing can improve eNPV,

increase overall numbers of patients treated, but also do the opposite

• The CMA does not seem to be working in the way intended

• Some PASS schemes may not be a good use of resources.

• Industry interest in adaptive pathways but concern about lack of HTA / payer ‘buy in’

• Need a coordinated EMA HTA/payer approach


• MEAs are used to give access to new technologies where traditional reimbursement is deemed inappropriate

• Three different forms of MEAs have been identified:

• Management of uncertainty relating to clinical and/or cost-effectiveness

• Management of utilization to optimize performance

• Management of budget impact.

• The rationale for using these approaches and their advantages and disadvantages differs

• All forms of MEA should take the form of a formal written agreement among stakeholders, clearly identifying the rationale for the agreement, aspects to be assessed, methods of data collection and review, and the criteria for ending the agreement.

Managed Entry Agreements*

*Klemp, Frønsdal and Facey on behalf of the HTAi Policy Forum (2011) IJTAHC 27: 77-83


Categorising Payer Options

Payer options:

Payers adopts: no new evidence required

(YES)

Payer refuses to adopt. (NO)

Payer adopts with additional evidence (CED) (YES BUT)

CED with renegotiation. No

pre-specifiedagreement

CED linked to performance agreement

Reapply with a price

cut

Manufacturer has the option to

reapply with more evidence


ISPOR Performance-Based Risk-Sharing

Task Force

Performance-Based Risk-Sharing Arrangements—Good Practices for

Design, Implementation, and Evaluation

Garrison, L.P., Towse, A., Briggs, A., de Pouvourville, G., Grueger, J., Mohr, P.E., Severens, J.L., Siviero, P. and Sleeper, M. (2013 Report of the ISPOR Good Practices for Performance-based Risk-sharing Task

Force. Value in Health. 16(5), 703-719.


Performance based risk sharing arrangements (PBRSA)

To manage utilization in the real world

To provide evidence regarding decision uncertainty

- Outcomes guarantees- Money back guarantees- Conditional treatment continuation

Cost sharing arrangement

- Budget capping- Utilization capping- Discounts- Price/volume

MEA: Payer-producer/provider

arrangement

Coverage with evidence development

Performance linked reimbursement

Intermediate endpoint

Clinical endpoint

- Only with research

- Only in research

- Process of care

Pre-specified agreement

No pre-specified agreement


MEAs / PBRSAs: lessons and challenges

• Study design has to address the uncertainty

• Observational, PCTs, RCTs, use other jurisdictions

• Transaction costs are key barrier:

• Mostly evidence collection

• Pre-agreement covering adjustment and exit

• Challenge of Price flexibility?

• Price per unit of health gain, not per pill

• Withdrawal of (or increase in) discounts rather than change in list price

• Differential pricing by indication

• Retrospective price adjustment / rebate/ premium


Addressing uncertainty

• Uncertainty only matters if decision makers can do something about it

• Concentrate on the expected value

• PBRSAs offer a route to address uncertainty with additional evidence collection

• Discount if data collection possible, but no willingness to undertake it

• Incentives matter – it is a ‘repeat game’

MOVEMENT TOWARD HARMONIZATION IN EUROPE

Post-authorisation efficacy studies (PAES) implemented

Greater HTA and EMA coordination pre-launch

Disease registries in some countries , and progress in EHRs

Coordination across HTA bodies in demand for P-L studies, often linked to CED, P4P schemes

Collaborations across large registriesFull use of EHRs Good progress in methodsPublic-private partnerships have a major role

AL applied to a variety of drugsJoint HTA and EMA coordination for pre-and post- launch

Most Likely Scenario

Most ConduciveTo RE Scenario

Anticipating the future for CER and RE in the pharmaceutical industry. Research conducted by CMTP and OHE, sponsored by Amgen, GSK, Lilly, Novartis, Sanofi. Publications in progress.

MOVEMENT TOWARD INTEGRATION OF HEALTH SYSTEM IN THE US

ACA and private payers driving investment in ACOs

Increasing data systems ability to produce quality measures Federal investments to

improve research infrastructure/methods/processes

Risk-based payments move towards capitation

Increasing willingness and ability to invest in EHRs and desire to reduce system costs

Changing locus of decision-making providing opportunitiesfor new partnerships

Most ConduciveTo CER Scenario

Most Likely Scenario

Anticipating the future for CER and RE in the pharmaceutical industry. Research conducted by CMTP and OHE, sponsored by Amgen, GSK, Lilly, Novartis, Sanofi. Publications in progress.


Implications of the scenarios • Key drivers for Europe are:

• HTA coordination

• Regulatory innovation (PAES, adaptive licensing)

• Regulatory / HTA interaction

• Data availability / methods evolution

• In the US:

• No regulatory reform / interaction with payers

• Data generation and integration are key drivers

• Early US access requires an EU response:

• Adaptive pathways offer such a response

• Use US post-launch evidence in EU and vice versa?


• The commercial model for an adaptive pathway requires:

• Coverage with evidence development (MEAs/PBRSAs)

• Pricing/use flexibility

• Adaptive pathways require a transformation in evidence collection costs through EHRs, disease registries, and methods evolution

• Regulatory/HTA body/company interaction post-launch is going to be key

• Use of the PAES must be linked to MEA/PBRSA requirements

• The alternatives to using adaptive pathways are not easy options, either.

Conclusions


To enquire about additional information and analyses, please contact Adrian Towse at [email protected].

To keep up with the latest news and research, subscribe to our blog, OHE News

Follow us on Twitter @OHENews, LinkedIn and SlideShare

The Office of Health Economics is a research and consulting organisation that has been providing specialised research, analysis and expertise on a range of health care and life sciences issues and topics for more than 50 years.

OHE’s publications may be downloaded free of charge for registered users of its website.

Office of Health Economics Southside, 7th Floor105 Victoria StreetLondon SW1E 6QT United Kingdom

+44 20 7747 8850 www.ohe.org

©2014 OHE

About OHE

mailto:[email protected]

http://news.ohe.org/

http://twitter.com/OHENews

http://www.linkedin.com/company/office-of-health-economics?trk=hb_tab_compy_id_1749728

http://www.slideshare.net/OHENews

http://www.ohe.org/

adaptive pathways as incentives for innovation

Health & Medicine