NPC Submits Comments to ICER on Valuing a Cure Project

February 20, 2019

Steven D. Pearson, MD, MSc, FRCP
President
Institute for Clinical and Economic Review
One State Street, Suite 1050
Boston, MA 02109 USA

RE: Value-Based Pricing of Cures

Submitted electronically via: publiccomments@icer-review.org

 

Dear Dr. Pearson:

The National Pharmaceutical Council (NPC) shares your interest in promoting a dynamic, innovative health care system and in placing scientific methods of evidence analysis and transparency at the heart of value assessment processes. With this view in mind, NPC appreciates ICER’s call for public comments on the new Valuing a Cure project. [1]

NPC is a health policy research organization dedicated to the advancement of good evidence and science, and to fostering an environment in the United States that supports medical innovation. NPC is supported by the major U.S. research-based biopharmaceutical companies. We focus on research development, information dissemination, education and communication of the critical issues of evidence, innovation and the value of medicines for patients. Our research helps inform critical health care policy debates and supports the achievement of the best patient outcomes in the most efficient way possible.

Our comments below pertain to the three methodological questions outlined in the project announcement on January 23, 2019.

Characteristics of curative therapy

The answers to three questions asked by ICER are dependent on which therapies are considered “potential cures.” Rather than using clinical-based characteristics, NPC suggests “potential cures” be identified by the financial and value assessment challenges that they impose on the U.S. payer system by including these two characteristics:

  • Large upfront payment for multiple years of therapeutic benefit
  • Real-world efficacy and durability are uncertain at Food and Drug Administration (FDA) approval

These characteristics require that we perform value assessment and payment in a manner that differs from current approaches for the reasons stated below. Our responses below frame how value assessment needs to be adapted to accommodate this new class of therapies.

How should value-based prices for potential cures reflect substantial uncertainty regarding clinical safety and effectiveness due to limitations in study design, outcome measures, and the size and duration of clinical trials?

Due to clinical trial limitations, uncertainty will be much greater for curative therapies entering the market than for traditional therapies. One potential consequence of greater uncertainty on cost effectiveness is to underestimate the value of curative therapies (greater uncertainty plus conservative assumptions regarding clinical safety and effectiveness equal lower value-based price).

In addition, the small treatment population size for many of these therapies creates a second issue: Population-based estimates of value may have less relevance to payers as the experience of an individual payer is less likely to reflect the average experience (e.g., smaller payers may have only a single patient with the disease, which implies that the value of the therapy to that payer is likely to be greater or lesser than the average value across payers).

It should be noted that for these newer therapies, higher uncertainty around safety and effectiveness often is a function of the unmet need. Regulators, like the Food and Drug Administration and the European Medicines Agency, frequently accept Phase II data for approving oncology treatments because of this superior efficacy in a serious disease. In adapting their approach to the regulatory requirements and pathways (with post-approval studies, acceptance of real-world evidence, etc.), regulators have found a way to manage clinical uncertainty and make treatments available faster, without compromising their mandate of ensuring drugs are safe and efficacious. Similarly, systems for accelerated product valuation, and ultimately pricing and payment, should adapt to be more flexible to ensure rapid and appropriate patient access to these medicines.

Fortunately, payment techniques aimed at managing uncertainty are being developed by MIT NEW Drug Development ParadIGmS Financing and Reimbursement of Cures in the US, Alliance for Regenerative Medicine, Duke-Margolis Value-Based Payment Consortium, Network for Excellence in Health Innovation and others. [2,3] It is our recommendation that ICER take advantage of these developing payment approaches by incorporating their uncertainty mitigation strategies into value assessment. To achieve this goal, we recommend that ICER, in addition to the standard value estimate provided today, produce a table in the final report and Report-at-a-Glance that shows how the value of a therapy changes with duration of outcome response. A general example is provided below, but the outcomes of interest and duration of response in years would need to be customized for each disease. These tables should be updated as real-world data is captured and the value of each therapy is better understood.

ICER table

This proposed approach has two advantages. First, it improves the overall value assessment accuracy as it specifies uncertainty as a function of duration (stated in years) rather than rolling it up into a single number that assumes an expected duration of response. Second, it provides the value assessment results in a format that is easy for payers (a target end-user) to incorporate into value-based agreements, thus allowing payers to better manage their risk.

How should value-based prices for potential cures reflect uncertainty regarding inclusion of additional elements of value that may be important for potential cures, but which are not part of standard cost effectiveness methods?

The incorporation of the full benefits into value assessment is important. This is critical for “potential cures” as the magnitude and type of benefits produced are much greater than traditional medications. Examples include caregiver burden, productivity, potential mental health benefits for the patient, insurer value and tax benefits.

However, the science to accurately quantify the value of these benefits is likely several years away. In the meantime, below is a list of potential actions that ICER could take to recognize that there is a broad set of benefits that have not been fully incorporated into their analysis:

  • Potential cures provide an immense degree of benefit in addition to an individual patient’s health outcomes that go beyond traditional medicines. The impact of these treatments on society, including cost offsets outside of the health care system, are of great measure. Therefore, it is critical, per the Second Panel on Cost-Effectiveness in Health and Medicine and the ISPOR Special Task Force on Value Assessment Frameworks, that the societal perspective be presented as a co-base case rather than as a separate sensitivity analysis. Further, the societal perspective should be a standard part of the Reports-at-a-Glance for curative therapies. [4,5]
  • The planned case analysis should examine the various elements of value that are not traditionally captured in cost effectiveness. For each element, a range of monetized values should be tested to determine how it impacts the cost effectiveness results. The results of this analysis can be used to inform sensitivity analysis for drug reviews when these elements are present.
  • In addition, the other benefits and contextual considerations should be included in the Report-at-a-Glance. This discussion should include reasons why these considerations may justify a higher cost effectiveness threshold. For example, many potential cures will be considered ultra-rare orphan diseases and therefore should receive a higher cost effectiveness threshold per ICER’s current value assessment framework.
  • The Report-at-a-Glance should provide the results as a range rather than as a point estimate to highlight the greater uncertainty associated with curative therapies.

How should value-based prices for potential cures reflect extreme magnitudes of lifetime health gains and cost offsets that are far beyond those generated by traditional therapies?

Diseases fall on a spectrum of potential for life years gained and cost offsets; “extreme magnitudes of lifetime health gains and cost offsets” is not likely to be the common case. Specifically:

  • Therapies matching the “potential cures” profile that have come to the market to date have not seen the “extreme magnitudes” posed by this question.
  • Only a handful of therapies (e.g., outliers) that are forecasted to enter the market between now and 2030 are likely to have “extreme magnitude” of cost offsets or life gains. As a reference, MIT has developed a detailed analysis of possible therapies entering the market in the next 10 years. [6,7] This analysis can be used to estimate how frequently the “extreme magnitude” scenario will occur.
  • The handful of “potential cures” with “extreme magnitude” cost offsets or life gains will have small patient populations, meaning that the total budget impact will be small. The aforementioned MIT research can validate the population estimates for these therapies.

Given that the number of therapies with “extreme magnitude” cost offsets or life gains will be few and the total budget impact will remain small, NPC recommends that ICER uses the same process for all potential cures. This subset of “potential cures” represents the type of innovation that we should encourage.

 

We appreciate the opportunity to provide input on the key methodological questions associated with ICER’s new Valuing a Cure project. We look forward to continued dialogue as this project moves forward.

 

Respectfully submitted,

 

Robert W. Dubois, MD, PhD
Chief Science Officer & Executive Vice President
National Pharmaceutical Council

 


References:

[1] Institute for Clinical and Economic Review. ICER Launches International Collaborative to Develop New Methods to Guide Value-Based Pricing of Potential Cures. January 23, 2019. Available at: https://icer-review.org/announcements/icer-launches-international-collaborative-to-develop-new-methods-to-guide-value-based-pricing-of-potential-cures/

[2] Barlow J, Teagarden R, Trusheim M. Precision Financing of Durable, Potentially Curative Therapies. PharmExec. Published January 27, 2019. Available at: http://www.pharmexec.com/precision-financing-durable-potentially-curative-therapies  

[3] Massachusetts Institute of Technology New Drug Development Paradigms Initiative. Precision Financing Solutions for Durable/Potentially Curative Therapies. Published January 24, 2019. Available at: https://newdigs.mit.edu/sites/default/files/MIT%20FoCUS%20Precision%20Financing%202019F201v023.pdf

[4] Sanders GD, Neuman PJ, Basu A, et al. Recommendations for Conduct, Methodological Practices, and Reporting of Cost-effectiveness Analyses. JAMA. 2016; 316(101): 1093-1103.

[5] Wilke RJ, Neumann PJ, Garrison LP, Ramsey SD. Review of Recent US Value Frameworks – A Health Economics Approach: An ISPOR Special Task Force Report. Value in Health. 2018 Feb;21(2):155-160.

[6] Massachusetts Institute of Technology New Drug Development Paradigms Initiative. Research Brief: Clinical Trials and Investment for Novel CAR-T and TCR Therapies. Published December 21, 2018. Available at: https://newdigs.mit.edu/sites/default/files/FoCUS%20Research%20Brief%202018F212v030.pdf 

[7] Massachusetts Institute of Technology New Drug Development Paradigms Initiative. Research Brief: Projections from the Existing Pipeline of Cell and Gene Therapies: Launches and Patient Numbers. Published October 29, 2018. Available at: https://newdigs.mit.edu/sites/default/files/FoCUS%20Research%20Brief%202018F210v027.pdf