Spotlight on OHE: Value Based Pricing and New Technologies

The OHE has been very active in conceptualising approaches incorporating a broader assessment of the elements of value (often called “value based pricing” or “VBP”), as its publications to date illustrate. During the last quarter of 2012, OHE has been active in discussions of VBP in a variety of forums.

The OHE has been very active in conceptualising approaches incorporating a broader assessment of the elements of value (often called “value based pricing” or “VBP”), as its publications to date illustrate. The OHE Research Paper on operationalising VBP, for example, identifies and analyses the various options for instituting such a system, drawing from examples around the world[1]. The OHE Seminar Briefing on Sweden’s approach to VBP illustrates the effects of particular options in one country.

During the last quarter of 2012, OHE has been active in discussions of VBP in a variety of forums. In October, Jon Sussex participated in a half-day webinar. His presentations outlined the essential elements of any approach to “value based pricing”, including the possible elements of “value” and options for aggregating these elements. The discussion also included how VBP might treat medicines with multiple indications of different “value”.

As gene-based technologies become more common in clinical practice, an aspect of VBP that will become increasingly important is pricing and reimbursement for “co-dependent” technologies. These may include, for example, diagnostic tests that monitor a patient’s response to treatment or “smart” devices that transmit a patient’s data to the GP or other health professional. In April 2012, OHE published a Research Paper reviewing the challenges. More recently, OHE has participated in several discussions about the interplay between VBP and companion technologies.

In September, Adrian Towse participated in a workshop organised by The Centre for Innovation in Regulatory Science (CIRS) that focused on companion diagnostics. His session focused on whether companion diagnostics will become the norm for “personalised” medicine. The discussion centred on what the reimbursement challenges may be for both drug developers and coverage bodies, particularly in the case of new and expensive drug-diagnostic combination therapies that target subpopulations.

In November, at the ISPOR 15^th Annual European Congress, Adrian chaired a panel on assessing the value of co-dependent technologies that included OHE’s Martina Garau. Her presentation (see below) discussed methods and processes for coordinating the assessment of diagnostics and treatments and urged that a consistent approach be developed and implemented. This was based in part on an OHE study funded by Novartis Molecular Diagnostics.