Access to medicines and value-based decision-making in Europe

Prof. Dr. Katharina Blankart, MBR

University of Duisburg-Essen, Germany

Lima, Peru, 26./27.9.2019

The 1,000 Dollar Pill

Timed access to healthcare technology

on patients

Good health assessment practices in

Europe

1

2

3

New drug for Hepatitis C

Source: https://www.dndi.org/diseases-projects/hepc/

• Sovaldi (Sofosbuvir) was launched globally in

2014 by Gilead Sciences

• Drug substantially increased cure rates for

patients with Hepatitis C

• Avoidance of liver transplantations and severe

side-effects

• Launch price in Germany at 20.000 Euro /

package

Sovaldi raised questions of affordability and accessibility to medicines around the globe

The 1,000 Dollar Pill

Timed access to healthcare technology

on patients

Good health assessment practices in

Europe

1

2

3

Access to health technology

• Physical accessiblity – „availability of good health services within reasonable reach of those who need them”

• Financial affordability – „people’s ability to pay for services without financial hardship”

• Acceptability – „people’s willingness to seek services”

Source: Evans et al. 2013 (WHO Bulletin; https://www.who.int/bulletin/volumes/91/8/13-125450/en/)

Source: Barber, R.M. et al., 2017. Healthcare Access and Quality Index based on mortality from causes amenable to personal health care in 195 countries and territories, 1990–2015: a

novel analysis from the Global Burden of Disease Study 2015. The Lancet 390, 231–266. https://doi.org/10.1016/S0140-6736(17)30818-8

Access and quality to care has increased since 1990 and reduced mortality

Healthcare Access and Quality Index based on mortality from causes amenable to personal health care

Access to medicines influences disability in European counties

Effects of 1982-2015 drug launches on mean 2015 disability of people with at least one medication

Source: Lichtenberg, F.R., 2019. The impact of access to prescription drugs on disability in eleven European countries. Disability and Health Journal 12, 375–386.

https://doi.org/10.1016/j.dhjo.2019.01.003

Disability measure Actual mean Counterfactual (no

1982-2015 drug

launches) mean

Effect of 1982-2015

drug launches

Probability of severe

limitation

16.9% 21.8% -4.9%

Probability of any

limitation

53.4% 61.1% -7.7%

Mean number of

Activities of Daily

Living limitations

0.34 0.48 -0.14%

Mean CASP index

(quality of life in later

life)

36.58 37.16 0.58

Access and affordability – same patterns but different levels by price control regimes

Cockburn, I.M., Lanjouw, J.O., Schankerman, M., 2016. Patents and the Global Diffusion of New Drugs. American Economic Review 106, 136–164. https://doi.org/10.1257/aer.20141482

Not all drugs are launched at the same time

Simmons, B., Cooke, G.S., Miraldo, M., 2019. Effect of voluntary licences for hepatitis C medicines on access to treatment: a difference-in-differences analysis. The Lancet Global Health 0. https://doi.org/10.1016/S2214-109X(19)30266-9

Improving access by voluntary licensing of manufacturers

Access to HCV treatment increases in number of people treated in low and middle income countries

Introduction of Sofosbuvir

Prices and affordability

Source: Iyengar, S., Tay-Teo, K., Vogler, S., Beyer, P., Wiktor, S., Joncheere, K. de, Hill, S., 2016. Prices, Costs, and Affordability of New Medicines for Hepatitis C in 30 Countries: An Economic Analysis. PLOS Medicine 13, e1002032. https://doi.org/10.1371/journal.pmed.1002032

Duration of time an individual would need to work to pay for 12 wk of treatment with sofosbuvir.

The 1,000 Dollar Pill

Timed access to healthcare technology

on patients

Good health assessment practices in

Europe

1

2

3

Coverage of health services by three dimensions of benefit catalogues

Reimbursement of a given population or a disease category by an insurance company, a sickness fund or, the national health system.

1. Population Coverage (Breadth)

2. Service Coverage (Depth)

3. Cost

coverage

(Height)

1. Population Coverage (Breadth)

2. Service Coverage (Depth)

3. Cost

coverage

(Height)

Source: Schreyögg et al. (2005): EJHE, 6(S1):2-10.

Aim

What determines the value of a new technology?

𝑉 = 𝑏𝑒𝑛𝑒𝑓𝑖𝑡 / 𝑝𝑟𝑖𝑐𝑒

Two approaches by decision-makers

- Formal cost-effectiveness analysis

- Added therapeutic value approach

Comparison with other drugs or standard ofcare to link price to health benefit

Focus is on relative effectiveness: howtreatments work compared with existingalternatives

Components of benefit and cost

Link between marketing authorization, post-marketing evaluation and price

The German Health System

• Social health insurance system

• 83 million inhabitants

• 90% of population covered

• 121 statutory corporations

• Mandatory for employees below income of 54.000 EUR

• Principles: solidarity, benefits in kind, financing byemployees and employers, self-administration, plurality

Germany

Source: Eurostat regional yearbook, 2019, p.13, population density

• Principles

• Health services covered if adequate, appropriate, and efficient (Social Code Book (SGB) V)

• All Rx-Medication is covered and accessible generally a negative list

• 10% co-payments for patients (5-10 EUR / prescription)

• Newly licensed pharmaceuticals

• Since 2011: Arzneimittelmarktneuordnungsgesetz (AMNOG)

• evaluation of health benefit for price negotiations, § 35a SGB V

• Includes Biologics, Orphan Drugs are exempt up to 50 Mio EUR turnover per year

• All pharmaceuticals

• Internal reference pricing in selected drug classes to set ceiling prices

• Rebate contracts between sickness funds and pharmaceutical manufacturers

The German Health System

Definition of pharmaceutical benefit catalogue and cost-containment

Source: https://www.commonwealthfund.org/blog/2019/how-drug-prices-are-negotiated-germany

How Germany negotiates prices for new drugs?

What is evaluated by the AMNOG process

• 4 dimensions of therapeutic benefit

• Mortality

• Morbidity

• Quality of Life

• Adverse events

• Comparator definition: based on formal requirements, cannot be negotiated

• Based on standards of evidence based medicine

• Technologies for which evidence in clinical use exists

Dimensions of health benefit and comparator definition

More information provided via: https://www.gkv-spitzenverband.de/english/statutory_health_insurance/amnog_evaluation_of_new_pharmaceutical/amnog_english.jsp

Health benefit rated at level of patient subgroups ≤ licensed indication

Decisions are made at level of patient subgroup (GBA) makes multiple decisions for the same substance

Substance

Patient subgroup 1

Patient subgroup 2

Patient subgroup …

Addedbenefit

Major

Considerable

Minor

Not quantifiable

No addedbenefit

No addedbenefit

Less thancomparator

Rating of health benefit at patient subgroup levelPatient subgroups for which patient relevant benefit isexpected are defined

More information: https://www.g-ba.de/english/benefitassessment/

- curing of illness

- significant increase in length of survival

- long-term freedom from serious symptoms

- far-reaching avoidance of serious side-effects

- easing of serious symptoms

- moderate increase in length of survival

- tangible alleviation of disease

- relevant avoidance of serious side effects

- meaningful avoidance of other side effects

Evidence base not sufficient

- reduction of not serious side-effect

- relevant avoidance of side-effect

224 drugs were evaluated by 2018, 57% showed an added health benefit

Source: Greiner et al., AMNOG-Report 2019

Cardiovascular diseases

Cancer

Mental conditions

And how did Sofosbuvir perform?

Manufacturer IQWIG GBA

Submits evidence,

defining 17 patient

subgroups

Claims major added

benefit in 11 patient

subgroups

Not quantifiable added

health benefit in 1

patient group

(Genotype 2, no

previous therapy)

Other evidence not

acceptable as

medication not

administered

appropriately in trial

Same rating as IQWIG

for Genotype 2 even

considerable health

benefit

Minor benefit in 8

additional patient

subgroups

Price

negotiations

High media attention

due to large expected

cost burden for

statutory health

insurance

Arbitration board was

called

Settled with 10%

rebate before

arbitration decision

Assessment of added health benefit leads to prices set according to value

Average rebate on list price was 23.4% but what matters in terms of value is the mark-up on thecomparator product

Lauenroth, V.D., Stargardt, T., 2017. Pharmaceutical Pricing in Germany: How Is Value Determined within the Scope of AMNOG? Value in Health 20, 927–935. https://doi.org/10.1016/j.jval.2017.04.006

Stern, A.D., Pietrulla, F., Herr, A., Kesselheim, A.S., Sarpatwari, A., 2019. The Impact Of Price Regulation On The Availability Of New Drugs In Germany. Health Affairs 38, 1182–1187. https://doi.org/10.1377/hlthaff.2018.05142

Opt-out as potential thread to access

Not an issue: 98% of drugs with positive benefit remained in the market

Publication of German HTA appraisal accelerates time to adoption

The value of a positive health benefit is equivalent to promotional spendings of about 400 EUR / physician

Results for 7,356 adoption decisions, 21 drugs, total

sales volume 70 Mio. EUR

Source: Blankart, K.E., Stargardt, T., The impact of information on drug quality ratings from health technology assessment on brand name drug adoption. working paper.

Sources of

value

Country Initiation of the

evaluation

process

Require clinical

evidence

Require cost-

effectiveness /

cost-utility

analysis

Exclude drug

from benefit

catalogue

Price negotiation

Therapeutic

benefit

Germany (G-

BA)

Manufacturer or

agency

Yes No No Yes

France (HAS) Manufacturer Yes (Yes) No Yes

Cost-

effectiveness

England (NICE) Government Yes Yes Yes Yes

Scotland (SMC) Manufacturer or

patients

Yes Yes Yes No

Australia

(PBAC)

Manufacturer Yes Yes Yes Yes

Benefit assessments in Europe and elsewhere

Source: Barnieh L et al. Value in Health. 2014 Jan;17(1):98–108.

Sources of value:

Health gains measured as QALY

(quality adjusted life year), cost

against comparator + additional

considerations, e.g. equity, end of

life, orphan

Not only criteria, but also processes differ

Determining value is a challenging exercise

Comparison of German decisions with the England (NICE) or Scotland (SMC) reveals large differences

Source: Heisser T, Fischer K, Stargardt T (2015): Health Benefit Assessment Of Pharmaceuticals: An International Comparison Of Decisions from Germany, England, Scotland

and Australia.

a. NICE Decisions by G-BA Decisions b. NICE Clinical Effectiveness by G-BA Decisions

G-BA Added

Benefit

No Added

Benefit

G-BA Added

Benefit

No

Added

BenefitNICE Sum NICE Sum

Recommended 14 18 32 Better 19 21 40

Restricted 2 7 9 Similar/not proven 5 10 15

Not recommended 8 6 14 Sum 24 31 55

Sum 24 31 55

Cohen's Kappa: -0.13 Cohen's Kappa: 0.11

Market access of medical devices in Germany

Default scenario to obtain reimbursement depends on inpatient and outpatient setting

Inpatient Outpatient

New procedures permitted

with the reservation of

prohibition(Verbotsvorbehalt, § 137c SGB V)

Medical devices receive CE mark; unless prohibited by G-BA,

hospitals may use them

Hospitals may use all CE

marked innovations

New procedures are

prohibited until they have

been approved(Erlaubnisvorbehalt, § 135 (1) SGB V )

G-BA needs to approve

medical device before use

Long application process to

gain approval

Source: https://www.slideserve.com/mab/webinar-reimbursement-of-innovative-medical-devices-in-germany

Reimbursement pathways for medical devices in Germany

CE Mark

Inpatient Outpatient

Already

reimbursed

AdequateOPS / DRG

available

New OPS / DRG required

‚On top payment‘ required

OPS/DRG

applicationNUB (ZE)

Additional evidencerequired

Applicationexperimental

coverage

Inclusion in fee schedule

EBM / GOÄ

applicationIGeL

Out of pocketpayments

Selective

contracts

Individual

Sickness

funds

IGeL: individuelle Gesundheitsleistungen (individual health services); OPS: Operationen- und Prozedurenschlüssel (International Classification of Procedures in Medicine (German version); DRG: diagnosis related group; NUB (ZE): Neue Untersuchungs und Behandlungsmethoden; ZE: Zusatzentgelt (additional fee))

Payment per hospital case

and complexity

e.g. BurriedBumper (2017) new OPS code

High cost innovative technologies not

covered by DRG, e.g. complex heart surgery

Liposuktion

for lipedema

e.g. videodoctor

consultation

Mostly low to novalue procedures

and tests, e.g. MRT in early dementia

Digital healthapplications, e.g.

TK - MolecularHealth Guide

Source: https://www.slideserve.com/mab/webinar-reimbursement-of-innovative-medical-devices-in-germany

Assessment of new procedures in Germany

G-BA Methodenbewertung

Challenges and opportunities

• Challenges

• Focus is on new technologies

• Assessment of value seem depend on health system setting EU striving towards a uniform HTA

• Weak integration of ambulatory and hospital care

• Different pathways, different types of value assessments

• Slow uptake of integrated care models and process innovations Innovation funds as tool to overcome this

• Comparison across technologies still limited (drugs vs. procedures vs. medical devices)

• Opportunities

• HTA contributes to transparent and accountable decision-making

• European evidence assessments publicly available

• HTA provides considerably more information than clinical tirals (Wieseler et al. 2015, BMJ)

• All German value appraisals and guidelines freely available at: https://www.g-ba.de/

• International services of UK National Institute for Health and Care Excellence: https://www.nice.org.uk/about/what-we-do/international-services

What can we learn from the European experience?

Jun.-Prof. Dr. Katharina Blankart, MBR

Universität Duisburg-Essen

Fakultät für Wirtschaftswissenschaften

Juniorprofessur für empirische

Gesundheitsökonomik

Tel Büro: +49 201-183-4403

Tel Mobil: +41-76-761-8818

Katharina.Blankart@uni-due.de

Questions? Comments?