Sunday, 27 May 2012 06:43
Drugmakers challenged to provide adequate data as payers move to reimburse for outcomes rather than drugs.
As payers move toward paying pharmaceutical companies for outcomes rather than drugs, a new study finds that health plan executives find the information provided by drugmakers is inadequate. The survey from PwC’s Health Research Institute finds as the focus shifts to patient outcomes, health organizations want more robust evidence of clinical and economic comparative effectiveness.
Already 16 percent of health insurers have adopted new payment and contracting arrangements such as outcomes-based payments, risk-sharing agreements, and bundled payments with pharmaceutical companies. Of those that haven’t, 37 percent expect to adopt them within the next three years.
The survey comes as biopharmaceutical companies face growing competition from generic drugs and health plans struggle to contain rising costs. The result is the companies are having a harder time getting their premium products onto formularies. The study warns drug companies that changing preferences among consumers and doctors could take a toll on their sales if they don’t move quickly to do more to prove the value of their products and build trust with doctors, hospitals and health plans.
“Those that can effectively demonstrate value in non-traditional ways have an opportunity to gain market share in a very competitive market for prescription drugs,” says Douglas Strang, PwC U.S. pharmaceutical and life sciences advisory co-leader. “Meeting new expectations of value in healthcare affects how drugs will be researched, marketed, manufactured and priced in the future, and first movers will have an advantage.”
The study also found a fair bit of distrust among health insurers over the economic data provided by the drug industry. Only 5 percent of health insurers are very confident – and 44 percent aren’t at all confident – in the economic data provided by the drug industry when making coverage and formulary decisions. And, the survey found only 7 percent to be very confident in the information to evaluate a drug’s comparative effectiveness.
To be considered for drug formulary placement, 82 percent of health plans said a drug manufacturer must demonstrate a clear clinical benefit compared with current branded and generic treatments, and 78 percent demand clear proof-of-cost savings.
More than half of insurers say they rely on independent data to evaluate drug effectiveness. The three most influential factors health plans use when making formulary decisions are the availability of a generic equivalent, physicians’ opinions, and regulatory guidance. Although greater collaboration between drugmakers and health plans could improve the quality of data gathered, the study found such cooperation is difficult because of distrust between the two. It found that three fourths of insurers characterize their relationship with pharmaceutical companies as “transactional” versus “collaborative.”
By DANIEL S. LEVINE