Highlights
- •Without reimbursement at branded prices, drug manufacturers would not develop many drugs, and those drugs would never become available at generic prices. Therefore, cost-effectiveness analyses should include generic prices because they represent an anticipated consequence of reimbursement at branded prices.
- •Including price declines in an analysis of inclisiran, a new cholesterol treatment, yields more favorable cost-effectiveness ratios. Assuming displacement of inclisiran with a follow-on drug does not substantially alter this result if we assume that it likewise eventually loses exclusivity and declines in price.
- •To ensure realistic value estimates, cost-effectiveness analyses should account for anticipated life cycle price patterns.
Abstract
Objectives
Guidance on the conduct of health technology assessments rarely recommends accounting
for anticipated future price declines that can follow loss of marketing exclusivity.
This article explores when it is appropriate to account for generic pricing and whether
it can influence cost-effectiveness estimates.
Methods
This article presents 4 case studies. Case study 1 considers a hypothetical drug used
by a first patient cohort at branded prices and by subsequent, “downstream” cohorts
at generic prices. Case study 2 explores whether statin assessments should account
for generic prices for downstream cohorts that gain access after the initial cohort.
Case study 3 uses a simplified spreadsheet model to assess the impact of accounting
for generic pricing for inclisiran, used when statins insufficiently reduce cholesterol.
Case study 4 amends this model for a hypothetical, advanced, follow-on treatment displacing
inclisiran.
Results
Assessments should include generic pricing even if the first cohort using a drug pays
branded prices and only downstream cohorts pay generic prices (case study 1). Because
eventual generic pricing for statins did not depend on decisions for downstream cohorts,
assessing reimbursement for those cohorts could safely omit generic pricing (case
study 2). For inclisiran (case study 3), including generic pricing notably improved
estimated cost-effectiveness. Displacing inclisiran with an advanced therapy (case
study 4) modestly affected estimated cost-effectiveness.
Conclusions
Although this analysis relies on simplified and hypothetical models, it demonstrates
that accounting for generic pricing might substantially reduce estimated cost-effectiveness
ratios. Doing so when warranted is crucial to improving health technology assessment
validity.
Keywords
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Article info
Publication history
Published online: November 03, 2022
Accepted:
September 23,
2022
Publication stage
In Press Corrected ProofIdentification
Copyright
© 2022 International Society for Pharmacoeconomics and Outcomes Research, Inc. Published by Elsevier Inc.
