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Market Access Right Product, Right Patient, Tight Price, Tighter Reimbursement invivo.pharmamedtechbi.com NOVEMBER 2016 Invol. 34 ❚ no. 10 Vivopharma intelligence ❚ informa Market Access Right product, right patient, tight price, tighter reimbursement Value Frameworks Price Transparency Real-World Evidence Outcomes-Based Reimbursement invivo.pharmamedtechbi.com CONTENTS ❚ In Vivo Pharma intelligence | November 2016 26 Curative Regenerative Medicines: Preparing Health Care Systems For The Coming Wave FARAZ ALI, TED SLOCOMB AND MICHAEL WERNER We may be at the dawn of a new era of curative regenerative therapies, but their very nature may create barriers to adoption. The Alliance for Regenerative Medicine frames the opportunities and challenges for the industry, arguing that policy makers must begin to understand THE MARKET ACCESS ISSUE the ways that these therapies represent value for money. 10 22 States Fight For Drug Price US Outcomes-Based 1 Transparency Contracts: Big Uptick In ED SILVERMAN Interest, But Not Execution California’s Proposition 61 and a number CATHY KELLY of other state-led measures to control The promise of outcomes-based drug prices failed to gain traction in contracts for biopharmaceuticals has 2016. But states are likely to remain a yet to be realized in the US. Although battleground in the war against costs in precise numbers are hard to come by, a pharma-friendly Trump administration. payers and manufacturers agree the field is still nascent. However, they 16 don’t seem to be giving up on the idea. Is The UK Still Open 34 For Medtech Innovation Reimbursement? Real-World Evidence ASHLEY YEO And The Quest For Confusing and ineffective channels of European Market Access innovation adoption and a lack of FRANcescA BRUce funding hamper the UK’s reputation as Real-world evidence promises to solve one of the world’s health care capitals many problems inherent in getting a and a driver of care excellence – in spite drug to patients at a good price. It could of its global brands, NICE, MHRA and the slash development costs and help make NHS itself. But changes that should the reimbursement case to payers. But transform market access are in place and there are challenges for companies that are worthy of close attention in the next want to exploit real-world evidence to two to three years. get their drug to patients in Europe. ©2016 Informa Business Information, Inc., an Informa company November 2016 | In Vivo ❚ CONTENTS In Vivo Pharma intelligence | November 2016 DEPARTMents EXCLUSIVE ONLINE content invivo.pharmamedtechbi.com AROUND THE INDUSTRY ❚ Deals In Depth ❚ What Pharma Can Do About 4 Drug Pricing: With “Value” September 2016 Debate In Full Swing, ICER’s Brexit: Views From The C-Suite AMANDA MICKLUS Influence Grows JOHN ROUNTREE MELANIE SENIOR ❚ Where Do Life Science Business ❚ Biopharma Quarterly Models Come From? 7 Should We Be Alarmed By Dealmaking Statistics, Q3 2016 Prescription Drug Cost Growth? BRIAN SMITH MAUREEN RIORDAN AND JOshua COHEN AMANDA MICKLUS ❚ The Future Of Specialty 8 In Vivo’s Deals Of The Month: Drug Pricing October 2016 NANCY DVORIN NANCY DVORIN 38 ON THE MOVE Significant recent job changes in ❚ From The Editor pharma, medtech and diagnostics REGINA PALESKI The long US presidential campaign concluded with the election of Donald Trump in a con- 2 test that unexpectedly went to the wire. The 42 DEALMAKING health care industry could see some dramatic Deals Shaping The Medical Industry, changes during the next four years, but un- October 2016 certainty about what is to come has been bal- THE STRATEGIC TRANSACTIONS TEAM anced with optimism that some of Trump’s proposed reforms will be good for business. Those who expect the furor over steep You Asked...We Delivered! Relevant and exclusive online-only drug prices hikes to die down will probably content at your fingertips 24/7 be disappointed. Trump may well be more NANCY DVORIN pharma-friendly than Clinton would have Access your subscription by visiting: been, but there is still bipartisan support for invivo.pharmamedtechbi.com price control measures. And Trump voters may be among the most vocal and log in. in demanding fair access to the medicines they need. Even though federal initiatives to control drug prices are less likely un- Don’t have an online user account? der Trump than Clinton, individual US states are not likely to abandon Quickly and easily create one their own legislative efforts despite the defeat of California’s Prop 61 at by clicking on the “Create your the ballot box. That’s just one of the stories we cover in this special mar- account” link at the top of the page. ket access issue. Within these pages we also explore value frameworks for Contact: determining optimal drug pricing, including regenerative medicines that [email protected] may cure with a single dose; early movers who are defining the terms for or call: (888) 670-8900 or +1 (908) outcomes-based contracts between pharmas and payers; the challenges 748-1221 for additonal information. of using real-world evidence to support European product launches; and initiatives in the UK – like the US, reeling somewhat from an implausible national vote result in 2016 – designed to counter the innovation-stifling effects of pricing and reimbursement pressures. May I ask you a favor? We are conducting a quick and painless survey to determine what you think about In Vivo. Please visit http://bit.ly/2fLWOVK. /invivo @invivo /invivo Your feedback will help us determine how we can better meet your needs. In Vivo | November 2016 invivo.pharmamedtechbi.com invivo.pharmamedtechbi.com invivo.pharmamedtechbi.com Strategic Transactions Pharma intelligence | 3 The most trusted source of health care deal intelligence You can rely on the insight and information in Strategic Transactions to carry out these and many more critical business development activities. The top pharmaceutical firms and leaders in medical devices, diagnostics, finance and consulting already do. Available via annual subscription. For more information and to request a complimentary demonstration, visit: www.Pharmamedtechbi.com/STLP ©2016 Informa Business Information, Inc., an Informa company November 2016 | In Vivo ❚ Around The Industry Drug Pricing: With “Value” Debate In Full Swing, ICER’s Influence Grows The Institute for Clinical and Economic Review has invited feedback on its methodology recommended price range. Not many other for calculating a drug’s recommended price range. Industry response has been critical, countries’ drug cost-watchdogs – many but pharma can no longer afford to merely oppose value frameworks. It needs to create of which have been in place a lot longer – strategies for a world in which such frameworks are a permanent and influential part have offered industry the opportunity to of the pricing and reimbursement landscape. influence how drugs are assessed. ICER’s Value Assessment Framework “We are not out to strangle the indus- ronment in the US” after the election. currently comprises two measures: Care try,” insisted Steven Pearson, president Organizations such as ICER, a non- Value, which is a measure of a drug’s com- and founder of ICER (the Institute for Clini- profit group with no statutory authority at parative clinical effectiveness and cost- cal and Economic Review), during an inter- all, are adding fuel to the fire. Manufactur- effectiveness, and Health System Value, view in late 2015. “We’re just out to create ers including Amgen Inc., Bristol-Myers a measure of the five-year budget impact a framework for having a dialogue around Squibb Co. and Roche are stinging from on health systems. Both together lead to drug price and value,” he continued. ICER’s reports that their drugs are too a “value-based price benchmark” – the One year on, and that dialogue is pricey – even as much as 80% too pricey. price at which patients could be treated certainly in full swing in the US. Industry Payers don’t have to act on them, though for reasonable long-term value, without might well be in the line of fire, but ICER’s some are delighted to have more justifica- crippling the system short term. 4 not the only one shooting. ICER reviews tion for aggressive contracting positions the cost-effectiveness and affordability of and stricter coverage restrictions (that NO SHOrtage OF Critics high-profile new drugs, and has indeed could happen with or without ICER). But Industry responded to ICER’s call with a concluded that many of them are priced there’s mixed evidence, as yet, that ICER’s range of criticisms. They included: too well above what might be considered recommended price ranges are influenc- much focus on drug costs as the main value-for-money. But a series of mas- ing actual prices achieved. (Also see "ICER determinant of health system value; the sive drug price hikes from companies Eyes QALY Ratios, Budget Impacts In Meth- use of list prices, not actual prices paid, like Turing Pharmaceuticals AG, Vale- ods Review" – Pink Sheet, July 28, 2016.) to determine costs; inappropriate use of ant Pharmaceuticals International Inc. “We’re still early in the cycle of payers the budget impact measure; inappropriate and Mylan NV has also put drug pricing using this information concretely to de- use of the quality-adjusted life year (QALY) front and center in an already heated sign payment mechanisms for drugs. It’s to measure drugs’ cost-effectiveness; US political climate. Failed Presidential still pilots and things,” admitted Pearson. overestimates of drug uptake rates; and candidate Hillary Clinton proposed a se- More worrisome, however, is the influ- (from Amgen and BMS, among others) a ries of measures to curb excessive price ence ICER reports could have on the Centers lack of transparency in the models. increases and supports Medicare’s right for Medicare and Medicaid Services (CMS). Pharmaceutical companies aren’t the to negotiate prices. (Also see "Clinton's That agency’s proposal to change the way only critics.
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