USING ECONOMIC EVALUATIONS IN DRUG REIMBURSEMENT DECISIONS NICE experiences from overseas

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USING ECONOMIC EVALUATIONS IN DRUG REIMBURSEMENT DECISIONS NICE experiences from overseas

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Title: USING ECONOMIC EVALUATIONS IN DRUG REIMBURSEMENT DECISIONS NICE experiences from overseas


1
USING ECONOMIC EVALUATIONS IN DRUG REIMBURSEMENT
DECISIONSNICE experiences from overseas
  • Michael Drummond
  • Centre for Health Economics
  • University of York
  • United Kingdom

2
OUTLINE OF PRESENTATION
  • Some background.
  • International guidelines for economic evaluation.
  • Procedures in different countries.
  • Lessons from the use of economic evaluation in
    drug reimbursement decisions.
  • Issues for countries considering introducing
    economic evaluation requirements.

3
SOME BACKGROUND
  • Several jurisdictions have imposed a Fourth
    Hurdle or requirement for economic data as part
    of pricing/reimbursement decisions for drugs.
  • The new requirements are usually accompanied by a
    set of guidelines for company submissions.
  • Pricing decisions may or may not be linked with
    reimbursement decisions.
  • Australia was the first jurisdiction to implement
    such a requirement. England and Wales (through
    the National Institute for Clinical Excellence)
    provides a recent example.

4
CLASSIFICATION OF EXISTING GUIDELINES
PURPOSE
SOURCE
Reimbursement or Listing
Methodological Standards
Ethics and Conduct
Australia Belgium
Finland The Netherlands Norway
Ontario Portugal
Sweden United Kingdom
Government or Payers
CCOHTA (Canada) PHS Panel
(USA) AMCP (USA)
Academia
Langley et al (USA) Alban et al (DK)
LDI Task Force (USA) Rovira et
al (Spain) Hannover (Germany)
BESPE (Belgium)
BMJ Working Party (UK) Garattini et al
(Italy) College of Economists
(France)
LDI Task Force (USA)
Industry
PHrMA (USA)
5
IN GENERAL, WHATS COVERED BY GUIDELINES?
  • Viewpoint for analysis.
  • Choice of comparator.
  • Form(s) of economic analysis.
  • Measurement and valuation of costs and benefits.
  • Discounting.
  • Allowing for uncertainty.
  • Presentation of results.

6
THE MAIN SIMILARITIES AMONG GUIDELINES
  • Choice of comparator.
  • Importance of good data on clinical
    effectiveness.
  • Discounting of future costs and benefits.
  • Incremental comparisons.
  • Allowing for uncertainty.

7
MAJOR AREAS FOR METHODOLOGICAL DEBATE
  • Viewpoint for the analysis.
  • Relevance of Phase III trials and the role of
    modelling.
  • Measurement and valuation of health outcomes
    (e.g. QALYs, WTP).
  • Handling uncertainty.
  • Budget impact analysis.

8
PRICING AND REIMBURSEMENT OF DRUGS IN AUSTRALIA
  • Submissions for inclusion on the Pharmaceutical
    Benefits Schedule are made to the Pharmaceutical
    Benefits Advisory Committee (PBAC).
  • Submissions are required for all new drugs
    (including additional indications and new
    formulations) to be used outside of public
    hospitals.
  • The PBAC issues recommendations to the Minister.
  • Although a price is assumed in the submission,
    pricing decisions are made by a separate
    committee.

9
SUBMISSION AND REVIEW PROCESS UNDER THE
AUSTRALIAN GUIDELINES(Glasziou and Mitchell,
1996)
10
PRICING AND REIMBURSEMENT OF DRUGS IN ENGLAND AND
WALES
  • Most drugs are reimbursed under the NHS at the
    manufacturers chosen price.
  • Several drugs with a major impact on the NHS
    are selected by NICE for detailed appraisal.
  • On the basis of its appraisal, NICE issues
    guidance on the use of health technologies to the
    NHS.
  • Since December 2001 the guidance has been
    mandatory.

11
NATIONAL INSTITUTE FOR CLINICAL EXCELLENCE (NICE)
APPRAISAL PROCESS
12
NICE TECHNOLOGY APPRAISALS ISSUED BY 2001
  • Cardiovascular disease
  • Coronary artery stents in the treatment of IHD
    (May 2000).
  • Implantable cardioverter defibrillators for
    arrhythmias (September 2000)
  • Endocrine diseases
  • Pioglitazone for type 2 diabetes mellitus (March
    2001).
  • Rosiglitazone for type 2 diabetes mellitus
    (August 2000).
  • ENT
  • Hearing aid technology (July 2000).
  • Gastrointestinal disease
  • Laparoscopic surgery for inguinal hernia (January
    2001).
  • Proton pump inhibitors for dyspepsia (July 2000).

13
NICE TECHNOLOGY APPRAISALS ISSUED BY 2001
  • Infections/infectious diseases
  • Interferon alpha and ribavirin for hepatitis C
    (October 2000).
  • Zanamivir for the treatment of influenza
    (November 2000).
  • Malignant disease and immunosuppression
  • Taxanes for breast cancer (June 2000 and
    September 2001).
  • Fludarabine for chronic b-cell lymphocytic
    leukaemia (September 2001).
  • Topotecan for advanced ovarian cancer (August
    2001).
  • Docetaxel, paclitaxel, gemcitabine and
    vinorelbine for non-small cell cancer (June
    2001).
  • Gemcitabine for the treatment of pancreatic
    cancer (May 2001).
  • Temozolomide for malignant glioma (April 2001).
  • Laparoscopic surgery for colorectal cancer
    (December 2000).
  • Liquid based cytology for cervical screening
    (June 2000).
  • Taxanes for ovarian cancer (May 2000).

14
NICE TECHNOLOGY APPRAISALS ISSUED BY 2001
  • Mental health/central nervous system
  • Donepezil, rivastigmine and galantamine for
    Alzheimers disease (January 2001).
  • Methylphenidate for attention deficit
    hyperactivity disorder (October 2000).
  • Orlistat for the treatment of obesity in adults
    (March 2001).
  • Riluzole for motor neurone disease (January
    2001).
  • Sibutramine for obesity in adults (October
    2001).
  • Musculo skeletal and joint
  • COX II selective inhibitors for osteoarthritis
    and rheumatoid arthritis (July 2001).
  • Hip prostheses for primary hip replacement
    (April 2000).
  • Autologous cartilage transplantation for full
    thickness cartilage defects in knee joints
    (December 2000).
  •  
  •  

15
NICE TECHNOLOGY APPRAISALS ISSUED BY 2001
  • Oral and maxillofacial
  • Wisdom teeth appropriate removal (March 2000).
  •  
  • Respiratory systems
  • Inhaler systems for under-5s (August 2000).
  •  
  • Skin/wounds
  • Debriding agents and specialist wound care
    clinics for difficult to heal surgical wounds
    (April 2001).

16
MOST RECENT GUIDANCE FROM NICE
  • New topics are not dissimilar from those studied
    this far
  • glycoprotein 11b/111a inhibitors revision
  • surgery to aid weight reduction
  • pegylated liposomal doxorubicin hydrochloride for
    advanced ovarian cancer
  • metal hip resurfacing arthoplasty
  • human growth hormone in children with growth
    failure
  • routine antenatal anti-D prophylaxis for
    RhD-negative women
  • infliximab for Crolins disease.
  • Now that NICE also issues clinical practice
    guidelines there is a growing debate about the
    relationship between technology appraisals and
    practice guidelines.

17
MAIN LESSONS FROM THE USE OF ECONOMIC EVALUATION
AT THE CENTRAL LEVEL (1)
  • Demonstration of clinically-important benefits is
    still paramount.
  • Economic data are more important when there is
    substantial budgetary impact.
  • Devices and procedures are generally harder to
    appraise than drugs.

18
MAIN LESSONS FROM THE USE OF ECONOMIC EVALUATION
AT THE CENTRAL LEVEL (2)
  • Difficulties arise owing to the lack of
    transferability of economic data.
  • Political will is sometimes tested (e.g.
    Beta-interferon).
  • In reimbursement decisions, total refusal is
    rare limitations or restrictions in use are much
    more common.

19
NICE GUIDANCE ON THE USE OF COX II SELECTIVE
INHIBITORS (CELCOXIB, ROFECOXIB, MELOXICAM AND
ETODOLAC) FOR OSTEOARTHRITIS AND RHEUMATOID
ARTHRITIS
  • Cox II selective inhibitors are not recommended
    for routine use in patients with rheumatoid
    arthritis (RA) or osteoarthritis (OA). They
    should be used in preference to standard NSAIDs,
    when clearly indicated as part of the management
    of RA or OA, only in patients who may be at high
    risk of developing serious gastrointestinal
    adverse effects.

20
MAIN LESSONS FROM THE USE OF ECONOMIC EVALUATION
AT THE CENTRAL LEVEL (3)
  • Cost-effectiveness of a technology may change
    over time and decisions may have to be reviewed.
  • Application of economic evaluation in decision
    making has revealed weaknesses in Phase III drug
    studies.
  • Litigation is increasingly being used by
    manufacturers.
  • Decisions do reflect a cost-effectiveness logic
    although other factors clearly come into play.

21
INCREMENTAL COST PER ADDITIONAL LIFE-YEAR GAINED
LEAGUE TABLE
Source George et al. PharmacoEconomics 2001
19(11) 1103-1109.
22
PROBLEMS WITH A SINGLE COST-EFFECTIVENESS
THRESHOLD
  • Cost-effectiveness of health technologies varies
    by country.
  • Societal willingness-to-pay for health
    technologies may vary by country.
  • Without the overall budgetary impact, the
    cost-effectiveness ratio cannot tell us the
    opportunity cost of adopting the new technology.
  • Other factors (e.g. equity) enter into
    decision-making.

23
FACTORS FREQUENTLY CONSIDERED ALONGSIDE
COST-EFFECTIVENESS
  • Seriousness of the health condition.
  • Availability of alternative therapies.
  • Number of patients, and hence budgetary impact.
  • Daily cost to patients if drug not listed.
  • Whether the drug is a lifestyle drug.

24
HOW ARE REIMBURSEMENT RULES OR GUIDANCE
IMPLEMENTED?
  • Depends on the jurisdiction and clinical setting.
  • Use of hospital-based drugs can be influenced by
    budgetary controls and formulary listing.
  • Use of drugs in primary care can be influenced by
    clinical guidelines (e.g. approval on
    authority), financial incentives and formulary
    restrictions.
  • In the UK, the Department of Health is conducting
    a study of the implementation of NICE guidance.

25
ISSUES FOR COUNTRIES INTRODUCING THE FOURTH
HURDLE
  • Do we request evidence for all new drugs, or just
    some?
  • How do we prioritize drugs for assessment?
  • Does it make sense to assess several drugs in the
    same class together?
  • How prescriptive, or flexible, should we be in
    specifying the data requirements?

26
ISSUES FOR COUNTRIES INTRODUCING THE FOURTH
HURDLE (Continued)
  • Should we be willing to accept data from other
    countries? If so, which?
  • Should we be willing to accept commercial-in-confi
    dence data submitted by companies?
  • Should the reasons for reimbursement decisions be
    made public?
  • Should there be an appeals process? If so, what
    should this consist of?

27
ISSUES FOR COUNTRIES INTRODUCING THE FOURTH
HURDLE (Continued)
  • Should we consider a two-stage appraisal process?
  • Should we consider risk-sharing deals with
    companies?

28
ACCEPTING DATA FROM OTHER COUNTRIES
  • An important issue for countries with limited
    resources to undertake or assess economic
    evaluations.
  • The key issue is whether economic studies are
    generalizable from one setting to another.

29
FACTORS LIKELY TO LIMIT GENERALIZABILITY OF
ECONOMIC STUDIES
  • Demography and epidemiology of disease.
  • Clinical practice patterns.
  • Relative price differences.
  • Incentives to health professionals or
    institutions.
  • Community valuations of health and health care.

30
THE GENERALIZABILITY OF ECONOMIC EVALUATIONS OF
DRUGS IN EUROPE
  • What are the main causes of variation in study
    results from place to place?
  • Does the extent of variation differ among
    different health economic study types? (e.g.
    modelling studies, trial-based studies).
  • Are there systematic differences in study results
    between particular countries?
  • Is the extent of variation in study results
    between countries important for decision-making?
  • Barbieri et al, 2003.

31
QUANTITY OF STUDIES AND RANGE OF COVERAGE
  • 2400 references retrieved.
  • 46 intercountry comparisons
  • 29 comparisons in multicountry studies
  • 17 comparisons in methodologically-equivalent
    single-country studies.

32
MAJOR CAUSES OF VARIATION IN STUDY RESULTS FROM
PLACE TO PLACE
  • Depends on type of study.
  • When only unit costs are allowed to vary, drug
    costs and hospitalization costs are the most
    important causes.
  • When all factors are allowed to vary, differences
    in resource use and cost are the most important
    causes.

33
GENERALIZABILITY OF STUDIES BY METHODOLOGY

34
RELATIVE COMPARISON OF COST-EFFECTIVENESS AMONG
COUNTRIES
35
IMPORTANCE OF VARIATION IN STUDY RESULTS FOR
DECISION-MAKING
  • Depends on the threshold cost-effectiveness
    ratio.
  • With a willingness-to-pay for a QALY of 50,000
    we would only reach a different decision
    (comparing countries) in 3 out of 28 cases.

36
CONCLUSIONS
  • Several jurisdictions now request
    cost-effectiveness data in respect of drug
    pricing or reimbursement decisions.
  • These decision-making processes have proved
    workable, although many problems/ issues have
    emerged.
  • Other countries introducing the Fourth Hurdle
    can learn from others experiences.
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