Clare McGrath

Framework for describing and classifying decision-making systems using technology assessment to determine the reimbursement of health technologies (fourth hurdle systems)

OBJECTIVES Australia, Canada, and many European countries now use various forms of health technology assessment (HTA) in decision making regarding the reimbursement of drugs and other health technologies. To achieve a better understanding of the potential for use of HTA in this context, an analytical framework was developed to describe and classify existing fourth hurdle systems. METHODS Based on a review of published literature, and official documentation, the key aspects of a fourth hurdle system were identified at two levels: policy implementation and individual technology decision. Characteristics of the systems were grouped under four main headings: constitution and governance, objectives, use of evidence and decision processes, and accountability. The comprehensiveness and relevance of this framework was assessed by an independent group of experts in HTA. A pilot study was undertaken, using only published sources, to test the feasibility of obtaining the information needed to complete the framework. RESULTS The framework was found to be sufficiently broad to encompass all the issues of interest regarding the systems, but the proportion of information available from published sources was variable between sections of the framework and between countries, with average availability of 45 percent. CONCLUSIONS The analytical framework will help researchers and policy makers in individual countries to understand their own systems and will allow some preliminary sharing of experience between countries. More experience of its application is needed to judge whether it will provide the basis for more formal comparison of systems and whether it will determine their appropriateness for particular decision contexts.

A dynamic perspective on pharmaceutical competition, drug development and cost effectiveness

Limited healthcare budgets result in payers adopting policies at national, regional or local level to achieve allocative efficiency in drug spending. Some of these aim at creating a link between pharmaceutical prices and the value they provide by setting a cost effectiveness (CE) threshold as the maximum acceptable ratio between incremental costs and effects of new drugs. The clinical effectiveness of the comparator used in those CE analyses tends to be greater over time, whilst, due to market competition and loss of exclusivity, their price is expected to be lower. At the same time, research and development (R&D) costs increase with inflation and with efforts to address regulation towards increased safety concerns. As effective patent times decrease, a minimum price constraint raises for the new entrant. These features occur at different rates across disease areas and are expected to result in differently shaped innovation curves. In this scenario, we demonstrate that a general arbitrary threshold may prevent further efficient R&D. Investment may be withdrawn before the optimum innovation point is reached and affordable clinical effectiveness may be lost. We conclude that disease-specific characteristics are an additional consideration in CE decision rules to accommodate the particularities of innovation across disease areas.