Panos Kanavos

Assessing the economic challenges posed by orphan drugs.

Historically, patients with rare diseases have been underserved by commercial drug development. In several jurisdictions, specific legislation has been enacted to encourage the development of drugs for rare diseases (orphan drugs), which would otherwise not be commercially viable. However, because of the small market, these drugs are often very expensive. Under the standard methods of health technology assessment (HTA) incorporating economic evaluation, orphan drugs do not usually prove to be cost-effective and this, coupled with their high cost, means that funding and patient access may be limited. However, these restrictions may not be in line with societal preferences. Therefore, this study discusses whether the standard methods of HTA are adequate for assisting decisions on patient access to and funding of orphan drugs and outlines a research agenda to help understand the societal value of orphan drugs and issues surrounding their development, funding, and use.

Competition in off-patent drug markets: Issues, regulation and evidence

In recent years health insurers have placed a great deal of emphasis on the ability of generic medicines to deliver significant savings to overstretched health care budgets due to their lower cost and potential for a more efficient resource allocation. In this paper we study market developments after patent expiry, whether health insurance captures the financial benefits from cheaper generics, and whether regulation and product differentiation, among others, have any power in explaining originator and generic price movements, generic entry and diffusion. We find that health insurance does not capitalize fully or fast enough on the cost advantage of generic medicines, either because generic policies do not encourage their fast uptake, or because generic drug prices are high and frequently tied, directly or indirectly, to originator drug prices. We also find that reference pricing, a particular form of reimbursement regulation, encourages generic entry and reduces generic prices but only marginally. Finally, in generic markets characterized by homogeneous products, we find evidence of product differentiation which is impacting prices upwards rather than downwards. If health insurance is to benefit fully from generic medicines, it ought to encourage faster uptake and price competition, and discourage price-fixing regulation that ties generic prices to those of originator brands.

Do generics offer significant savings to the UK National Health Service

ABSTRACT Background: The UK has traditionally had strong proxy demand-side measures favouring generic drug use, including prescribing guidance, financial incentives and encouraging generic prescribing. At distribution level, pharmacies are paid a salary for their dispensing work, based on volume dispensed, and procure generic products on the basis of discounts given to them by manufacturers or wholesalers. The supply-side has been subject to price regulation, and the recent requirement for manufacturers/wholesalers to report prices net of discounts to the DoH, indicate that reimbursed prices for generics may be higher than commodity level. Objectives: To investigate the level of discounts off the Drug Tariff Price made available to pharmacies and, determine whether the NHS could have a better deal than currently from generic drug purchasing. Data and methods: Data on net prices were acquired for different presentations of 12 generic molecules selected across different therapeutic categories and included in the 50 most selling generic prescription only products in the UK in the first quarter of 2005. For these products, 31 out of a possible 34 presentations (90%) were surveyed. The data sources were price lists of three leading full-line wholesalers (one national, two regional), out of a possible 11 full-line wholesalers (27.2%), and three leading generic drug manufacturers, out of a possible 15 manufacturers (20%). Results: Generic prescribing in the selected molecules was 94.6%, above the national average of 80%, and the total net ingredient cost (NIC) was £675 million, of which £607.5 million (90%) was generic. In 20 of the product presentations reviewed (64.5%), maximum discounts exceeded 60%, whereas in seven (22.6%) maximum discounts ranged between 50 and 60% off the Drug Tariff Price. Reimbursed prices for leading generic molecules are significantly higher than their pharmacy acquisition cost. Conclusions: The NHS is reimbursing generics at too high prices and a significant proportion of the reimbursed price accrues to the distribution chain in a fashion that resembles an indirect subsidy. The NHS can improve efficiency as well as increase savings, by purchasing generics closer to their market price. This would require changes in the way pharmacies are reimbursed, for instance, by changing the way the clawback is calculated, or altogether abolishing discounts and introducing a fixed dispensing fee; it could also mean introducing transparency in the determination of Drug Tariff prices by the relevant stakeholders. As the cost per generic script is, in the majority of cases, below the dispensing fee, the current reimbursement system for generics results in a re-distribution from patients and the NHS to the retail distribution chain.

Pars plana vitrectomy for vitreomacular traction syndrome: a systematic review and metaanalysis of safety and efficacy

Purpose: To determine the safety and efficacy of pars plana vitrectomy for vitreomacular traction. Methods: Articles reporting visual acuity change before and after pars plana vitrectomy were selected using a systematic literature review with predefined eligibility criteria. Visual acuities were converted to logarithm of the minimum angle of resolution (logMAR), weighted for study size, and pooled across studies. Safety outcomes were also pooled across studies. Results: Twenty-one of 460 articles were eligible. Mean (±standard deviation) logMAR visual acuity improved from 0.67 ± 0.55 to 0.42 ± 0.45 (n = 259 eyes) after pars plana vitrectomy (from 20/94 to 20/53 Snellen). In series of at least 20 eyes, mean visual acuity improved in all 5 studies (sign test, P = 0.0625). Of 392 eyes, 9.2% lost visual acuity, 11.7% were unchanged, and 64.3% improved; 32.9% of 217 eyes gained ≥2 Snellen lines. The most common postoperative complications were cataract (34.7% of 304 eyes; 63.2% of 68 phakic eyes), epiretinal membrane (5.7% of 348 eyes), and retinal detachment (4.6% of 348 eyes). Cataract surgery was undertaken in 10.5% of eyes. Conclusion: The visual acuity gains after pars plana vitrectomy for vitreomacular traction are relatively modest, but visual acuity change may not fully reflect symptomatic relief.

Symptomatic vitreomacular adhesion.

Background: Symptomatic vitreomacular adhesion describes symptomatic loss of visual function as a result of vitreous traction at the macula. Methods: Literature review. Results: Symptomatic vitreomacular adhesion can occur in isolation as vitreomacular traction, which may lead to the development of a macular hole, or it may occur alongside epiretinal membrane. It is likely to be associated with age-related macular degeneration and possibly diabetic maculopathy, although this is less certain. The treatment depends largely on the cause, but options include observation, vitrectomy, and pharmacologic vitreolysis. Small uncontrolled trials have also explored the use of an intravitreal gas bubble as a means of releasing VMA. If all cases of sVMA are considered together, then the burden of illness is substantial, with a prevalence of ∼0.35 per 100 population (excluding epiretinal membrane). Furthermore, there may be many more cases of undiagnosed sVMA. Conclusion: The recent introduction of ocriplasmin is likely to increase interest in sVMA. Clinical trials suggest that it has a role in the treatment of vitreomacular traction and Stages 1 to 3 macular holes but not primarily as a treatment of epiretinal membrane. Its role in other diseases associated with VMA remains to be determined.

Dealing with uncertainty and high prices of new medicines: A comparative analysis of the use of managed entry agreements in Belgium, England, the Netherlands and Sweden

Managed entry agreements are a set of instruments used to reduce the impact of uncertainty and high prices when introducing new medicines. This study develops a conceptual framework for these agreements and tests it by exploring variations in their implementation in Belgium, England, the Netherlands and Sweden and over time as well as their governance structures. Using publicly available data from HTA agencies and survey data from the European Medicines Information Network, a database of agreements implemented between 2003 and 2012 was developed. A review of governance structures was also undertaken. In December 2012 there were 133 active MEAs for different medicine-indications across the four countries. These corresponded to 110 unique medicine-indications. Over time there has been a steady growth in the number of agreements implemented, with the highest number in the Netherlands in 2012. The number of new agreements introduced each year followed a different pattern. In Belgium and England it increased over time, while it decreased in the Netherlands and fluctuated in Sweden. Only 18 (16%) of the unique medicine-indication pairs identified were part of an agreement in two or more countries. England uses mainly discounts and free doses to influence prices. The Netherlands and Sweden have focused more on addressing uncertainties through coverage with evidence development and, in Sweden, on monitoring use and compliance with restrictions through registries. Belgium uses a combination of the above. Despite similar reasons being cited for managed entry agreements implementation, only in a minority of cases have countries implemented an agreement for the same medicine-indication; when they do, a different agreement type is often implemented. Differences in governance across countries partly explain such variations. However, more research is needed to understand whether e.g. risk-perception and/or notion of what constitutes a high price differ between these countries.

Commonalities and differences in HTA outcomes: A comparative analysis of five countries and implications for coverage decisions

OBJECTIVE To identify diverging HTA recommendations across five countries, understand the rationale for decision-making in specific therapeutic categories, and suggest ways forward to minimize these inter-country differences. METHODS A comparative analysis of HTA recommendations for 287 drug-indication pairs appraised by five countries (England, Scotland, Sweden, Canada, and Australia) between 2007 and 2009, including an in-depth analysis of two case studies. Agreement levels were measured using kappa scores. Associations were explored through correspondence analysis. RESULTS Significant inter-country variability in the HTA recommendations exists: 46% of the drug-indication pairs studied received diverging recommendations across countries. The level of agreement between agencies was poor to moderate. Associations between HTA recommendations issued by each HTA body per therapy area (cancer, orphan, CNS) differed from the general pattern observed across the complete sample. Expectations from HTA bodies in terms of relative effectiveness differ depending on the drug and diseases characteristics, although agency-specific guidelines are homogeneous for all treatments. POLICY IMPLICATIONS Distinguishing and accounting for the specifics underpinning individual conditions and their characteristics in HTA processes may constitute a way forward to improved HTA methods, while increasing transparency in the expectations that HTA bodies have in terms of relative effectiveness of the drug depending on these characteristics.

Vitreous attachment in age-related macular degeneration, diabetic macular edema, and retinal vein occlusion: a systematic review and metaanalysis.

Purpose: To determine if there is an association of vitreous attachment and wet age-related macular degeneration (AMD), diabetic macular edema, and retinal vein occlusion. Methods: Systematic review and metaanalysis. Results: Sixteen of 1,025 articles were eligible. In wet AMD, the prevalence of vitreomacular adhesion and posterior vitreous detachment was 23% (654 eyes) and 41% (251), respectively. Vitreomacular adhesion prevalence was 2.15 times that of controls (95% confidence interval, 1.34–3.48; p = 0.002) and 2.54 times that of dry AMD (confidence interval, 0.88–7.36; p 0.09); posterior vitreous detachment prevalence was lower than controls (relative risk 0.77; confidence interval, 0.64–0.93; p = 0.007) and dry AMD (0.56; confidence interval, 0.27–1.14; p = 0.11). It was not possible to determine the prevalence of vitreous attachment in diabetic macular edema, but vitreomacular traction was present in 29% of 188 surgical cases. The prevalence of posterior vitreous detachment in eyes with central and branch retinal vein occlusion was 30% (56 eyes) and 31% (71 eyes), respectively, versus 25% (64 eyes) in controls. Conclusion: Observational studies of sufficient quality indicate that eyes with wet AMD have double the expected prevalence of vitreomacular adhesion and are less likely to have a posterior vitreous detachment. More controlled studies of diabetic macular edema and retinal vein occlusion are needed.

International Comparisons of Health Care Expenditures: What We Know and What We Do not Know

International comparisons of health care expenditures and their determinants have attracted considerable attention since the early 1960s and have since been used widely to compare countries. The impetus for this has been two-fold: firstly, to assess the macroeconomic efficiency of health systems by determining whether different methods of financing and delivering health care have contributed to the control of overall spending levels; and, secondly, to investigate the determinants of the level of health care expenditure. Empirical research has suggested that there is a causal and statistically significant relationship between growth in health spending and growth in gross domestic product (GDP), and that an increase in the latter brings about a proportionately larger increase in the former. This relationship holds even when other potential determinants, such as urbanisation and age structure of the population, are included in the analysis, leading to the conclusion that health care is a luxury good. This paper examines the extent to which this finding is valid from a methodological perspective and how far it assists policy analysis. We argue that there are significant problems in the measurement of health spending and GDP, discuss the methodological problems in the analysis and suggest that the observed relationship between GDP and health spending is unhelpful and almost certainly misleading for health policy development.

Medical technology procurement in Europe: a cross-country comparison of current practice and policy

Procurement policy can influence the diffusion of medical devices into national health systems, but limited comparative evidence exists on how countries procure such technologies. This paper discusses the procurement of select medical devices across five countries (England, France, Germany, Italy, and Spain) based on a review of published and grey literature and policy documents, as well as expert interviews. All countries have introduced various regulatory or policy measures that implicitly or explicitly influence device procurement, from lists of devices for purchase to changes in financing mechanisms. There has also been movement toward more centralized procurement with the introduction of purchasing groups or consortiums, notably in England, France, Germany, and Italy. While a number of stakeholder groups are involved in purchasing activities, a greater, more formalized role for physicians and governments is needed to ensure that technologies procured best meet patient needs and align with national health care priorities and other sectoral objectives. A general theme across all national procurement systems was a focus on cost-containment, but like other areas of technology policy (e.g., coverage), basing purchasing decisions on a broader range of criteria, such as quality and health outcomes, might better allow governments to achieve value for money and support patient access to beneficial innovations. More research is needed, however, to substantiate the role and influence of procurement on balancing the adoption and affordability of medical technologies.