Showing posts sorted by relevance for query confidential prices. Sort by date Show all posts
Showing posts sorted by relevance for query confidential prices. Sort by date Show all posts

December 18, 2016

The farce of confidential drug prices

We are approaching the end of cost-effectiveness as we have known. If you can't use the price of the drug because it is confidential, then there is no possibility of cost-effectiveness analysis. As far as Pfizer has sued a public agency because its officials have leaked the prices, then everybody that uses such information is at risk of being sued. I had already said that some time ago, when in our country we moved to confidential prices. This trend is ridiculous, getting better discounts comes at the price of opacity. And opacity is an extraordinary arm to prevent competition and constrain prioritisation. Qui prodes? It's up to you to get the answer, for me it's clear. If money comes from taxes, the citizens have to know the final price paid. The time to finish such farce has come.

PS. On why external reference pricing is meaningless (p.36):
The practice of lowering list prices through discounts, rebates and similar financial arrangements15 between public payers and the MAH is wide-spread. 22 countries reported that discounts, rebates or similar financial arrangements (e.g. managed-entry agreements such as risk sharing schemes) – either statutory (i.e. based on a law) or confidential (based on agreements) – are in place. As will be discussed later in more detail (cf. Chapter 4.1.2), the widespread use of the discounts and similar provides financial benefits to the country using it, but the other countries referencing to that country do not benefit from the lower prices since they refer to undiscounted higher prices.

Rembrandt. Self portrait
Current exhibition in Caixaforum - Barcelona

February 20, 2020

Confidential drug pricing without confidential prices

Performance-based managed entry agreements for new medicines in OECD countries and EU member states: How they work and possible improvements going forward

In this blog I've explained my position against confidential prices for drugs. However, there is an option to complicate it: confidential entry agreements. This is the current trend for high cost drugs with uncertain outcome. The report of the OECD explains the current situation in different countries and helps to shed light in this important issue. Just take this short statement and you'll be convinced of the complete mess:
It is difficult to assess to what extent performance-based MEAs have so far been successful. Few countries have formally evaluated their experience. Confidentiality of agreements continues to be a barrier to independent evaluation and little evidence is public. However, information available from expert interviews and from prior studies indicates that CED agreements have so far had a poor track record of reducing uncertainty around the performance of medicines. As a result, some countries have recently reformed CED schemes and some are discontinuing CED agreements altogether in favour of alternatives. The latter include restricted or conditional coverage without a MEA, whereby coverage is initially restricted to certain indications or patient groups and only broadened if and when additional evidence becomes available. Payment-by-result agreements continue to be used quite widely, but they do not always generate evidence
on product performance because data used for triggering payments are not always  aggregated and analysed.

September 5, 2018

Khan el-Khalili based drug pricing

When is it too expensive? Cost-effectiveness thresholds and health care decision-making

In one week of difference, the same technology: CAR T-cells has had two different options for drug pricing. Last week, under NICE review the answer was no to Gilead, and yesterday was yes to Novartis. The first paradigm applied to Yescarta is well known: marginal effectiveness should be acceptable at an affordable cost (NICE). The second one applied to Kymriah is based on preferences and willingness to pay under confidential prices. It is also a well known system specially at bazaars like Khan el-Khalili in Cairo.
This is an example of how two systems are applied in practice and nobody cares about it. I'm concerned about transparency, and that's why I can't understand why with public money the expenditure is confidential. I would agree if somebody explain the budget impact that have been agreed, otherwise with public money Kahn el-Khalili system is not acceptable. After more than four decades, Torrance would ask himself if all this effort on cost-effectiveness analysis has had any sense to arrive at this point.
Anyway, the remaining question is: when is too expensive? This is precisely what this editorial asks. And the and the answer (?) is:
For deciding whether something is too expensive, thresholds are crucial. Depending on which perspective is taken, the word ‘threshold’ may either refer to the consumption value of health or the marginal cost-effectiveness of current spending. 
This is a standard health economics perspective that no health politician nowadays will buy. Right now they are not buying the idea, and I think that they prefer confidential prices. It allows to reflect power,  discretionality, or even worse arbitrariness. Khan el-Khalili system has won.

June 9, 2017

The farce of confidential drug prices (2)

Payers’ experiences with confidential pharmaceutical price discounts: A survey of public and statutory health systems inNorth America, Europe, and Australasia

Some months  ago I posted on confidential drug pricing. I said that this was the end of cost-effectiveness as we have known. Now a new article reflects the evidence of my words:
Confidential price discounts are now common among the ten health systems that participated in our study, though some had only recently begun to use these pricing arrangements on a routine basis. Several health systems had used a wide variety of discounting schemes in the past two years. The most frequent discount received by participating health systems was between 20% and 29% of official list prices; however, six participants reported their health system received one or more discount over the past two years that was valued at 60% or more of the list prices. On average, participants reported that confidential discounts were more common, complex, and significant for specialty pharmaceuticals than for primary care pharmaceuticals.
If confidential discounts are huge (>60%), as they are, any cost-effectiveness analysis is adhoc and its obsolescence undermines any result. This fact is the recognition that the pricing system is not working and we are under a procurement system. As I said some months ago:The time to finish such farce has come.

January 30, 2013

Pharma confidential

We have just entered a new world. A confidential pricing market has been created!.  A complete new pharmaceutical market that Adam Smith couldn't realise. It's not a joke, it is what an official answered yesterday to the press. The Ministry can't explain the prices of prescription medicines not funded by NHS because they are confidential. The journalist was asking about the price of 400 medicines that were delisted from public coverage last September and why pharmaceutical firms have increased its price thrice. Does this make any sense? Do we need such regulator? Maybe a vacation is the best option . Last April a new regulation introduced the notified price, this is a free price that has to be notified for prescription medicines not funded by NHS. However, notified price it is not confidential price. That's the reason why we have to ask for compliance with the law, just that. The Comision Interministerial de Precios has not published any administered price since last June, and notified prices are considered confidential by the Ministry oficials.

April 24, 2015

A successful implementation of a bad idea

Since 2012 it hasn't been posible to know the price of new drugs funded by NHS. The government considers that they are confidential. This is a clear example of what exactly means transparency and the application of the rule of law. Meanwhile a new strategy has been put into place. Without public prices, the government has decided to set budget ceilings for several innovative drugs: pertuzumab, ivakaftor, telaprevir/simeprevir, abiraterona, pirfenidona y ruxolitinib. And the last one is new drugs for hepatitis C, defined as "therapeutic group" not as a specific molecule. Following this strategy there is a proposal to extend such a model of budget ceilings by ATC, therapeutic classification.
This is really a bad idea that is already being implemented. As you know sometimes there are good ideas badly implemented, and therefore criticized. But in this case, it is a bad idea with a scrupulous implementation. Some officials consider that if they set a budget ceiling, all decisions will be taken  to fit in with it. Clinical decisions follow a different path, not the mechanical and administrative way officials are used to.
The measure represents a tough hit to economic evaluation, because in the next future the government will not be any longer interested in it. Why? Their only concern is about the budget ceiling, the value doesn't matter. A missed opportunity for the development of priority setting under a rational scheme. Health economists should react to such a big mistake.
The saddest  issue is that nobody knows what will happen when the budget ceiling is surpassed. This will be the job for the next government, nobody cares about it right now. Democracy and rule of law are only words subject to interpretation.

PS. All the details about hepatitis C controversy at Boletín AES.

PS. Understanding the foundations of confidential drug pricing, in Forbes.

PS. Explained at Health Affairs:

International Best Practices For Negotiating 'Reimbursement Contracts' With Price Rebates From Pharmaceutical Companies
By: Morgan, Steven; Daw, Jamie; Thomson, Paige
HEALTH AFFAIRS  Volume: 32   Issue: 4   Pages: 771-777   Published: APR 2013

Reimbursement contracts, in which health insurers receive rebates from drug manufacturers instead of paying the transparent list price, are becoming increasingly common worldwide. Through interviews with policy makers in nine high-income countries, we describe the use of these contracts around the globe and identify related policy challenges and best practices. Of the nine countries surveyed, the majority routinely use confidential reimbursement contracts. This alternative to drug coverage at list prices offers benefits but is not without challenges. Payers face increased administrative costs, difficulties enforcing contracts, and reduced information about prices paid by others. Among the best practices identified, policy makers recommend establishing clear and consistent processes for negotiating contracts with relatively simple rebate structures and transparency to the public about the existence, purpose, and type of reimbursement contracts in place. Policy makers should also work to address undesirable price disparities within their countries and internationally, which may occur as a result of this new pricing paradigm.

January 11, 2019

The bill of new drugs

In the US there is a huge concern over drug prices. The question is what's driving expenditure growth, new product entry or inflation? In new product entry we have two categories, generic drugs and innovations (in specialty drugs). The answer appears in the latest issue of Health Affairs.
In this retrospective study of pharmaceutical pricing data for 2005–16, we found that increases in the costs of specialty and generic drugs were driven by the entry of new drug products, but rising costs of brand-name drugs were largely due to inflation in existing medication prices.
The costs of oral and injectable brand-name drugs increased annually by 9.2 percent and 15.1 percent, respectively, largely driven by existing drugs. For oral and injectable specialty drugs, costs increased 20.6 percent and 12.5 percent, respectively, with 71.1 percent and 52.4 percent of these increases attributable to new drugs. Costs of oral and injectable generics increased by 4.4 percent and 7.3 percent, respectively, driven by new drug entry. The rising costs of generic and specialty drugs were mostly driven by new
product entry.
We would need similar data for our country. Nobody knows anything, prices are confidential.

PS. On drug pricing scams.

Count Basie and the beginning of swing

April 1, 2017

Learning to say no

Cost effective but unaffordable: an emerging challenge for health systems

There are big questions unanswered in health policy, and the social willingness to pay for a costly and effective technology is one of them. In a recent article, a description and controversies of NHS budget impact policies are explained:
The budget impact test means that technologies costing the NHS more than an additional £20m a year will be “slow tracked,” regardless of their cost effectiveness or other social or ethical values. This risks undermining the existing opportunity costs framework.
Therefore if there is a costly and effective therapy that has an impact budget greater than 20m, than next steps are uncertain in UK. This is the setting.
Really this affects all health politicians, and the issue is related to prioritisation and price regulation. The "solution" to the first issue is to delay prioritisation to the next minister, and what it is possible is to renegotiate prices of drugs. As I have said many times, prices are a fiction, because what it is under negotiation is a contract with the government, therfore the whole amount (p·q).
Budget impact is essentially the price per patient multiplied by the number of patients treated. Yet the prevalence of someone’s condition should not determine their access to treatment. The principle of equity means that like cases should be treated as like; the NHS Constitution requires the NHS to respond to the clinical needs of patients as individuals.
Righ now in Catalonia cost-effectiveness is a also a fiction, since prices are confidential, and it is not possible to estimate the ratio. Budget impact is the option.

Prix Pictet. Photo Exhibition in Barcelona
You can't miss it

January 29, 2021

A plea for public patents on COVID prevention and treatment

 Funding of Pharmaceutical Innovation During and After the COVID-19 Pandemic

Extensive public investments also are being made in therapeutics. The 2 most prominent monoclonal antibodies (by Regeneron and Lilly) have come to market with substantial governmental support for product commercialization. Both products derive from therapeutic research platforms established with governmental support before the COVID-19 pandemic, but product commercialization and manufacturing received major additional investments in 2020. Separately, the National Institutes of Health (NIH) Rapid Acceleration of Diagnostics program has committed $1.5 billion to supporting development of diagnostic tests related to COVID-19. The specifics of the federal contracts largely remain confidential.

Why do they remain confidential? 

The lesson of the COVID-19 experience is that, when innovation in the life sciences is imperative, the traditional reliance on pharmaceutical industry prices and profits is jettisoned in favor of governmental grants and procurement. Sustained public funding for product development and commercialization will permit the sustained financing of innovation, a renewed attention to major public health needs, and the global position of the US pharmaceutical industry.

If there is public funding, why there aren't public patents? 

December 11, 2012

Opacitat i martingales: pharma confidential

Hi ha països que consideren que cal avaluar les innovacions, n'hi ha d'altres que ho diuen i no ho fan -ja sabeu de qui parlo-. Als primers, quan apareix un nou medicament cal mostrar que supera un llindar de cost-efectivitat admisible. Altrament només pot finançar-se pel ciutadà i no pel pressupost públic. La meva hipòtesi és que els llindars de cost-efectivitat pel finançament públic han portat a situar els nous preus en els límits 20.000-30.000 lliures per QALY. En alguns casos les farmacèutiques han intentat sobrepassar-lo i ho han aconseguit amb excepcions, però recentment s'ha complicat.
La novetat és que ara ha començat la carrera pels "descomptes comercials confidencials". A Bloomberg ho expliquen:
Pharmaceutical companies have dropped prices by as much as half to convince the body that advises the U.K. health system that their products help patients enough to justify the cost, the agency’s chairman said.
Companies have offered the state-run National Health Service “commercially confidential” price cuts when the National Institute for Health and Clinical Excellence has considered whether their medicines are cost-effective, NICE Chairman Michael Rawlins said in an interview. The number of treatments discounted in the past few years is in the double- digits, he said.
El que no s'imaginen és que amb això obren la caixa dels trons. Més d'un es pot preguntar si cal que prevalgui la transparència per sobre el descompte confidencial. Personalment encara algú m'ha d'explicar què vol dir descompte confidencial, si algú vol saber el preu final que s'ha pagat amb diners públics ho sabrà. Em temo que l'estratègia va dirigida a aquells països que encara no han introduït mecanismes d'avaluació de medicaments com el nostre. Els preocupa que es faci públic el preu final que es paga a països com el Regne Unit perquè aleshores demanaríem el mateix descompte. Però aquesta és tant sols una hipòtesi entre moltes altres. Prefereixo mercats transparents a opacitat i martingales.

PS. Estigueu atents al darrer moviment d'Amgen. Es mereix una entrada al blog.

November 21, 2013

Desperate discounts started

After the change of pharmaceutical pricing schemes in April 2012, the same product may have two prices, one for the National Health System and another for the citizen paying out of pocket. This scheme was put in place last January. Now it's a good moment to have a look at how it works.
For drugs sold on community pharmacies, NHS discounts range is 6-63%, and for specialty drugs 1-74% (!!!). You can check this statement in this table.
Does this make any sense?. I don't want to go further. I'm just confirming the situation after the regulator has paved the way: a desperate discounts process has started.

PS. Thinking critically, the former interpretation is wrong, discounts are not the issue. In order to be publicly funded, a discount gives higher satisfaction to the officials (anchoring). If this discount is confidential, still greater "satisfaction", because of fine tuning in the process of adjusting the cost per QALY to its expectations. A useless effort by the regulator (funded by our taxes), a successful effort for market access. As a citizen it is sad to be subject to such poor quality regulator, we can only expect to disconnect as soon as possible.

PS. Early impact of copayments, have a look at this post.