Announcements from South Korea (SK) to Denmark (DK) pave the way for further outcomes-based contracting for high-cost oncology drugs
Multi-indication and combination therapies are rapidly influencing the oncology marketplace. Faced with increasing treatment complexity and budget demands, payers across the globe are starting to evolve their approach to contracting.
In South Korea the National Health Insurance Corporation’s Pharmaceutical Management Department has stated1 the Corporation’s desire to:
Improve the risk-sharing system by upgrading it to achieve rapid listing of high-cost drugs
Consideration to improving related systems, such as expanding the scope of drugs subject to performance-based refund contracts from one-shot treatments to high-cost drugs and adding types of financial sharing plans must be given
Discuss measures to reduce administrative burden with related organizations and the pharmaceutical industry
Likewise, Denmark’s HTA agency, the Medicines Council, can now make conditional recommendations for coverage of hospital drugs that treat severe disorders, have significant unmet clinical need and are associated with uncertainty regarding their efficacy, safety or cost2. If the Medicines Council decides not to recommend a drug as a standard treatment, it will simultaneously decide whether the product is eligible for a conditional recommendation. In that event, Amgros and the company will negotiate a price that will apply during the data collection period, as well as the terms for financing the data collection.
From 2022, a four-year pilot project will evaluate risk sharing for five medicines. The health service will cover the cost of treatment for a designated number of patients, with manufacturers paying the costs of any additional patients.
Partnerships with NICE International is influencing HTA and access decision making in both countries, in particular, helping Amgros to tackle challenges in the procurement and reimbursement of high-cost medicines. Amgros has shown particular interest in the Cancer Drugs Fund, which relies heavily on coverage with evidence development.
With oncology remaining a major focus for drug development and ever-constrained payer budgets, innovation in contracting is a trend that is set to continue. It is therefore vital that manufacturers have a variety of strategies for their oncology products, as ‘one size does not fit all’.
Author
Omar Ali
BSc(Hons)Pharm DipClinPharm MRPharmS ACPP
Head of Payers, Verpora
LinkedIn
Qualified with a hospital pharmacy background Omar started as a formulary payer within the managed care setting. For over 15 years he sat on payer P&T committees with responsibility for the allocation of drug budget, access, and reimbursement. At a national-level, Omar served as a NICE national HTA adviser for nine years across three committees evaluating cost-effectiveness, budget impact/ affordability and value-based agreements. Omar has spent the last ten years leading a global network of over a hundred current & former payers that specialise in value-based contracting. Omar’s team provides the inside track on creating innovative contracts that will work. Omar has embarked on a Ph.D. entitled, “Value-Based Pricing & Outcomes-Based, Innovative Contracting of New Medicines”. He is a visiting lecturer in value-based contracting at the University of Portsmouth, UK.
Sources
Disclaimer
Content in this article is based on secondary market research using externally sourced data available in the public domain. Opinions and commentary are those of the authors and do not reflect views of any commercial organisation or government body mentioned in the article. For any questions relating to the article please contact adam.meads@verpora.com.
