The controversial approval last month by the Food and Drug Administration (FDA) of Aduhelm (aducanumab) for patients with early-stage Alzheimer’s disease has caught the attention of patient groups, clinicians, decision-makers and market analysts. Priced at $ 56,000 on an annual basis (wholesale acquisition cost, WAC), Aduhelm has the potential to be a mega blockbuster, especially since millions of Alzheimer’s patients may be eligible for the drug.
At this point, however, it is unclear how Medicare and commercial payers will manage Aduhelm’s coverage locally and nationally. Insurers can look to the Institute for Clinical and Economic Review (ICER) to inform their reimbursement, and possibly even pricing, decisions regarding Aduhelm. The ICER estimates that Aduhelm would be profitable at a price between 85% and 90% lower than the WAC of $ 56,000. In a revised report released two days ago, the ICER says there is insufficient evidence to demonstrate Aduhelm’s net benefit to the health of patients with Alzheimer’s disease.
The ICER is well known for these types of evidence-based valuation assessments that attempt to align price and value to arrive at a “fair price”. If the price of a drug is fair, it is essential that payers reciprocate by providing patients with “equitable access”. The ICER is currently testing the principle of equitable access to pharmaceuticals at a fair price and examining possible barriers that could hinder sustainable access to medical technologies. Specifically, the ICER convened a multi-stakeholder working group to advise its new annual initiative launched in May.
So what exactly do we mean by “equitable access?” Well, in September 2020, the ICER released a white paper titled “Cornerstones of ‘equitable’ drug coverage: Appropriate policies for cost-sharing and management of drug use. This article analyzes the ethical and practical dimensions of the health insurance coverage policy. At the same time, the document presents a set of criteria which, in the opinion of the ICER, support an open and constructive debate among the main actors of health on the question of whether certain insurance policies offer access. “Fair” to prescription drugs.
To begin its review of barriers to equitable access, the ICER will assess the coverage policies of 15 of the largest U.S. commercial payers to determine if there are unnecessary barriers, such as high cost sharing by patients or potentially onerous reimbursement terms such as phased changes for access to 28 drugs The ICER has determined that they are fairly priced.
The ICER recognizes that fairness is in the eye of the beholder and that this value can also be subjective. Nonetheless, a good starting point for stakeholders to reach consensus is to agree that the alignment of price and value is right.
In the economy, in competitive markets with no barriers to entry, no information asymmetry and no moral hazard (insurance coverage lowers a person’s direct expenditure on care, which can lead to overuse health care), and with complete and transparent information, price and value are one and the same. But in imperfect and sub-optimal markets, including healthcare, price and value don’t necessarily align.
In the world of Medicare, there are a number of examples where the degree of patient access to a drug is related to its value. For example, the value-based insurance design (VBID) reduces direct patient cost sharing for drugs of proven value and increases cost sharing for drugs of no proven value. The concept has been around for almost 15 years and has been implemented in many contexts, but not systematically. VBID has not necessarily linked equitable access to a fair price, but it has linked the degree of patient access to a product to its value.
This brings us back to the example of Aduhelm. The price of Aduhelm arouses the ire of some, especially those who would press for Medicare to negotiate the prices as a single entity. Some have even suggested that Aduhelm could become the watershed for drug pricing reform in the United States.
Rather than introducing arbitrary price caps, a drop in Aduhelm’s net price could perhaps be aligned with a fair access proposition, namely a corresponding removal of barriers, such as high cost sharing by patients. and other refund conditions, such as phased changes and quantity limits.
Whether or not the ICER’s equitable access to medicines at a fair price is implemented for a therapy such as Aduhelm, this is an important initiative with broad implications for the pharmaceutical market as a whole. . Fair pricing of pharmaceuticals – in which price and value are aligned – and equitable access – in which patients can actually get high-value care with minimal restrictions and user fees – are two key objectives of the pricing and reimbursement. ICER can play a constructive role in this regard.