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Drug Reimbursement: Make Room at the Table for Patients and Researchers


Pharmaceutical Executive

At last week’s Partnering for Cures conference held in New York City, several expert panels discussed new angles of approaching solutions to disease, encouraging investment and mitigating inefficiencies in the delivery of medicines within the current healthcare system.

At last week’s Partnering for Cures conference held in New York City, several expert panels discussed new angles of approaching solutions to disease, encouraging investment and mitigating inefficiencies in the delivery of medicines within the current healthcare system. A highlight was a session on  “Reimbursement: Can Value Drive Innovation?,” which looked at  defining value in meaningful ways and using new models to engage  payers early on with patients and researchers in developing solutions that achieve simultaneously  cost-savings and advances in medicine.

Beginning the panel discussion, Stephen J. Ubl, President and CEO of AdvaMed, explained that the medical device industry, much like pharma, operates within an increasingly challenging business environment.  He noted venture investment has dropped 40% and it now takes 75% longer to achieve a technical breakthrough than it did in 2007. In response, there is growing interest in transitioning from a fee-for-service based model to one that is more value-based. In order to achieve this transition, he explained, companies that drive medical innovation must find a way to collaborate with payers to aggregate data demonstrating the value of preventive care and facilitate more long-term savings within the healthcare system. This also means developing a payment-neutral environment that provides financial incentives and benchmarks to persuade physicians to adopt new technologies, he said.

Jo Caroll Hiatt, Chair of Kaiser Permanante’s National Product Council, cited the healthcare group’s affinity for attracting physicians who are willing to embrace new processes for treating patients with technologies. Aside from its providers’ zest for shiny new objects within the group, Kaiser, as Hiatt relayed, is more concerned with outcomes than with cost in evaluating the merits of early stage adoption of new tools and therapies. Secondly, Hiatt stressed that recruiting competent, adaptive physicians is difficult when facilities are unwilling to move forward. Hiatt observed that some technologies, the Da Vinci surgical system for instance, may not see better outcomes early on, but urologists still want to work with it in order to familiarize themselves with what is the cutting edge.

Taking the patient-centric view, Bob Beall, President and CEO of the Cystic Fibrosis Foundation, argued that just as patient engagement is a way to de-risk investment in biotech companies, bringing patient groups to the table with insurers will be essential to improving benefit assessments for new therapies, essentially de-risking the reimbursement process as well. Advocacy groups, he urged, need to be more active in developing data beyond FDA approval  trials  to show a body of evidence in therapies they are interested in. “We have access to patients and can recruit globally, we can get patient reported outcomes, so let’s provide that data to payers as early as we can,” Beall said. He went on to say that currently, access control mechanisms like prior authorization are a burden that exceed their benefit in terms of costs; these tools consume precious time and are therefore a source of stress on the health care system. If patient groups, in being given a more formal seat at the table with payers and insurers, can help to demonstrate a drug’s utility in a particular disease area, the burden of prior authorization might not be necessary.

Shari Ling, Deputy Chief Medical Officer of the Center for Medicaid and Medicare Services’ Center for Clinical Standards and Quality (CCSQ) advocated for higher quality as a means to stabilize or lower cost.  To raise efficiency, Dr. Ling said that it makes more sense for patients and their corresponding organizations to define outcomes in a manner that is meaningful to the patients themselves. Additionally, it would be wise to look across disease states to define what is common to different patient populations when looking for relevant, measurable and realistic outcomes.

Beyond the patients, payers may want to look into working earlier with the innovators themselves to determine what technology is worth scaling. Alan Russell of Carnegie Mellon’s Disruptive Health Technology Institute (DHTI) and Allegheny Health Network discussed his frustrations with barriers in clinical practices, which often prevent new innovations from reaching patients. Payers, he says, could be involved at this step in the process to help pay for and expedite the development of innovative medical products and therapies. He points to Carnegie Mellon’s recent collaboration with Highmark Blue Cross Blue Shield, which agreed not only to invest in innovative practices and data, but to apply that data to inform where to improve and innovate.

While panelists agreed that there are new ways to move forward in shaping reimbursement models, questions about what insight the Patient Centered Outcomes Research Institute (PCORI) as well as the arena of comparative effectiveness have generated were met with blank stares. “I have not seen actionable data from PCORI’s work to date,” Hiatt said of the two year old organization’s efforts. In discussing next steps on Medicaid expansion under the Affordable Care Act, Ling asked that state authorities be more transparent in their policies and procedures, so that measuring quality of medicines is not sacrificed in an effort to simply contain costs for the short-term.

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