BIO President and CEO Jim Greenwood has defined value-based agreements as an important part of “the future of drug pricing.” In an op-ed published by The Hill, Greenwood wrote:
“Doctors and hospitals are increasingly being paid not for the quantity of care they provide, but for the outcome or quality of care patients receive. The emerging trend in health care is about rewarding value, rather than volume. This is the future, where there is less focus on the number of tests or treatments a patient receives and more focus on whether a patient’s health is improving. ….
“With a new wave of breakthrough cures and therapies expected in the coming years, ensuring prescription drugs are accessible and affordable will remain an important concern for drugmakers, policymakers, and the broader public.”
Value-based agreements must play a vital role if we are going to achieve both accessibility and affordability for all patients who rely on prescription medicines. However, that’s easier said than done. Defining and then communicating the value of a cure or treatment is no easy task, and it often depends on one’s point of view, whether a patient, drugmaker, payer, or other entity.
This increasingly important issue was the topic of a panel discussion at BIO’s 2018 International Convention. The panel session, entitled “Communicating Value Through the Eye of the Beholder,” was moderated by Meg Alexander, who leads the Reputation and Risk Management Practice at Syneos Health. Joining Alexander for the discussion were:
- Richard Pops, chairman and CEO of Alkermes;
- Barry Greene, president of Alnylam;
- Dr. Grace Cordovano, founder of Enlightening Results; and
- Dave Boyer, a principal at BGR Group.
All panelists recognized that the biopharmaceutical industry faces more scrutiny over the cost of prescription medications, which raises the urgency of clearly and accurately communicating the value of medicines — particularly more costly innovative medicines for patients facing rare diseases.
Pops stated that people are often “skeptical” of the initial price, because “we don’t do a good enough job explaining why we picked that price in the first place.” He added that we have “this amazing social contract,” whereby drugmakers enjoy price protection for a limited period of time to generate the revenue necessary to fund more and more research so that the “ecosystem flourishes.” Pops noted that this cycle of innovation doesn’t get enough attention.
Asked what would help patients better understand the value of medicines, Cordovano spoke of a disconnect between the biopharmaceutical innovators and the patients they seek to help. But she was optimistic, saying “we are seeing this moving towards being patient centered, patient first, which is definitely moving in the right direction.”
Cordovano added that in her perspective, “It’s not enough to just talk to patients. We need to partner with them. We need to partner with patients and care partners.” She noted this should take place throughout the drug development process, whether in initial clinical trials or at the launch of a new drug. Doing so will help the patient community better understand the value of the medicine being delivered.
Both Pops and Greene spoke about their experiences creating opportunities to facilitate patient engagement, helping to fully understand the patient experience and provide the infrastructure necessary to provide access to the medicines they may need. Greene described how this journey has evolved over the more than 10 years Alnylam has worked to develop therapies for a number of rare diseases.
Speaking specifically about value-based pricing, Green noted that many in the past only moved through this innovative pricing model after access was denied by payers. He noted that Alnylam decided to take a more proactive approach, and it’s their hope to have multiple agreements in place at or soon after the launch of their first novel drug. He noted that they are confident it will work to facilitate patient access and ultimately make good business sense in the long run.
Boyer cautioned that while value-based agreements are important, they “are not a silver bullet.” He also urged industry to avoid allowing the value of a drug to be determined by “policymakers using a financial spreadsheet.” Indeed, he and others on the panel emphasized the need to get value assessment of prescription medicines right.
Greene explained that “a fair assessment can be helpful, but a biased assessment that’s meant to beat down price and restrict access is not helpful.” He then added flawed assessments can actually have a chilling effect on the ability to raise capital, invest in future biopharmaceutical innovation and provide patients the new therapies they need.
Filed under: Events, Health, 2018 BIO International Convention, Barry Greene, BIO 2018 Event Highlights, BIO Events, BIO International Convention, BIO2018, Biopharmaceutical innovation, convention highlights, Dave Boyer, Grace Cordovano, health, Jim Greenwood, Medication, Meg Alexander, Richard Pops