Current Challenges of affordability of Healthcare
in Ireland
Discuss the role of health economic evaluation in
determining the therapeutic drugs, devices and
treatment programmes that will be available in
Ireland
Economic evaluation and access to medicines
in the Irish Healthcare setting.
Michael Barry
National Centre for Pharmacoeconomics
November 2014
For discussion
• HTA of pharmaceuticals in Ireland
• Economic evaluation and cost-effectiveness threshold
• Issues with negative HTAs and drivers of HTA recommendations
• Recent challenges and opportunity cost
• Affordability
• Reference pricing
• Medicines Management Programme
When considering the pricing & reimbursement
of a new medicine there are two questions
Is it value for money ?
When considering the pricing & reimbursement
of a new medicine there are two questions
Is it value for money ?
&
Can we afford it ?
The NCPE conducts the health technology assessment (HTA) of
pharmaceutical products for the Health Service Executive
Recommendations on 192 medicines for 208 indications
3rd November 2014
Explicit cost-effectiveness analysis to
inform decisions
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Australia
Canada
Sweden
The Netherlands
United Kingdom
Ireland
New Zealand
“New products need to be compared with existing treatments …generic
measures of health outcome such as the quality adjusted life year (QALY)
are useful as a common yardstick of health care benefit”
Sculpher M. ISPOR Connections
FRAMEWORK AGREEMENT BETWEEN THE IRISH
PHARMACEUTICAL HEALTHCARE ASSOCIATION LTD
AND THE DEPARTMENT OF HEALTH AND THE HEALTH
SERVICE EXECUTIVE ON THE SUPPLY TERMS,
CONDITIONS AND PRICES OF MEDICINES
INTRODUCTION
The Association and the Department of Health and the Health Service
Executive have agreed on the terms set out below and this Agreement will
come into effect on 1st November 2012.
4.3 Pharmacoeconomic Assessment prior to reimbursement
“The HSE reserves the right to assess new and existing technologies
(pharmaceuticals, diagnostics and devices) that may be high cost or have
a significant budget impact on the Irish healthcare system, or to
determine the cost-effectiveness of products from time to time.”
www.ipha.ie
The HTA process
Rapid review to
determine whether a
full HTA is required
The process begins
with the price
application by the
manufacturer
Full HTA with a 90
day time frame
NCPE submission to the
HSE – CPU. This report
will be considered by the
New Drugs Group
Committee
Number of products reviewed by the NCPE 2006 - 2014
Economic evaluations conducted in the Irish
healthcare setting are usually in the form of
CEA or CUA.
Cost-effectiveness analysis (CEA)
e.g. COST/LYG
Cost-utility analysis (CUA)
e.g. COST/QALY
Cost-effectiveness threshold
The line passing through the origin represents our ‘acceptable’ costeffectiveness ratio. That is our maximum (or threshold) willingness-to-pay for
a unit of effect ( life year or QALY).
Cost (€)
Q4
Q1
Effect (QALY)
Q3
Q2
The QALY threshold to be used in the HTA process is € 45,000
Information for the decision maker following
pharmacoeconomic assessment

The cost effectiveness in terms of the incremental costeffectiveness ratio (ICER)
e.g. € 15,000/QALY

The probability of cost-effectiveness
e.g. 60% at the € 20,000/QALY threshold level

Expected value of perfect information
e.g. € 5,000,000
Products reviewed in 2014
• HTA not required = 24 (44%)
• Reimbursement recommended = 5 (9%)
• Full HTA required = 12 (22%)
• Reimbursement not recommended = 13 (24%)
5 at the submitted price &
7 oncology products
1st November 2014
Modelling issues with negative HTAs
• Incomplete modelling of the relevant clinical scenario (abiraterone)
• Validity of the chosen health states (Sativex)
• Uncertainty around the natural history of disease progression (teriflunomide,
Sativex)
• Time horizon (nab-paclitaxel, suboxone, regorafinib)
• The choice of survival model used to extrapolate progression free survival
(PFS) and overall survival (OS) beyond the trial period (brentuximab,
regorafinib, trastuzumab emtansine, nab-paclitaxel)
Modelling issues with negative HTA
• Lack of comparative efficacy data for treatment arms (vismodegib,
brentuximab)
• Data synthesis, indirect treatment comparisons (enzalutamide, luxisenatide,
canagliflozin)
• Pricing issues (canagliflozin, regorafinib)
• Utility values used in the modelling (nab-paclitaxel, Sativex, trastuzumab
emtansine, regorafinib, suboxone, enzalutamide, abiraterone, vismodegib)
Estimating revealed weights for a multi criteria decision analysis
approach to Health Technology Assessments: A case study in Ireland
The analysis confirms that recommendations for or against
reimbursement of technologies are driven by the following:
Cost-effectiveness (ICER)
Quality of available evidence
Safety & Tolerability
Innovation
Schmitz S. et al. 2013
Since September 2009 the cost-effectiveness of all
medicines is considered prior to reimbursement
under the Community Drugs Schemes
Health Technology Assessment & the public
Ipilimumab
‘Ippi’
“We believe the Company has failed to demonstrate the cost-effectiveness of
ipilimumab for the treatment of advanced melanoma in adult patients who received
prior therapy. We cannot recommend reimbursement at the submitted price”.
Price: € 85,000/patient
Budget impact: € 4,800,000 - € 7,400,000 per annum
Δ median overall survival = 3.6 months
Basecase ICER: € 147,899/QALY or € 92,443/LYG
September 2011
The Ippi controversy !
Final ICER ~ € 116,000/QALY
Opportunity cost !
Reimbursement of Ipilimumab (Yervoy®) – opportunity cost !
Original price – revised price: implications for the treatment of other
patients with serious medical conditions such as hepatitis C & MS e.g.
We could treat an additional 65 patients with Fingolimod (Gilenya) or
We could treat an additional 60 patients with Telaprevir (Incivo)
Recent challenges in reimbursement
‘new innovative medicines’
Cost effectiveness of crizotinib (Xalkori) for the treatment of adult
patients with previously treated anaplastic lymphoma kinase (ALK)
– positive advanced non-small cell lung cancer (NSCLC)
€ 6,242.00
Price: € 49,719/patient
Budget impact: € 1,610,893 per annum
Δ median progression free survival (PFS) = 4.7 months
No evidence of an overall survival benefit ( 20.3 vs 22.8 months)
Basecase ICER: € 165,616/QALY
Probability that crizotinib is cost effective = 5%
Cost effectiveness of crizotinib (Xalkori) for the treatment of adult
patients with previously treated anaplastic lymphoma kinase (ALK)
– positive advanced non-small cell lung cancer (NSCLC)
“At its current price the NCPE cannot recommend crizotinib as
a cost – effective treatment option. We do not consider the
health benefit to be sufficient to justify the proposed price”
NCPE 27th August 2013 (www.ncpe.ie)
Innovation – definition ?
“a new or existing medicine applied in a way which significantly
improves healthcare at a price the HSE can afford”
- does not have to be a new product
- does have to significantly improve heath outcomes
- does have to be affordable
there must be added value
Cost effectiveness of pertuzumab (Perjeta) in combination with
trastuzumab and docetaxel in adults with HER2-positive metastatic
or locally recurrent unresectable breast cancer who have not received
previous anti-HER2 therapy or chemotherapy.
€ 2,761.65
Price: € 74,000/patient
Budget impact: € 6,000,000 - € 9,800,000 per annum
Δ median progression free survival (PFS) = 6.1 months
An improvement in overall survival benefit has been seen
Basecase ICER: € 203,028/QALY
Probability that pertuzumab is cost effective = 2.5%
Cost effectiveness of pertuzumab (Perjeta) in combination with
trastuzumab and docetaxel in adults with HER2-positive metastatic
or locally recurrent unresectable breast cancer who have not received
previous anti-HER2 therapy or chemotherapy.
“The NCPE believes that pertuzumab is not cost – effective at
the submitted price and we cannot recommend reimbursement.
A significant price reduction is required to ensure value for
money”
NCPE 28th August 2013 (www.ncpe.ie)
Opportunity Cost !
€ 203,028/QALY Pertuzumab BC ?
Crizotinib NSCLC € 165,616/QALY
Cabazitaxel PC € 110,032/QALY
?
€ 116,000/QALY Ipilimumab MM
€ 112,905/QALY Vemurafenib MM
€ 105,420/QALY Abiraterone PC
Cost (€)
€ 16,023/QALY Telaprevir – Hep C
€ 11,411/QALY Boceprevir – Hep C
Effect
(QALY)
Opportunity Cost !
€ 203,028/QALY Pertuzumab BC ?
Crizotinib NSCLC € 165,616/QALY
Cabazitaxel PC € 110,032/QALY
?
€ 116,000/QALY Ipilimumab MM
€ 112,905/QALY Vemurafenib MM
€ 105,420/QALY Abiraterone PC
Cost (€)
€ 16,023/QALY Telaprevir – Hep C
€ 11,411/QALY Boceprevir – Hep C
Effect
(QALY)
Opportunity Cost !
€ 203,028/QALY Pertuzumab BC ?
Crizotinib NSCLC € 165,616/QALY
Cabazitaxel PC € 110,032/QALY
?
€ 116,000/QALY Ipilimumab MM
€ 112,905/QALY Vemurafenib MM
€ 105,420/QALY Abiraterone PC
Cost (€)
What is the € and
health outcome
value of this ?
Effect
(QALY)
€ 16,023/QALY Telaprevir – Hep C
€ 11,411/QALY Boceprevir – Hep C
Affordability !
Drug expenditure in Ireland
The Community Drugs Schemes
Ivacaftor for cystic fibrosis
Price of CF drug may be health cuts elsewhere
‘About one-third of the entire budget for new drugs this year will go
towards making new CF drug available’
nd
Irish Times 2 February 2013
Affordability – treatment of Hepatitis C infection ?
‘Following recent developments in the treatment of Hepatitis C virus (HCV) infection we
can predict that as early as 2015 sustained virologic response rates will exceed 90% for
most HCV genotypes’
This effective ‘cure’ will be achieved through short, interferon free, fixed dose, single pill
regimens with adverse effect profiles that are markedly better than those of past regimens
Potential budget impact – anywhere between € 200,000,000 - € 700,000,000
What is being done to improve access to medicines ?
Reference pricing
• The
HSE sets a price for the
original branded product and
its generics (phase 1 reference
pricing)
• Some 37 products have been deemed ‘interchangable’ and
22 products have been reference priced to date
• Atorvastatin ( Lipitor ) was the first drug to be reference
priced on 1st November 2013
• Esomeprazole ( Nexium ) followed on the 1st January 2014.
Reference pricing and Statins
Total expenditure on statins under the GMS scheme from Jan 12 - May 14
6,000,000
5,000,000
4,000,000
Simvastatin
€ 3,000,000
Atorvastatin reference
priced on 1/11/2013
Pravastatin
Fluvastatin
Atorvastatin
2,000,000
Cerivastatin
Rosuvastatin
1,000,000
€ 7,087,354/month
May-14
Apr-14
Mar-14
Feb-14
Jan-14
Dec-13
Nov-13
Oct-13
Sep-13
Aug-13
Jul-13
Jun-13
May-13
Apr-13
Mar-13
Feb-13
Jan-13
Dec-12
Nov-12
Oct-12
Sep-12
Aug-12
Jul-12
Jun-12
May-12
Apr-12
Mar-12
Feb-12
Jan-12
0
€ 3,534,412/month
Reference pricing and PPIs
Esomeprazole reference
priced 1/1/2014
€ 6,551,397/month
€ 4,212,521/month
The Medicines Management Programme (MMP)
• Multi-disciplinary Team – including the National
Medicines Information Centre (NMIC) and the
National Centre for Pharmacoeconomics (NCPE) in
collaboration with the HSE-Primary Care.
• Aim - sustained national leadership relating to
– Safe
– Effective
– Cost –effective prescribing
Statins - SIMVASTATIN
LANSOPRAZOLE
ACE inhibitor - RAMIPRIL
ARB - CANDESARTAN
SSRI - CITALOPRAM
SNRI - VENLAFAXINE
Antimuscarinics - TOLTERODINE
PPI -
The Medicines Management Programme (MMP)
HTA and the Medicines Management Programme
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•
•
•
•
Pregabalin (Lyrica)
Omalizumab (Xolair)
Lignocaine 5% plasters (Versatis)
Ezetimibe (Ezetrol) ??
Ezetimibe + Simvastatin (Inegy) ??
Affordability !
Delivering affordable cancer care in high-income countries
“The cancer profession and industry should take responsibility
and not accept a substandard evidence base and an ethos of very
small benefit at whatever cost: rather, we need delivery of fair
prices and real value from new technologies”
Sullivan et al, Lancet Oncol 2011;12:933-980
Delivering affordable cancer care in high-income countries
medical
“The cancer profession and industry should take responsibility
and not accept a substandard evidence base and an ethos of very
small benefit at whatever cost: rather, we need delivery of fair
prices and real value from new technologies”
Sullivan et al, Lancet Oncol 2011;12:933-980
“fair prices and real value”
Thank you
NCPE www.ncpe.ie