Value: A Balancing Act
When it comes to proving the value of a new medicine, pharma has to strike the right balance
There are perhaps few buzzwords bandied around in pharma circles as much in recent years as ‘value’. Companies are actively competing to stress value over volume and highlight their zealous efforts to go well ‘beyond the pill’ and deliver real value for every stakeholder in healthcare, from the patient up.
A cynic might suggest that such talk is simply pharma marketing speak but, with ever-tightened purse strings, payers are demanding that pharma delivers on its promises, as they seek to understand how much bang for their buck they can expect when they purchase drugs.
“We are over the tipping point,” says Zhen Su, SVP and Chief Medical Officer at EMD Serono. “There is a consensus and alignment that we need to collaborate and be problem solvers. We need to be able to convey the value, because, at the end of the day, we’re all part of the same value chain, from pharma to payers to the patients.
“If we don’t work together to be able to clearly communicate and demonstrate the value, we are going to be victims of a blame game within the system, which is neither productive or helps conveys our value to society,” says Su.
In many instances, pharma has been very efficient and practical about bringing long-term solutions to society, yet companies are “sometimes still painted as problem makers”, he adds. “This is a wake-up call for these parties to join forces and come together to champion value creation.”
When it comes to defining value – often a subjective concept – traditional methodologies have struggled to keep up with recent innovations, particularly in Su’s specialism of oncology. “As a result, it’s sometimes difficult to convey long-term value to the different stakeholders,” he says.
“I was talking to a chief scientific officer about this other day,” he says. “We agreed that in the future landscape, the patient – the end-user who is ultimately consuming these innovations – will carry more and more weight in helping payers and pharma define value. The increasing force in all of this conversation is the patient’s voice. This needs to be engaged with, incorporated, channeled and worked with.”
Data is the answer to the dilemma of the subjectivity of ‘value’, says Silvia Bäckström, Head of Value-Based Partnerships, Nordics/Baltics and Europe/Canada, at Takeda. “We can overcome this dilemma and unleash the full potential of real-world data when we embrace cross-sector collaboration between industry, clinics, doctors, nurses, payers and patients, whether you co-generate new data or utilize existing data. This will increase access to and acceptance of real world data”, she says.
“This provides a better understanding of a drug’s value beyond the clinical trial setting, and a clearer visibility of patient outcomes. Especially if you want to include quality-of-life data, which ideally would be reported by empowered patients themselves.”
This ensures everyone is able to get the full picture and better understand differences in care, outcomes and healthcare utilization, adds Bäckström. “By doing this, we can not only increase trust in real-world evidence, but also unleash the opportunities to better use and learn from them together.”
Yet, securing the right data to align with payers remains a significant challenge for the pharma industry, says Mata Charokopou, Market Access and Patient Value Lead at UCB. “We are seeing greater efforts around real-world data to capture long-term evidence, but we are discovering that payers sometimes doubt its quality. We can get evidence from the clinical trials, but some companies are more advanced than others in collecting and capturing the long-term benefits. I would say that we haven’t seen a great deal of improvement in the last few years.”
However, Charokopou sees mounting evidence that the pharma industry understands the importance of communicating value to payers. What’s more, efforts are underway to quantify the value.
“Greater efforts are being made to develop value frameworks that demonstrate how value goes beyond simple outcomes – it’s actually much more about what the patient needs. It isn’t easy to quantify this but, if the industry tries to demonstrate this in a consistent way, it can only be a good thing.”
With the notion of value inherently subjective, what a pharma company considers to be value for money might not be the same as a payer. In some cases, argues Charokopou, pharma might do better to focus on communicating the value of a drug with the patient in mind, as opposed to focusing solely on payer requirements that may not always be up to speed with patient expectations.
“With beyond-the-pill services, there are challenges for the industry in communicating the holistic value of the solution, rather than the product itself,” she says. “As a result, we are seeing industry doing more to involve the patient directly without even considering payer requirements. There is more at stake than just outcomes for payers and stakeholders – the patient.”
With treatments becoming increasingly targeted on specialized patient groups, the factors on which successful treatment pivot are complex, meaning clear communication channels are vital.
“It is essential to collaborate closely with healthcare providers and payers to co-create new funding solutions that are based on the value a treatment provides and, at the same time, contribute to the sustainability of health systems,” says Bäckström.
As a result, Takeda is one among many companies to have introduced pay-for-results and risk-sharing agreements with payers and national governments. Bäckström mentions such schemes in Sweden around inflammatory bowel disease (IBD) and in Estonia, where hospitals pay for its Hodgkin-lymphoma treatment on a performance basis.
However, not all countries are fully amenable to such agreements, she says. “Some countries are struggling to measure the outcome for specific patient groups and quantifying the value of a treatment or intervention. “Therefore, we are collaborating with various partners to co-develop innovative solutions that overcome these obstacles. In Finland, for example, we co-created a tracking infrastructure with wholesalers that enables hospitals to track and collaborate in outcome-based schemes for our IBD treatment,” says Bäckström.
There are other external challenges. For Charokopou, current European market regulations – under which real-world evidence and long-term evidence are not binding – are not always clear. “We’ve seen European regulations that try to capture and reflect the need for long-term evidence, which do add some hurdles to market access, but it’s still not mandatory,” she says. “It is deemed that you can still demonstrate value without long-term evidence, which is dependent on the disease as well as the expectations of the patient.”
Another factor is the dichotomy between well-established diseases and rarer conditions. “With rare diseases, we still experience difficulties when it comes to registries of real-world evidence. The need for personalized medication is still missing for these diseases; both industry and payers have a mandate to undress the unmet need.”
With a reductive eye, the value of a treatment is binary – both patient outcomes and costs to stakeholders. However, these two goals needn’t be mutually exclusive. “There is a tendency to focus on the cost of a treatment in isolation,” says Bäckström. “We need to broaden our view and look at the complete patient pathway including diagnosis, therapy, care and monitoring all together.
“Enhanced management of the whole patient journey can lead to better outcomes and maximize the value for the patient, payers and providers at the same time as reducing costs.”
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