So what will persuade US payers to better support orphan drugs?
US payer concern at the number of new orphan drugs coming to market, often with eye watering prices attached, can obscure a more positive message: payers will support orphan drug pricing if pharma can prove utility and wider health economic benefit. Failure, however, to prove value or transparently justify your pricing policy, and you can expect ever more severe formulary restrictions. If some payers had their way, you'd be facing government intervention to limit prices.
Pharma's pricing of orphan drugs is seen by many as unjustified and that the industry is pushing payers too hard. There is much you can learn from payers and that is why, in October 2018, we interviewed frontline US payers to reveal in Orphan Drugs: US Payer Perspectives how they see the key issues playing out and what they want pharma to do to gain their support and not their anger.
Payer experts explore key questions
What the frontline experts say…
"The cost is extremely high and does not necessarily correlate to improved outcomes. There is a lack of efficacy or clinical benefit. This is of concern when you have a drug demonstrate statistical significance that is not considered clinically significant or a drug that demonstrates statistical significance in a measure that is not clinically valuable. There is also a lack of contracting opportunities and a lack of competition."
US Payer 7
"From a payer perspective, 'restrictions' is not the best word choice. Instead, we look at our measures as cost and medical necessity 'controls.' These controls include showing proof of medical necessity, documentation that other less costly treatment options were not effective, as well as other standard review and appeal processes to treat with drugs that are not on the member's formulary."
US Payer 8
""We need to develop a payer-agnostic registry to capture long-term outcomes data. This will help to define the long-term clinical value of these novel/expensive drugs. Pharma must become more transparent regarding drug development costs in order to ultimately establish a fair price and ROI for their products."
US Payer 1
"Early engagement will only be successful if there is a level of transparency that allows payers and pharma to address the pain points each party experiences with the launching of new orphan drugs. If there is transparency, payers will be able to contribute to the strategy of delivery and distribution. The more effective the distribution, the lower the cost the product can be."
US Payer 5
What to expect
A detailed report exploring the issues that are impacting US payers, based on:
Expert contributors
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