By Dan Leonard, President (National Pharmaceutical Council)
This article appeared in the January 4, 2016 edition of Chain Drug Review.
Last year, in our 2015 Health Care Outlook published in Chain Drug Review, I highlighted the recent announcement by the U.S. Department of Health and Human Services (HHS) around its efforts to shift our health care system from one that focuses on volume to value. One year later, the government and many stakeholders across our healthcare system—including the National Pharmaceutical Council (NPC)—remain united in working toward a system that rewards quality care over paying for the quantity of care.
While there is significant and broad-based agreement on moving toward a value-based system, the gulf between what is perceived as high value and low value may actually be widening—and, perhaps even more concerning, patients’ views around value are not at the center of this discussion. That’s why these converging issues—including improving meaningful patient access to medicine and incorporating the patient voice; defining the value of therapies; using high-quality, real-world evidence to inform our decisions; and supporting true innovation that improves patients’ lives—must be at the heart of our work in 2016 and beyond.
Understanding the Ultimate Value of Therapies—How Innovation and Access Come Together
We are living in one of the great moments in history with regard to the treatment and curing of disease.
In the last century, average life expectancies have grown from 47 years to 78 years. In the last 20 years, death rates from AIDS-related illnesses have declined 80 percent and cancer deaths have decreased 20 percent. And in just the last two years, hepatitis C has become a curable disease.
All of these major advances are the result of breakthrough discoveries and continued advances in new medicines for patients. And with more than 7,000 new medicines under development worldwide, I believe that a wave of new discoveries to treat and cure numerous diseases—and improve the quality and longevity of life—for millions of patients around the globe is just beginning.
Yet in spite of all of this medical progress, the common theme at almost every meeting I go to and the focus of the media on a daily basis is the exorbitant cost of care—and, more specifically, the cost of new drugs. I believe this is a myopic approach, because when we limit our focus solely to the price of a therapy, we lose the opportunity to focus on the real issue at hand: the full value of biopharmaceuticals over a patient’s lifetime.
For example, the debate over recent hepatitis C treatments has received significant attention from a number of stakeholders. However, as Donna Cryer, president and CEO of the Global Liver Institute, shared, to patients who have received these treatments and are now looking forward to a lifetime free of the disease, “[t]he value…is almost incalculable. Returning to life, work, having and taking care of children, lessening the worry of developing liver cancer, and being acknowledged as a member of society worth saving.” That is the measure of value from the patient’s perspective and it is a value that will be accrued through a long and full life.
At the same time, payers have been wrestling with how to pay for these highly effective treatments for patients within their one-year budget windows. Unfortunately, when the value of biopharmaceuticals is discussed in this kind of vacuum, rather than as part of our entire health care system over time, it’s to the detriment of everyone—including patients.
For instance, one way payers have traditionally addressed these budgetary issues is through offering plans with a low premium and high deductible. As a result, patients who have chronic or complex illnesses and are enrolled in these types of plans are often burdened with high out-of-pocket costs, which may lead them to ration or skip their medications. This can lead not only to costly and avoidable hospital visits for that patient, but forgoing use of the most effective treatment also can mean large downstream costs to our overall system.
Over the next year, as stakeholders across our health care system continue to consider new solutions for how we can better align coverage to the clinical benefit and overall value of a therapy for each individual patient and to reward quality care, we will need to work together to understand how to best measure the value of therapies and services to our health care system.
Measuring and Rewarding Value—Addressing Limitations and Gaps to Strengthen Patient Access
Breakthroughs are occurring beyond the laboratory that are having significant impact on how treatments work in the real world through advances in big data. Through the growing use of electronic health records, mobile health devices and claims data, the biopharmaceutical industry and payers have been able to form meaningful collaborations to study and better assess how to effectively tackle a range of challenging conditions.
And while using health care data to better understand how treatments work, how that evidence is evaluated, and the best way to use the data collected in everything from insurers’ coverage determinations to providers’ treatment decisions is an important opportunity for stakeholders across our system—it is still a work in progress.
As we move forward, NPC will continue to work with a range of experts and other stakeholders to develop best practices for using data, real-world evidence, and value assessments to ensure we can truly move toward a system that puts value and patient access at its center.
The Value in Innovation—Where Do We Go From Here?
Not too long ago, at yet another industry conference, a senior executive from a national health plan was asked what his biggest hope and biggest fear were for American health care. His answer perfectly captured the challenging paradigm—and reality—of our current health care system.
His biggest hope: that an innovative biopharmaceutical company would develop a cure for Alzheimer’s. His biggest fear: that an innovative biopharmaceutical company would develop a cure for Alzheimer’s and we wouldn’t be able to afford it.
But as a society, can we afford to NOT encourage our scientific community to do everything in its power to work toward this big breakthrough?
In purely economic terms, America would save $367 billion in health services costs by 2050 if a new medicine was developed that delayed the onset of Alzheimer’s by just five years. In purely human terms, the value to those patients and their loved ones benefiting from new treatments is again, incalculable.
In the year ahead, NPC will be working on numerous health policy topics in the areas of:
How generating and understanding best evidence can be used in medical decision making;
How to better demonstrate the full value of pharmaceuticals to the individual patient and to society at large;
How issues of access to medicines impact patients’ health; and
How critical continued innovation is to the overall sustainability of our health care system.
We look forward to having a constructive conversation and working with stakeholders across the spectrum about how true value is understood and attained through the patient perspective.