The Evolution of HTA in Emerging Markets Health-Care ... - TREE

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OHE Consulting Report for PhRMA 5 January 2011 according to economic theory. The sellers are, in fact, concerned the government has the upper hand, and that this will push down prices in face-‐to-‐face negotiation. Hence, the idea of international reference pricing becomes appealing, because it also reduces the costs of negotiation. And if international prices are related to “value” to the customer based on willingness to pay for health gain (reflecting also ability to pay, i.e., income levels), then the reference price could roughly be based on value. Thus, the reference price used to set the reimbursement level acts a ceiling on what manufacturers can obtain in their negotiation with hospitals, clinics, and other providers. Without knowledge of these discounts, it will not be possible to assess the actual cost-‐effectiveness of drugs in real-‐world practice. However, once a health care system is operating in a “second-‐best world”, where some prices different substantially from opportunity costs, economic theory suggests that it will not be straightforward to determine optimal prices. Smaller high-‐income countries like Taiwan have substantial segments of well-‐off individuals who expect access to the latest innovative medicines. If the US Food and Drug Administration (FDA) and the European Medicines Agency (EMA) have approved a drug, there is usually little reason to question access or spend substantial resources re-‐reviewing it. Basically, the Taiwanese government and NHI will provide access, but try to balance cost containment and access in order to maintain citizen support. Similarly, if the price is in alignment with similar countries, the government will have limited need to do a formal or very sophisticated HTA analysis. “Free-‐riding” or “piggy-‐backing” on other, similar countries’ assessments is the efficient and logical thing to do. Furthermore, when price is established by negotiation rather than by rule and transparency, then there is a greater potential for side deals and corruption. Nonetheless, if the international reference prices were too low (i.e., suboptimal) to support global R&D efforts, then the result would be dynamically inefficient (in the long run for all countries). On the other hand, the lack of a tight linkage between the government-‐established reimbursement level for new drugs and the acquisition cost (i.e., what manufacturers receive) means that Taiwan’s contribution to global R&D will be less than would be expected from the reference price. In a recent review of four European nations, Drummond, et al. (2010) reach a conclusion of potential relevance to Taiwan. Compared with HTA, reference pricing is a relatively blunt instrument for obtaining value for money from pharmaceuticals. Thus, its role in making reimbursement decisions should be limited to drugs which are therapeutically equivalent. HTA is a superior strategy for obtaining value for money because it addresses not only price but also the appropriate indications for the use of the drug and the relation between additional value and additional costs. However, given the relatively higher costs of conducting HTAs, the most efficient approach might be a combination of both policies. 104
OHE Consulting Report for PhRMA 5 January 2011 Appendix 4: Interview scope for the three emerging markets A4.1 HTA and your healthcare system a. What role does HTA currently play in the healthcare system of China/Brazil/Taiwan? Is there a written guideline or established process for HTA in China/Brazil/Taiwan? b. What role should HTA play in the healthcare system of China/Brazil/Taiwan? c. Do manufacturers have role in the current HTA process? d. What role should they play? e. Do you expect that HTA in your country will be able to adapt accordingly, if not why? f. How is HTA financed within your country? g. What status (for example advisory, mandatory etc.) does current guidance take, and do you expect this to change within the next 5 years? A4.2 Dissemination of information a. How are the outputs of any HTA processes disseminated? b. How are the outputs of HTA implemented and enforced? A4.3 Topic selection a. How are health technologies (topics) selected and prioritised for clinical and economic evaluation under the HTA system in your country? A4.4 Coverage of HTA in China/Brazil/Taiwan a. Should HTA in China/Brazil/Taiwan cover drugs, public health, surgery, other etc., which should have the greatest priority and why? 105
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