Value-based indication-specific pricing and weighted-average pricing

• Verfasst von: Michaeli, Daniel [VerfasserIn]
• Verfasst von: Michaeli, Christoph T. [VerfasserIn]
• Titel: Value-based indication-specific pricing and weighted-average pricing
• Titelzusatz: estimated price and cost savings for cancer drugs
• Verf.angabe: Daniel Tobias Michaeli, Thomas Michaeli
• E-Jahr: 2025
• Jahr: April 2025
• Umfang: 13 S.
• Fussnoten: Online veröffentlicht: 30. Dezember 2024 ; Gesehen am 24.03.2025
• Titel Quelle: Enthalten in: PharmacoEconomics
• Ort Quelle: Berlin [u.a.] : Springer, 1992
• Jahr Quelle: 2025
• Band/Heft Quelle: 43(2025), 4 vom: Apr., Seite 415-427
• ISSN Quelle: 1179-2027
• DOI: doi:10.1007/s40273-024-01448-x
• Datenträger: Online-Ressource
• Sprache: eng
• K10plus-PPN: 1920418199

Abstract

Objectives For US Medicare and Medicaid, single drug prices do not reflect the value of supplemental indications. Value-based indication-specific and weighted-average pricing has been suggested for drugs with multiple indications. Under indication-specific pricing, a distinct price is assigned to the differential value a drug offers in each indication. Under weighted-average pricing, a single drug price is calculated that reflects the value and/or volume of each indication. This study estimates price reductions and cost savings for cancer drugs under value-based indication-specific pricing and weighted-average pricing. Methods We collected data on US Food and Drug Administration (FDA)-approved cancer drugs and indications (2003-2020) from FDA labels, the Global Burden of Disease study, clinicaltrials.gov, and Medicare and Medicaid. A multivariable regression analysis, informed by characteristics of original indications, was used to predict value-based indication-specific prices for supplemental indications. These indication-specific prices were combined with each indication’s prevalence data to estimate value-based weighted-average prices and potential cost savings under each policy. Results We identified 123 cancer drugs with 308 indications. Medicare and Medicaid spent a total of $28.2 billion on these drugs in 2020. Adopting value-based indication-specific pricing would increase drug prices by an average of 3.9%, with cost savings of $3.0 billion (10.6%). However, 43.7% higher prices for ultra-rare diseases would increase spending by 16.8% ($44 million). Adopting value-based weighted-average pricing would reduce prices by an average of 4.6% and spending by $3.0 billion (10.6%). Under weighted-average pricing, prices for and spending on ultra-rare diseases would be reduced by 22.6% and $55 million, respectively. Conclusions Value-based indication-specific and weighted-average pricing could help to align the value and price of new indications, thereby reducing expenditure on drugs with multiple indications.