Pharmaceutical Executive Europe IMS Health Economics Supplement - December 2007 - (Page 4)

BIAs: The Fifth Hurdle? Few doubt the growing imperative for pharmaceutical companies to demonstrate the ‘value’ of new technologies. Mike Aristides considers the increasing importance of budget impact analyses in planning and forecasting and offers some insight into their constructs. afety, efficacy and quality tests are well understood and embedded in the drug development process; standard methods for performing and presenting the results of cost-effectiveness assessments (CEAs) are also increasingly familiar. This is particularly true in Europe, Australia and the USA. However, effective and timely market access for pharma products is increasingly contingent on budget impact analyses (BIAs). These new “must haves” assess the impact of a new drug or technology on a healthcare budget over a period of time, thereby providing key information for decision-makers — especially those with responsibility for national, regional, or local healthcare budgets — to facilitate budget planning and forecasting. Despite their growing importance in pharma’s armoury, evidence from health economics and outcomes research (HEOR) practitioners suggests that BIAs are frequently a ‘last minute’ affair from which full value is not always extracted in the sales environment. However, increasing interest in BIA capabilities suggests growing acknowledgment of their relevance and potential. For those who are new to health economics it is important to appreciate that BIA and CEA are two very different pieces of analysis. BIA is complementary to CEA, not a variation or replacement. S In CEA the cost and health outcome is presented for an average patient — usually in the form of the cost per quality adjusted life year (or QALY). So, for example, if £26000 per QALY is the ‘value for money’ of using a new medication, this can be compared with other current treatment. Such data is, however, never aggregated across the total number of patients and cannot be used to estimate a budget. Cost and outcomes vs financial consequences While CEA evaluates the costs and outcomes of alternative interventions over a specified time horizon to estimate and compare their economic efficiency, BIA considers the financial consequences related to the uptake and spread of new interventions and attempts to answer the question, “Can we afford it?” Indeed, a new treatment may be more efficient than the current option but nevertheless still be unaffordable. This creates something of a dilemma for primary care trusts (PCTs) and other budget holders. The National Institute for Health and Clinical Excellence (NICE) in England and Wales may have scrutinized the cost-effectiveness of a new intervention and approved its use in the NHS, but the implementation of this recommendation remains the headache of the budget holders. BIA helps them work DECEMBER 2007 HEALTH ECONOMICS 4

Table of Contents for the Digital Edition of Pharmaceutical Executive Europe IMS Health Economics Supplement - December 2007

Pharmaceutical Executive Europe IMS Health Economics Supplement - December 2007
Contents
Budget Impact Analyses: BIAs: The Fifth Hurdle?
Evidence and Effectiveness: Redressing the Balance
Commercializing HEOR: Adding Value

Pharmaceutical Executive Europe IMS Health Economics Supplement - December 2007