Opportunities and Challenges for HTA in Asia-Pacific (Part 1)

1
Opportunities and Challenges for HTA in Asia-Pacific
Part 1 of 2
A roundtable interview.
AUDIO INTERVIEW!
Turn on your speakers.

Opportunities and Challenges for HTA in Asia-Pacific
IMS Experts:
Mandy Chui, Practice Leader, Pricing and Market Access, APJ
Jonathan Tierce, GM, Health Economics & Outcomes Research
Guest Speakers:
Dr. Annie Chicoye, Associate Professor, ESSEC Santé Business
School France - Singapore
Dr. Abdulkadir Keskinaslan, Market Pricing Director, APAC,
Novartis Pharma AG Basel, Switzerland
Length: ~15 minutes
To download an MP3 of this interview, click here.
To download the PDF transcript, click here.
Questions? Comments? Fill out the form at the end of this presentation.

3
Hello and welcome to the IMS Asia-Pacific Insight
interview. My name is Jonothan Tierce, the IMS General
Manager of our Health Economics and Outcomes
Research practice area. Today I am here with three
experts who are going to talk about the opportunities
and challenges for healthcare improvement and value in
the deployment of medical technologies in emerging
markets in Asia.

4
To start, I would like to introduce Ms Mandy Chui. Mandy
is Regional Practice Leader, Pricing and Market Access at
IMS Health in Asia Pacific, where she leads engagements
to help clients in China formulate growth strategies,
optimize price and reimbursement, and address issues in
business model, sales force and marketing optimization.
Welcome Mandy.
Know more on IMS Health, click here
Mandy Chui (MC): Hello Jon.

5
We are also joined by Dr. Annie Chicoye. Annie is an
Associate Professor at ESSEC Santé Business School
France - Singapore, with extensive experience
conducting assignments related to medicinal products
and medical devices, as well as health economics
studies, healthcare organization and networks projects.
Welcome Annie.
Annie Chicoye (AC): Thank you Jon.

6
And finally our third panellist – Doctor Abdulkadir
Keskinaslan. Abdulkadir is Market Pricing Director for
the Asia Pacific region at Novartis Pharma AG, Basel,
Switzerland. His professional experience encompasses
health economics activities across a range of therapies.
His recent areas of research are use of Health Economics
for Pricing and Reimbursement Decision Making and
Outcomes Based Innovative Pricing Schemes. Welcome
Abdulkadir.
Abdulkadir Keskinaslin (AK): It’s a pleasure to be here Jon.

7
So, let me see if I can set the context for our discussion. We
could safely say that there are three global trends impacting
healthcare worldwide. The first is the desire to improve access
to healthcare for large populations.
Second, this is accompanied by a rise in healthcare expenditure
and the potential to politicize the healthcare process.
And third, these are all set against the backdrop of a global
economic downturn, which has the industry and buyers looking
hard at how they are spending their money.
So, with that as the context, let’s turn to our panellists to learn
from their insights into how this is playing out across Asia.

8
Mandy, let’s start with you. What are the opportunities
and challenges in the Asia Pacific markets today?
MC: Well, Jon there are a number of opportunities we can
identify, such as an emerging middle class, particularly in
China and India. For example, the middle class (those with
annual disposable income of US5 to 15K) has been rapidly
growing from 16 mil to 124 mil households in the last 10
years, changing demographics brought on by an ageing
populations, and the movement of treatment away from
infectious disease to a rise in chronic disease such as we see
in the developed markets today. All these mean more people
are demanding more drugs and are able and willing to pay for
it.

9
Yes, these are positive trends for the pharma market in
APAC. So what are the challenges?
MC: Well, the biggest challenge is that most of the APAC
countries do not have sufficient government funding for
healthcare and they are non-reimbursed markets. Drugs are
still largely paid out of pocket by the individual. At the bottom
of the pile is India, typically with 80% of the health care
expenditure paid by the individual. This is followed by China
and the Philippines, with more than 50% of drug expenditure
paid by the individual.

10
I guess in these emerging markets, poor infrastructure
continues to be a problem as well?
MC: Yes that’s right Jon. In many of these markets they do
not even have enough doctors and hospitals and clinics to
diagnose and treat the patients. For example, there is only
one doctor per 10,000 population in Indonesia vs. 34 doctors
for the same population in Germany. Even clean water or
transportation is often not available to reach many of the
patients in the rural and very remote areas. So, patients
simply don’t have access to medical care facilities and remain
under-diagnosed and under-treated.

11
But healthcare reforms are ongoing in these emerging
markets?
MC: Yes that’s true. Healthcare systems are being built and
reformed across the region. Most countries are all growing
their GDP at 5% or more but healthcare spending is not
keeping pace. Thus, the government is under tremendous
pressure to improve healthcare for its citizens, especially in
providing basic healthcare or medicine to the general public.

12
Can you give us some examples, Mandy?
MC: Yes of course. One example is China, where they have
put together a very ambitious health care reform plan. The
Chinese government is investing 125 billion US dollars in the
next three years to broaden the access of medicine and also
health care services to its population. The government has
introduced 3 medical insurance schemes to cover 90% of its
population by 2011. However in the Philippines, funding is
still a major concern and they have implemented a number of
significant price cuts towards a lot of the top selling drugs.

13
And with these new burdens on the healthcare budget, is
there a concern about increased costs?
MC: Yes, and this can be seen in government initiatives to cut
prices, adopt international reference pricing, increased co-
payment from patients, and practised generic substitution.
The adoption of Health Technology Assessment, or HTA,
however, is still at its infancy in this region.

14
What countries are we talking about here, as an
example?
MC: Well, Korea and Taiwan are more advanced in terms of
adopting HTA to balance and optimize health care resources
and allow for innovation for the drug industry.
Thailand is the next country fast catching up. However,
countries like China or the Philippines, are still learning about
this system and have not yet put things into practice.
AC: Jon, let me build on Mandy’s point. Conceptually, HTA
definitely has been adopted as one of the ways to look at
cost-effectiveness, and other measures of product value. The
balance between providing better treatment options and
adapting new technologies is the struggle for many of the
governments in Asia.

15
So there is a general push to adopt HTA in these
emerging markets?
MC: There is, but the main challenge here is the lack of
expertise and talent to help the health authorities to move
this forward. There is also a shortage in terms of data; for
HTA to work, you need a lot of local data: clinical data and
healthcare resources data in order to assess cost
effectiveness of various treatment options and healthcare
resources usage.

16
I see. Well Asia could certainly learn from experiences in
Europe, where they have taken a long time to move from short-
term cost-containment measures to now being more focused
on looking and creating value in the system, in balancing the
health care resources. Is that right Annie?
AC: Absolutely. I can give examples of how European
governments -- with a long history of universal coverage and
raising costs -- have tried to tackle cost containment
measures, but with some concerns in the back of their minds
about industrial policy, because pharma industry has been
regarded in Europe as one of the high-tech strategic
industries that also needed to be strongly supported. So,
cost-containment measures have been developed side-by-
side with industrial policies, with the specific balance between
the two playing out in each country.

17
MC: It’s interesting to see the different tools that have been
used in cost containment.
AC: Yes, for example, the experience of price control in
France, profit control in the UK, prescribing budgets in
Germany and therapeutic national reference price in
Germany. Each was able to integrate HTA progressively into
the cost-containment measures to improve the efficiencies of
the health expenditure regulations and to avoid the “side
effects” of too basic cost containment measures.

18
Can you give us some examples of these “side effects”?
AC: Sure. For example, in France, prices for the
reimbursable drugs have been fixed by the government since
1948, but the implementation of the control for the first 35
years or so was inefficient, and not rewarding enough true
innovation. Efficiency started to be imported into the system
only in 1980, but it took time to design in collaboration with
the pharmaceutical industry some sort of predictable model
with clear rules and meanwhile other measures had to be put
in place to improve the rationality of prescriptions, for
instance by authorizing generic prescriptions by physicians
and substitution by pharmacists.

19
MC: So, French patients now have access to very innovative
drugs with a relatively short delay at international prices,
because now innovation is a key criteria for drug approval.
AC: That’s right Mandy. As another example, we can look at
the UK, which adopted PPRS, the Pharmaceutical Price
Regulation Scheme. Its objective was primarily to control
prices by controlling profits made on the sales through the
National Health Service, but also to favour a thriving pharma
industry. The result is that the British pharma industry has
been very productive in discovering and marketing -- at a
global level -- new drugs whereas its market value has been
kept at a much lower share of the global market.

20
MC: But, I understand that PPRS did not meet the need for
the best use of the limited resources allocated to the National
Health Service, so this was a problem.
AC: Yes. This is the reason why the National Institute for
Health and Clinical Excellence, or NICE, was set up in 1999
with the mission -- based on HTA methods -- to issue
recommendations to the NHS decision makers so that British
citizens would spend their health care budget in a more
optimized way. The new PPRS signed in 2009 adopts value-
based pricing to an extent.

21
Annie, would you say that a PPRS would be relevant in
Asia-Pac countries?
AC: There may be a connection between the regulation of
pharma expenditures that are imposed by governments and
the attractiveness of the country in terms of pharma
investments, whether it is research and development
investments or production investments. But the example of
the UK is to be really looked at very carefully. If HTA is not
carefully introduced, it may provoke aggressive pricing and it
may restrict access to care, which was actually a real issue in
the UK in the 90s before NICE was introduced.

22
So could we use any other country as a better example?
AC: We could look at Germany. The German government has
also been very keen on fostering a strong pharma industry
and free pricing with hardly any selection for reimbursement
has been the case for decades. But the reunification of
Germany and later on economic crisis made it necessary to
adopt cost-containment measures.

23
Such as?
AC: The first innovation was to fix limited budgets imposed
on prescriptions to physicians. This policy has been
implemented over many years and has had some painful side
effects, such as inviting office-based physicians in outpatient
care to refer patients to hospitals -- which is of course much
more expensive -- to avoid the costs for prescriptions which
otherwise would exceed their fixed budget.

24
What did they learn from this?
AC: The lesson learned is that you have to negotiate with
physicians and encourage good clinical practices before
limiting budgets in order to maintain quality care. Defining
good clinical or medical practise relies largely on HTA.

25
And Germany adopted therapy-based pricing. What has
been the impact of this cost-containment measure?
AC: Well, it can be viewed as successful in that it has been
adapted across Europe. In this model, prices for reimbursed
drugs remain free, but products are clustered together
because they have the same key ingredient or because they
have essentially the same therapeutic effect. Then, for all
drugs in this area, a unique tariff is set for reimbursement.

26
What happens if the company does not align the price to
the reimbursed tariff?
AC: If the company does not align the price to the
reimbursement tariff, it means that the patient has to pay for
the difference. And if there are alternatives, doctors would be
encouraged to prescribe the alternatives. This leads to all
prices in that therapeutic class aligning on the tariff. As a
result, this has been a very rapid and effective tool for price
decreases.

27
It sounds quite effective, but what are the “side
effects?”
AC: Well, firstly, not all drugs can be easily be clustered from
a clinical perspective, and it is a viable share of the
expenditure that can be covered, depending on the entry of
new drugs. Drawbacks are that companies tend to charge
more for “non-clustered” products to compensate the price
decreases on the referenced products.

28
Thank you for listening to part 1!
Be sure to listen to part 2, also available on SlideShare!
• To download an MP3 of this interview, click here.
• To download the PDF transcript, click here.
• Questions? Comments?
− Fill out the form at the bottom of this slide, or
− Visit www.imshealth.com or email info.sg@sg.imshealth.com.

Opportunities and Challenges for HTA in Asia-Pacific (Part 1)

Empfohlen

Empfohlen

Weitere ähnliche Inhalte

Andere mochten auch

Andere mochten auch (6)

Ähnlich wie Opportunities and Challenges for HTA in Asia-Pacific (Part 1)

Ähnlich wie Opportunities and Challenges for HTA in Asia-Pacific (Part 1) (20)

Mehr von QuintilesIMS Asia Pacific

Mehr von QuintilesIMS Asia Pacific (20)

Kürzlich hochgeladen

Kürzlich hochgeladen (20)

Opportunities and Challenges for HTA in Asia-Pacific (Part 1)