This presentation discusses pharmacoeconomic assessment through different phases of drug development and approval. It provides an overview of different types of pharmacoeconomic analyses including cost-minimization analysis, cost-effectiveness analysis, cost-utility analysis, and budget impact modeling. It emphasizes the importance of real-world pharmacoeconomic assessment to demonstrate the true cost-effectiveness and safety of drugs based on real-world data rather than clinical trials alone. The presentation outlines considerations for planning and implementing real-world pharmacoeconomic assessments, including study design, data collection from multiple sources like electronic health records, and ongoing analysis of updated data streams.

1. Pharmacoeconomic
Assessment through
Market Approval
and Beyond:
Theory and Operations
Presented by:
Matthew J. Page, PhD, MPP
Epidemiologist

2. Agenda for Today’s Presentation
2 Physician Led | Therapeutically Focused
o Eat Lunch
o Try to Stay Awake!!!
o Overview of Pharmacoeconomic (PE) Assessment
o Planning PE Assessment
o Real World PE (RWPE) Assessment
o Implementing RWPE Assessment
o Working with Data
o Closing Considerations
o Questions

3. Overview of
PE Assessment

4. Types of PE Assessment to be Discussed
4 Physician Led | Therapeutically Focused
o Cost-minimization analysis
o Cost-effectiveness analysis
o Cost-utility analysis
o Budget impact modeling

5. Cost-Minimization Analysis (CMA)
5 Physician Led | Therapeutically Focused
o Compare costs of two or more drugs or therapies
to determine least costly option
 Baseline costs include acquisition costs as well as
costs of preparation and administration
 Additional costs depend on perspective of analysis
o Main benefit: cheaper and easier than cost-
effectiveness analysis
o Main drawback: assumption that two drugs or
therapies are used at equivalently effective doses

6. Cost-Effectiveness Analysis (CEA)
6 Physician Led | Therapeutically Focused
o Considers both costs and effectiveness of two or
more drugs or therapies
 Costs measured in monetary unit of interest (Eg, $)
 Effectiveness generally measured using one or more
clinical outcome (Eg, years of life saved)
o Main outcome is incremental cost-effectiveness
ratio (ICER): (∆ Costs / ∆ Effectiveness)
 Eg, incremental cost per life year saved
o ICER compared against willingness-to-pay (WTP)
thresholds to determine if cost-effective, cost-
saving, or cost-neutral

7. Cost-Effectiveness Plane
7 Physician Led | Therapeutically Focused
∆Costs
∆ Effectiveness
Maximum
Acceptable
ICER
Accept
Reject

8. Cost-Utility Analysis (CUA)
8 Physician Led | Therapeutically Focused
o CEA accounting for quality of time gained or lost
o Quality of life (QOL) measured using utility
 Generally ranges from 0 (dead) to 1 (perfect QOL)
o Most common ICER assessed in CUA is cost per
quality-adjusted life year (QALY) gained

9. Budget Impact Modeling (BIM)
9 Physician Led | Therapeutically Focused
o Generally designed for specific audiences,
particularly third party payers
o Measures net cumulative treatment cost with drug
or therapy of interest for specified number of
patients in particular population
o Impact of particular drug or therapy is assessed
as effect on cost per member per month (PMPM)

10. Perspective of PE Assessment
10 Physician Led | Therapeutically Focused
o Who pays for treatment and who benefits?
o Potential perspectives include:
 Healthcare provider
 Third party payer
 Society
o Different perspectives mean different considerations

11. Planning PE
Assessment

12. Drug Development Cycle
12 Physician Led | Therapeutically Focused

13. PE Assessment at Different Phases
13 Physician Led | Therapeutically Focused
o Phase II
o Earlier phase III
o Phase III piggyback studies
o Peri-authorization
o Post-authorization
o Contemporaneous with later Phase III is common
but can consider earlier Phase III or Phase II
o Collection of RWPE data?

14. Planning PE Assessment
14 Physician Led | Therapeutically Focused
o Plan must consider:
 Disease area
• Acute vs. chronic vs. oncology?
• Recurrence timeframe?
 All relevant phases
 Sponsor budget
• CEA for publication vs. BIM for use with payers?

15. RWPE
Assessment

16. Why RWPE?
16 Physician Led | Therapeutically Focused
o Differentiation in costly yet lucrative landscape
 $2.6 billion to bring new drug to market (Tufts CCSD)
o Development cycle does not end with approval
 Real world research, including RWPE, can drive new
earlier phase research, in turn driving new real world
research
 Sustain value across product lifecycle
o Collect extensive effectiveness and safety data
 More relevant than literature-based models
 More robust than earlier phase clinical data
o True cost-effectiveness rather than cost-efficacy

17. Are Payers the True Decision Makers?
17 Physician Led | Therapeutically Focused
o Roles of FDA and payers, including Medicare and
Medicaid, are constantly evolving
 Correcting Signals for Innovation in Healthcare
 Medicaid expansion under Affordable Care Act
o Drug approval becoming “easier” (Forbes)?
 2008: 50% of NMEs approved by FDA
 2014: 88% of NMEs approved
o US District Court ruling re: Amarin’s Vascepa®
o Increased emphasis on generation and
dissemination of evidence aimed at payers
 Real World Evidence/Outcomes liaisons

18. 18 Physician Led | Therapeutically Focused
o Three recommendations:
1. Replace tax exclusion for employer-provided health
insurance with tax credit
2. Strengthen Medicare coverage determination
process
3. Experiment with reference pricing for certain
therapies in Medicare
o RWPE can inform last two recommendations

19. Epidemiologic Study Designs
(by Traditional Strength of Evidence)
19 Physician Led | Therapeutically Focused
1. Randomized controlled trial
2. Community trial
3. Prospective cohort study
4. Retrospective cohort study
5. Case-control study
6. Cross-sectional study
7. Ecologic study
8. Case report or case series
Observational
Interventional
Descriptive
Analytic
Strength of evidence: ability to establish causal link

20. Real World/Observational Epidemiology
20 Physician Led | Therapeutically Focused
o Data gathered in naturalistic (real world) setting
o Variables of interest include:
 Exposure
• Harmful (Eg, behavior) or protective (Eg, drug, vaccine)
 Outcome
• Disease or health state
• Time to event
 Potential confounders
o If treatment involved, prescribed in usual manner
 Therapy assignment not decided in advance by protocol
 No diagnostic or monitoring procedures other than those
ordinarily applied

21. RWPE Builds on Observational Epidemiology
o Registries are cohort studies
Specifically prospective and retrospective cohort studies
21 Physician Led | Therapeutically Focused

22. Different Results Based on Different Data
22 Physician Led | Therapeutically Focused

23. Implementing
RWPE
Assessment

24. RWPE Means Dynamic
Data Collection and Analysis
24 Physician Led | Therapeutically Focused
o Specifically, continually updated data streams
allow for refinement of CEA and BIMs to reflect
most up-to-date data, providing consistently
refreshed ICER and PMPM cost estimates
o How is this implemented?
 Dedicated processes

25. Dedicated Processes for RWPE
o Protocol must describe study challenges and
methods for resolution, while addressing (Giezen
et al. 2009, Kiri 2012):
 Ecological validity
 Achievable study objectives
 Tailored operational processes
Study Design and Protocol
25 Physician Led | Therapeutically Focused

26. Dedicated Processes for RWPE
o Ensure straightforward navigation for electronic
case report forms (eCRFs)
o Provide guidance for online queries
o Design database to be flexible and easy to use
o Include all stakeholders in design as well as any
changes
 Sites
 Analysts
 Submissions team (if relevant)
eCRF Design and Development
26 Physician Led | Therapeutically Focused

27. Dedicated Processes for RWPE
o Obtain permissions and licenses
o Validate per FDA guidance
o Address HIPAA and security concerns
o Plan for incorporating PRO data into PE
assessment
 Ie, primary EQ-5D scores are preferred source of
utility data for NICE
Patient Reported Outcomes (PROs)
27 Physician Led | Therapeutically Focused

28. Dedicated Processes for RWPE
o Incorporate alerts into analysis dataset programs
o Use templates designed for repeated delivery
o Design output programs with locked, validated
modules as well as modules that are intended to
evolve and change
o Structure eCRF rules to promote easy updates
o Normalize dataset design and use of metadata to
support multiple data cuts
Programming and Data Governance
28 Physician Led | Therapeutically Focused

29. Working with
Data

30. Merging Data from Multiple Sources
o RWPE involves coordination with healthcare
providers and payers to collect regularly
refreshed, relevant data such as electronic health
records (EHR), PROs, and costs/reimbursements
o Timing and costs of implementation are concerns
o Therefore, data collection must be as efficient as
possible
 Efficiency derives from well-designed and well-
integrated electronic data capture (EDC) system
The Crux of the Matter for RWPE
30 Physician Led | Therapeutically Focused

31. Cost/Reimbursement Data Sources
31 Physician Led | Therapeutically Focused
o Patient records at doctor’s office
 CMS 1450 (UB04 Uniform Bill)
o Claims databases
 Medicare and private
o Coding
 CPT, other codes
o RED BOOK
o Published literature
o Government reports

32. o Real world effectiveness study
 Prospective cohort
 Retrospective cohort
o Claims data
 Standalone
 Link with study data
Data Sources: Effectiveness and Claims
32 Physician Led | Therapeutically Focused
=
Payer
Study
Payer Study

33. Merging Data from Multiple Sources
CDISC Healthcare Link Initiative
33 Physician Led | Therapeutically Focused

34. Merging Data from Multiple Sources
FDA EHR Demonstration Project
34 Physician Led | Therapeutically Focused

35. Merging Data from Multiple Sources
National Claims Database?
35 Physician Led | Therapeutically Focused

36. Merging Data from Multiple Sources
o Standardize any coding as well as definitions of events
and outcomes (Abbing et al. 2010, Blake et al. 2012,
Andrews et al. 2012)
o Foster harmonization across multiple sources by using
common data model (Coloma et al. 2011)
 Standardized input files can be created from each
database, linked via patient ID, and managed locally
o Develop storage system making individual databases
accessible from common platform as anonymized data
at appropriate level
 Based on common data model in compliance with
guidelines relevant for each database (Trifirò et al. 2014)
 Process should involve stakeholders for each database
Some Thoughts
36 Physician Led | Therapeutically Focused

37. Target Data for Hybrid EHR Sourcing
37 Physician Led | Therapeutically Focused
Problem data for
EHR systems
Stop dates
Scaled data
Surveys/PROs
Costs
Better data for
EHR systems
Coded for payments
Already transactional
(lab systems,
pharmacy)
Most problematic
data for sites
High volume
Complex
Query-prone
Research vs.
Healthcare
Labs
Meds

38. Closing
Considerations

39. Recruitment and Retention
39 Physician Led | Therapeutically Focused
o Well-integrated EDC, EHR, and ePRO will
enhance retention of sites and patients
o Recruitment populations for RWPE studies differ
from populations for interventional trials
o RWPE studies tend to be longer
 Direct impact on site motivation
o Gauging and developing site experience and
motivation are essential in optimizing enrollment
 Establishing study expectations from outset
 Capacity for integration with EDC?
 Training?

40. Too Much of a Good Thing?
40 Physician Led | Therapeutically Focused

41. In Other Words…
41 Physician Led | Therapeutically Focused
o … is RWPE worth the hassle?
o Blommenstein et al. conclude…
o In short, YES, if done properly and efficiently

42. Future Considerations
42 Physician Led | Therapeutically Focused
o Product development cycle does not end with
approval
o PE assessment in earlier and later phases,
including RWPE, is essential to demonstrating
product value
o Real world research, including RWPE, can drive
innovation
o RWPE demonstrates market leadership
o Flexibility is essential

43. Thank You
Matthew J. Page, PhD, MPP
Epidemiologist
m.page@Medpace.com

44. Questions?