Efficiency Frontier Method: Reducing Psoriasis Drug Prices Based on Clinical Benefits

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These findings suggest much lower prices can be achieved for medications, with better alignment to the benefits of different biological psoriasis treatments.

Alexander C. Egilman, BA

Credit: PORTAL

Alexander C. Egilman, BA

Credit: PORTAL

The use of an efficiency frontier (EF) approach for plaque psoriasis biologics is helpful to reduce prices during negotiations to more adequately align prices with the drugs’ clinical benefits, according to new findings.1

The method known as EF is designed to map therapeutic option costs to outcome measures in a manner which is specific to diseases. This new research on EF was led by Alexander C. Egilman, BA, from the Division of Pharmacoepidemiology and Pharmacoeconomics Program On Regulation, Therapeutics, And Law (PORTAL) at Brigham and Women’s Hospital in Boston.

Egilman and colleagues emphasized the fact that following the negotiation on prices which occurs following these assessments, less than half of the prices paid in the US for drugs are typically paid by countries outside of the US.2

“We sought to investigate how EFs can be used by state and federal policymakers to achieve drug prices based on comparative clinical benefits, using the example of plaque psoriasis,” Egilman and colleagues wrote. “For comparison, we also used the EF approach to examine the association between clinical benefits and prices for psoriasis drugs in the US compared with several countries that already use HTA, including Australia, Canada, France, and Germany.”

Background and Methods

The investigators looked specifically at the prevalent skin disease plaque psoriasis, known for its substantial health and economic impacts in the US due to the cost of treatments. There have been several biologic drugs approved for the treatment of moderate-to-severe plaque psoriasis since 2003, and these are more efficacious than older therapies.

Despite this fact, such biologics are also expensive. The investigators noted that they have a substantial median annual cost which had been shown to exceed $35,000 in the year 2019.

The research team determined that they would assess 11 US Food and Drug Administration (FDA)-approved biologics as well as their biosimilars treatment of psoriasis, gathering the necessary drug data from publicly available sources. They looked at the route of drug administration, mechanisms of action, date of FDA approval, and indications for the drug.

The team used a 2020 network meta-analysis of 60 total studies to assess clinical benefits, with the Psoriasis Area and Severity Index (PASI)-90 rating implemented as a primary outcome measure for the EF method. The treatments’ safety data were noted by the investigators as comparable based on low serious adverse event rates and discontinuation rates.

The research team looked at information related to cost in several different countries before converting the costs to US dollars and then adjusting for notable discounts. Net prices were estimated by the team using rebates, and the prices found in other countries were based on ex-factory prices resulting from discount information which was limited.

Findings

Overall, the investigators found that among the 13 biologics they had evaluated, rates of PASI 90 responses were shown to have a range from 17.9% - 71.6%. In the US, treatment costs varied from $1664 to $79,277 annually.

The research team noted that $34,965 was the median annual cost in the US. They added that this was found to be higher than that of Canada, Australia, France, and Germany.

Biologics which the team assessed the prices of in the US included ixekizumab ($33,004), infliximab-dyyb ($1664), and risankizumab ($79,277). Prices of treatments in the US would, the investigators added, need to lower substantially to align with the estimates of EFs.

“This approach may appeal to policymakers as an alternative to traditional (cost-effectiveness analyses) that rely on politically charged (quality-adjusted life-years), but its use is limited to situations in which there are multiple therapeutic alternatives for which differences can be adequately summarized by a single outcome measurement,” they wrote.

References

  1. Egilman AC, Kesselheim AS, Avorn J, Raymakers AJN, Rome BN. Use of Efficiency Frontiers to Align Prices and Clinical Benefits of Biologic Therapies for Plaque Psoriasis. JAMA Dermatol. Published online February 21, 2024. doi:10.1001/jamadermatol.2023.6236.
  2. Mulcahy AW, Whaley CM, Gizaw M, Schwam D, Edenfield N, Becerra-Ornelas AU. International prescription drug price comparisons: current empirical estimates and comparisons with previous studies. RAND Corporation. 2021. Accessed September 18, 2023. https://www.rand.org/pubs/research_reports/RR2956.html.
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