Formulary guidance and transparency from P&T to point of care

Radar On Market Access: In Value-Based Deals, Idea of Value Differs Among Firms

Posted by Matt Breese on Jun 7, 2018

Find me on:


As pharma manufacturers strive to demonstrate to payers their products' efficacy in the face of backlash against rising drug prices, one effective tactic may be to enter into value-based contracts. It's crucial for manufacturers to understand how other entities they wish to partner with approach value and to start preparing that value proposition early in the drug development process, AIS Health reported.
Different payers will come at value from different perspectives. "A standalone Medicare Part D plan has very different priorities than an integrated health system," says Larry Blandford, Pharm.D., an executive vice president at Precision for Value.
Value mapping can help manufacturers answer "what are the value definitions and requirements of payers," according to Joe Coppola, a managing director at Deloitte Consulting LLP's life sciences practice. He adds that manufacturers also can "listen through technology" such as social media to "hear what people are saying."
In addition, manufacturers should begin thinking about value endpoints as early as Phase II, multiple sources tell AIS Health. "As the development process proceeds, so should the evolution of thinking about the contract. A late Phase II or early Phase III assessment of what potential contracts might look like for a given product is ideal, as the competitive environment will likely have shifted, and/or new data become available since thinking about the contract began," says Kathy Hughes, a vice president in Avalere Health's market access practice.
Manufacturers should also consider engaging with an evidence-assessment organization such as the Institute for Clinical and Economic Review, as it has increasingly more influence on the definition of value. 

Subscribe to the MMIT blog for more pharma, provider, and payer perspectives on key topics that affect the healthcare network.

Subscribe for Weekly Perspectives

Topics: Industry Trends, Market Access, Provider, Payer