Further follow-up data can strengthen confidence in Value-Based Pricing
This article was translated from Swedish. See the original here.
More dynamic pricing of a drug can lead to repetitive re-evaluation of a drug's value during its life cycle, due to new follow-up data collection.
“It can mean both lower and higher prices, but we are in the early stages of this development so far and would need to cooperate with other stakeholders to invent better systems for data monitoring and evidence generation,”- commented Niklas Hedberg, Chief Pharmacist at the Dental and Pharmaceutical Benefits Agency, TLV, at the Nordic Market Access Leaders Forum held on April 19-20th in Stockholm, Sweden.
The TLV's Chief Pharmacist suggested that a more dynamic pricing of medicines requires a regular re-evaluation of drug's economic value. Price reductions and increases may be a consequence of better knowledge about the drug benefit in clinical practice, which is now an increasingly important component of the drug price and reimbursement system in Sweden that is based on value-based pricing (VBP).
According to Niklas Hedberg, such a development would be a sign of strength that the system of value-based pricing is both flexible and dynamic:
“I think the decisions on price changes based on real-life evidence, that was obtained in everyday clinical practice, would prove the fact that the Swedish VBP system has the ability to both reduce the risk of non cost-effective use and stimulate cost-effective use”.
TLV make numerous decisions on price changes every year, but the developed and dynamic value-based pricing is yet at an early stage. In the TLV expert’s opinion, the model would prove to be reliable if TLV made more price change decisions based on new efficacy data.
Niklas Hedberg then went on to reflect on why TLV do not practice this system more often:
“A prerequisite to further strengthen the dynamism and flexibility of the value-based pricing is that the opportunities for monitoring of improvement of a medicine’s value. This initiative will also require development of IT systems within the Swedish Council of Health Technology Assessment and Swedish Government.”
The article was prepared based on participation at the Nordic Market Access Leaders Forum organized by NextLevel Pharma - the meeting was attended by Swedish, Nordic and international experts in the pharmaceutical industry, both from the public sector and the business community.
Editor, Pharmaceutical Market Newsletter