To the Cloud Part 1

After another successful ISPOR International meeting we look back at the trends associated with the European and International poster presentations. We also explore the trends in workshops and issue panels.

Comparing the poster presentation word clouds of the European and International meetings, there seemed to be more posters in Montreal centered on diabetes, risk, cancer, and patterns. There was also a significant increase in diabetes studies for the International meeting (9.48%) in comparison with the European meeting (7.33%).

Regulation of healthcare studies saw a significant increase in the International meeting and accounted for 1.60% of all studies compared with only 0.42% in the European meeting.

The workshops and issue panels saw trends around the key words of personalized medicine, risk-sharing and electronic medical records.

Assessing the trends in ISPOR Europe and ISPOR International

Every ISPOR event has a different theme. The 2013 European meeting’s theme was “The Patients and Health Technology Assessment,” and the 2014 International meeting’s was “Big Data.” The real themes of the events, however, were determined by the poster presentations, issue panels and workshops. These items were submitted by people working in the field and showed the actual trends within pharmacoeconomics and outcomes research.

We dissected the titles of all the posters, issue panels and workshops at the 2014 ISPOR International Meeting in Montreal. The image below is a word cloud comprised of all 1,562 poster titles.

All Posters

Image 1

Compared with the word cloud of poster titles from the European meeting in Dublin, there were a lot of the same words such as patients, cost-effectiveness, treatment, analysis, and health. The words that seem to stand out more from the International meeting are diabetes, risk, cancer, and patterns.

In addition to the type of study, we also tracked the disease areas covered by the posters. The sectors and types of study distributions were compared with the European meeting. The sector of the study refers to the disease area or if there is no specific disease area it refers to the focus of the study (research on methods or health care use and policy studies).

Sector Distribution

Image 2

Compared with the European meeting, the International meeting had a more even distribution of sectors. In the European meeting the highest concentration of posters were research on methods posters (14.18%). For the International meeting the highest concentration of posters was in cancer (11.84%).

There was also a significant increase in diabetes studies for the International meeting (9.48%) in comparison with the European meeting (7.33%).

Check out our next blog post to see our look at the types of studies, which included cost studies, PRO studies, clinical outcomes studies, etc.

Emerging Global Pharmaceutical Trends for 2014-2020

The landscape for pharmaceutical research and development is shrinking, resulting in reduced revenue possibilities and tougher competition. New regulatory and pricing trends emerging this decade bring a paradigm shift that the industry must respond to and embrace to ensure success. The future will bring increased responsibilities to pharmaceutical manufacturers, but will also open the door for new opportunities.

Picture 1

Smaller Launches

As broad-spectrum pharmaceuticals become increasingly available, the industry begins shifting towards a more specialized focus. Orphan drugs are becoming the focus of development efforts as the specialized area harbors the most opportunity. New patents are being awarded primarily to prescription pharmaceuticals that can address previously untreated – or under-treated – diseases. As a result, the quickest way to an exclusive marketable drug is filling these niche markets.

In 2013 the number of FDA-approved new molecular entities (NMEs) met an industry average of 27, although this number dropped from the 39 approved in 2012. Most of the NMEs approved last year are targeted toward rare diseases or highly-specific medical conditions, proving that Orphan Drugs are becoming the focus for future growth. With such a niche target, large blockbuster releases are entirely impractical. Instead, pharmaceutical manufacturers have favored smaller, more strategically precise launches and as the trend continues into 2014, smaller but more frequent product launches are likely to continue.

Value-Based Pricing

This year we will see the regulations for pharmaceutical pricing reach full effect in the UK. The primary factor behind pricing pressure is a push toward value pricing, a pricing model based upon what customers are willing to pay and the perceived benefits one drug may have over another. The shift toward buyer-focused modeling brings increased pressure for pharmaceutical companies to bring lower-priced or higher-impact drugs to the market. While the regulation is currently localized to the UK, it is likely other European countries will follow suit. With proof of customer benefits, the trend is likely to spread throughout global markets, shifting the burden of affordable healthcare to pharmaceutical manufacturers rather than healthcare providers or insurance companies.

Video: https://www.youtube.com/watch?v=ToHRIy991mo

Increased global communication will effect pricing models even further. As international transparency increases, customers gain better ability to compare drug prices across various markets for themselves. Greater technological assessments of new drugs will move the power into the buyer’s hands, putting increased pressure on drug manufacturers to lean toward a buyer-friendly market. A pricing paradigm shift throughout 2014 may be seen that could continue to control pharmaceutical pricing through the remainder of the decade.

Increased Collaboration

2013 represented a rather calm year for pharmaceutical acquisitions and mergers. The relaxed atmosphere is expected to dissipate in the coming years as trends shift towards more aggressive marketing. As previously stated, the pharmaceutical industry is moving toward more specialized medicines, and the race to be the first to bring a targeted drug to the market will cause an increase in company acquisitions. Smaller manufacturers can expect to face increased pressure for mergers or collaborative efforts from bigger companies in the interest of protecting margins for emerging prescription drugs.

In situations where acquisitions are impractical, collaboration efforts from major pharmaceutical companies in producing new research and launching new drugs may be the only option for ensuring a return on investment. However, by its very nature, collaboration means smaller margins for each party involved, splitting profits between each functioning entity and while it could mean smaller profits per drug, the speed and technology of collaborative efforts could increase a company’s overall production. The shifting terrain only better serves the anticipation of smaller, more frequent product launches.

Social Media and Digital Marketing

In the past, the pharmaceutical industry by nature had a resistance to social media and digital marketing techniques. With built-in safety concerns, social media marketing brought a higher risk for the company and the potential for a large-scale fallout from aggressive marketing or what may be perceived as negligence. Opening a drug to social platforms carried a responsibility to customer experiences that extended beyond standard health-effect research. The topic shifted into an open forum where individuals can express concerns or negative experiences directly to the marketing branch as well as other customers.

Infographic: http://visual.ly/what-your-primary-goal-social-media-marketing

However, the time has come to embrace social marketing. Cultural trends are leading societies around the globe toward internet-based shopping and product research. As society becomes more closely integrated, social media emerges as the cornerstone for successful marketing campaigns. Admittedly, the concept is not entirely new for pharmaceutical companies, and many manufacturers have been testing the social media waters over the last few years. But as we move into the latter half of the decade, pharmaceutical companies may have to abandon their reluctance and dive head-first into social media marketing, as it will increase their marketing range and establish them as a more socially relevant entity.

The Health Cup Part 2

Health Expenditures

While health expenditures do not always mean better outcomes, in theory the more a country spends on health the healthier its people should be and better athletes should be produced. We decided to see if higher health expenditures as a percentage of GDP are correlated with a better world ranking.

Health Expenditures

Health expenditures as a percentage of GDP show a slight correlation with overall FIFA world rank. An obvious outlier is the United States, which spent nearly 18% of its GDP on health in 2012 for only a 14 world ranking. Without the outlier, there is a noticeable positive correlation in world rankings and health expenditures as a percentage of GDP.

We also looked at health expenditure per capita versus world rankings in the following graph.

Health Expenditures 2

Health expenditures per capita show little correlation and a less pronounced relationship than health expenditures as a percentage of GDP. Again, the US is a noticeable outlier, and so is Switzerland. These two countries spend the most per capita on health and are rewarded with 14 and 8 rankings. On the other end of the spectrum, Australia spends the third most and is ranked a world cup worst 59th.

Overall we expect an exciting World Cup as usual. Below you’ll find some of the Alliance team’s predictions for the winner!

 

The Health Cup Part 1

We are finally within sight of one of the greatest sporting events in the world: The World Cup. The chatter has already started as the final squads are announced. How will the United States cope without the veteran leadership of Landon Donovan? Will Suarez be healthy in time to lead Uruguay out of a tough group?

In this issue, we took a look at the field of teams in the World Cup and also analyzed some health economic indicators to see if there were any correlations with FIFA world rankings.

We uncovered some correlations with life expectancy and health expenditures. Lastly, in an unscientific manner, we offer our picks as to who will win the World Cup.

Setting the Stage

One of humanity’s greatest sporting events will run from June 12th through July 13th as 32 nations will compete to win the World Cup in Brazil. It has been a long road of qualifying for many of the 32 teams. There have been some exciting matches such as the November “winner take all” qualifier between Sweden and Portugal where Portugal crushed the hopes of Ibrahimovic and his squad.

The United States, who ran the CONCACAF table, had a very exciting qualification stage as well. After a 2-1 loss in the first game, the US went on to win the group decisively with an impressive 0-0 draw against Mexico in Azteca in front of 85,000 fans. One of the most criticized games of the entire qualifying stage came from the United States’ 1-0 win against Costa Rica. The game saw several inches of snow, which completely covered the pitch. Crews had to shovel the lines for the penalty, sidelines and goal lines tirelessly throughout the game. The game was stopped in the 70th minute and the Costa Rica squad insisted it be continued, only to later protest the game after the final score was sent in.

The group of 32 teams that did qualify feature some incredible talents such as Messi (Argentina), Ronaldo (Portugal), Neymar (Brazil) and Suarez (Uraguay) to name a few. These players have the potential to go down as some of the best all time, so to have them all playing in the same World Cup is very special.The game was stopped in the 70 minute and the Costa Rica squad insisted it be continued, only to later protest the game after the final score was sent in.

Group play this year will prove to be especially interesting if one is a fan of the United States who drew into Group G, or what is being dubbed as this year’s “group of death”. The US will have to start against a tough Ghana team, which knocked them out of the 2010 World Cup in a heartbreaker. The schedule does not become any easier for the US squad who will have to play both Germany and Portugal, who rank numbers 2 and 3 in the world respectively.

Group D—with Uruguay, Costa Rica, Italy and England—will be another very tough group. One team out of Uruguay, Italy and England will not get out of group play, which will be unfortunate because they are all very good teams.

In Table 1, we give an overview of the eight groups and provide the team’s FIFA world rankings as of April 2014 and the number of top 4 finishes in previous World Cups.

table1

Group of Death

Every year there is a group that is drawn where all four of the teams could realistically make the knockout stage. Generally these teams all have high world rankings and are world powerhouses. This year’s group of death is said to be Group G with Group D not far behind. Group G has the number 2 and 3 teams in Germany and Portugal along with the US at 14 and Ghana at 38, though they play at a much higher level and can definitely play a spoiler role.

Group D is the second toughest group, and unlike Group G which has Germany and Portugal as two favorites to emerge from group play, Group D is wide open. This group is most likely going to be defined by one high impact player: Luis Suarez, an amazing talent for Uruguay. Suarez is currently recovering from knee surgery and is a may be to play in the World Cup. If he plays, the group could be a three horse race between Uruguay, England and Italy with Costa Rica playing the spoiler. If Suarez is absent, Italy and England will be the favorites to win the group.

We wanted to see if the label “Group of Death” is really appropriate for these tough groups. For the most part, the countries at the top of the rankings seem to be highly developed and modernized. We found the current life expectancy at birth for each of the teams and averaged it, along with FIFA world rank to find the average life expectancy and world rank for each group.

Group Rankings by Life Expectancy

The above graph suggests a correlation between the groups’ average FIFA world rankings and their average life expectancy at birth. Group G, which is being hailed as the Group of Death, is about middle of the pack for life expectancy (mostly due to Ghana). The real group of death seems to be group F which has the lowest life expectancy as well as the worst average FIFA world rankings. Group F’s low life expectancy is weighed down by Nigeria, which has the worst life expectancy in the tournament. Group B boasts the highest life expectancy and a middle of the road average ranking.

Since the last World Cup in 2010, many teams have jumped around in the world rankings. Keeping with the life expectancy theme, we examined how the average life expectancy changed from 2010 to 2012 compared with how teams’ rankings changed from 2010 to 2014.

Changes in Life Expectancy and World Rankings

We do not see any real trend in change in rank and change in life expectancy. An encouraging takeaway is that no country had life expectancy decrease over the period. Russia had the largest increase in life expectancy but also slightly fell in the world rankings. Belgium, which increased 50 spots in the rankings, had the smallest change in its already high life expectancy. Portugal which stayed at the three world ranking saw the second highest life expectancy increase which came in at 1.3 years.

In our next issue, we will look into  whether higher health expenditures as a percentage of GDP are correlated with a better world ranking.

The Uninsured: Part 1

A policy analysis of the Affordable Care Act

The Affordable Care Act (ACA) was passed in 2010 and aims to give more Americans access to affordable, quality health insurance, and to reduce the growth in health care spending in the U.S. To achieve this first goal, an individual mandate requires that most Americans get some kind of health insurance by 2014. March 31, 2014 marked the end of the open enrollment period if you want an insurance plan through the federal or state marketplaces. This was also the date to sign up by if you want to avoid the tax penalty if you do not have insurance or an exemption. The ACA estimated 32 million people would gain coverage, out of about 48 million who do not have insurance. Subsidies from the federal government will help pay for health insurance on state-based exchanges starting in 2014 and will allow many low- to moderate-income Americans to get a break on their premiums.

In the first part of our analysis we looked at who the uninsured are and what the demographics of these 48 million Americans look like. Then we explored how the ACA addresses the needs of these specific groups of uninsured people.

Table 1

Table 1 shows a breakdown of the population based on certain characteristics such as age, sex, race, and employment status and then gives the percent distribution based on insurance coverage. The age group that has the highest percent of uninsured are adults aged 18-65. Within this group there are 11 million young adults ages 18 to 29 that lack coverage.[1] More men are uninsured than women. The largest ethnic group that is uninsured are Hispanic and Latinos.

Within the adults that are uninsured, the group of young adults between 19-25 years of age have received the benefits of an additional benefit of the ACA. In one provision young adults can stay on their parent’s private health insurance coverage until the age of 26. This provision reduced the number of adults by an estimated 3 million people.[2]

Even though there is relatively high private coverage for employed individuals, the percent of uninsured employed people is only 0.2% less than the percent of unemployed and uninsured people. This could be due to employed individuals only working part time. Many companies do not offer health benefits to part-time employees. Under the ACA, large employers will have to offer benefits to full-time employees that work 30 or more hours a week. There are 7.6 million part time workers and 3.5 million self-employed workers that do not have health insurance. Depending on their income, Part-time workers and self-employed individuals can gain ACA coverage through Medicaid or Health Insurance Marketplaces.

In our next post, part 2 of The Uninsured, we will discuss a provision to the ACA that will increase the number of insured.

[1] Medical Expenditure Panel Survey: Health insurance coverage of the civilian noninstitutionalized population:Percent by type of coverage and selected population characteristics, United States, first half of 2012

[2] Kaiser Family Foundation. The Uninsured – Interactive Tool. Accessed April 2014: http://kff.org/interactive/the-uninsured-an-interactive-tool/

Bracket Buster: Part 2

In this post, we continue our analysis, and achieve better success after some adjustments to the methodology.

Our best indicator was tuition (in-state) which had 66% correct which beat out the analysts who performed the worst by 3% (1 Pick) and tied the analyst who picked second from last.

Our indicators didn’t stack up very well to the “experts” or national average at all. However, we noticed that our indicators were picking the wrong schools in completely obvious scenarios such as 1 vs. 16 matchups and other very high vs. very low seeded teams. These are generally the easy picks and not the ones we need help with. To counteract this we picked the top seeded team to automatically win in the following games: 1 vs. 16, 2 vs. 15, 3 vs. 14, 4 vs. 13, and 5 vs. 1. The top-seeded team was picked even if we know the higher seeded team won the game. Of these games there were four wrong picks out of 20 games.

We left 12 games to be decided by our indicators. These twelve games include the tough 8 vs. 9 matchup through the 6 vs. 11.

Figure 1 shows how these modified scenarios against the same unmodified scenarios.

Figure 1

As shown in the graph, the modified strategy beat the original strategy for every indicator. Every indicator went to 69% or greater and three strategies (Tuition (In-state), Admission Rate and 2012 endowment) either tied or beat the national average picks. Admission rates gave the best results at 78%.

Table 2 shows the performance with the comparators.

Table 2

The three top analysts and President Obama remained at the top, all picked over 80%. However, admission rate and 2012 endowment joined the upper ranks predicting better than the average pundits, the national average bracket and the “chalk” bracket.

By selecting the top ranked teams in the easy games and one of these indicators to predict the closer games our bracket beat the national average and the average analyst prediction.

NJBIZ Ranks Alliance Life Sciences in Top 10 Among Technology Consultant Service Companies in New Jersey

Alliance Life Sciences has been ranked number eight among New Jersey’s technology consultant service companies by NJBIZ’s Annual Book of Lists 2014, an influential source of information for business-to-business professionals in New Jersey.

“This ranking reflects our continued growth, our record 2013 year, the quality of our employees and their dedicated approach to serving our customers,” says Alan Crowther, CEO, ALSCG.  “We are honored to be recognized by the highly respected and influential NJBIZ, and applaud their focus on critical business issues.”

ALSCG serves over 40 of the largest pharmaceutical and medical device companies, including 8 of the top-10 largest pharmaceutical manufacturers, enabling them to focus on continued investments in patient health and well-being by helping them receive fair value for their products with an integrated portfolio of services:

  • Management Consulting
  • Technology Integration
  • Solutions and Data Services

ALSCG has many specialized offerings with top strategic positions in the industry, and delivers these services with expertise across the following domains:

  • Global Pricing, Reimbursement and Market Access
  • Contract Strategy, Operations and Compliance
  • Commercial Operations and Analytics

Crowther adds, “ALSCG helps its customers maximize revenue and optimize pricing in an outcomes-based world. We employ hundreds of professionals around the globe who help firms obtain the best value for their critical healthcare initiatives. This distinction helps bring attention to our leading set of offerings and set the stage for our customers’, and our, continued success.”

Video Series on Pricing & Market Access Issues in Pharma

Sophie Murdoch, VP of Consulting Services for ALSCG, is featured in a 3-part video series from Health Network Communications on Pricing & Market Access Issues in Pharma. The videos answer key questions that pharma manufacturers are facing today:

  • How are global austerity measures impacting pharma?
  • How can the industry work with payers to ensure that the best treatments get to patients?
  • What developments do you foresee over the next 12 months that will impact pharmaceutical uptake?

Watch the videos below!

Evolving Pharmaceutical Market Access in Brazil

This is an excerpt from our whitepaper, “Evolving Pharmaceutical Market Access in Brazil: How the Latest Developments Will Change your Business Strategy”. To read the full paper, please click here.

With expectations to reach 30% of the nearly $1.2 trillion US global spend, and
50-70% of the $70 billion annual US growth forecasted in the pharmaceutical
sector by 2016, it is clear why emerging markets are considered the new
frontier. They are the new hope for a pharmaceutical industry that is seeking
new strategies and partnerships to balance the stagnation in more mature
markets.

Quickly growing, increasingly competitive, culturally, socially and economically diverse, emerging markets defy the effectiveness of a uniform approach and call for local business planning based on a comprehensive and global perspective. For this reason, international pharmaceutical companies must be willing to implement market-specific strategies and local thinking within their global business strategy. Nevertheless evolving political stances, increasing international competition, and rising local manufacturers are toughening market access environments and creating new, and sometimes unexpected, risks for drug makers.

Brazil is one of many examples showing how quickly business conditions for drug makers are changing and how important it is to identify, evaluate, and foresee such changes as early as possible to improve and consolidate market positioning. This paper provides an overview of latest trends regarding pharmaceutical taxation, strategic partnerships and generics promotion.

Brazil Facts

Latest Reforms and New Challenges 

With over $220 billion of healthcare expenditure, a strong economic growth, and drug prices adjusted annually (2.7-6.31% increase estimated in 2013), Brazil is destined to become the third largest pharmaceutical market by 2020 after US and China.

Despite its strong economic growth, Brazil is facing increasing pressure to control healthcare expenditure and, at the same time, to promote innovation and improve access to healthcare.

Pursuing this difficult task, decision makers are discussing several initiatives, some of them already converted into law, which will reshape the pharmaceutical market in the following years. In a context of increasing competition and stricter regulatory hurdles, Brazil will become a much more challenging business environment.

To read more, please click here to download the white paper.

Anti-TNF Biosimilar Prices – How low will they go?

Benoit Donze – Pricing and Market Access Consultant

The patents of two anti-TNF agents are due to expire over the next two years, in 2014[1] for J&J’s Remicade®, and in 2015[2] for Amgen’s Enbrel®. Their loss of exclusivity will clear the way for the arrival of biosimilar agents, defined[3] as medicinal products which are similar to a biological medicinal product. The market access uptake of those biosimilars will be clearly facilitated by the economic crisis and by the payers’ willingness to reduce their healthcare expenditures. Thereby, biosimilars could represent one of the most important sources of savings over the next decade.

This article examines the possible pricing implications on the original drug and the anticipated price differentials between the original biologic and its associated biosimilar.

Study of pricing impact of biosimilars on their originator

The following analysis investigates the price differential between the price of biosimilars currently available on the market and their originator to predict prices of future biosimilars. This article does not take into consideration the complexity of anti-TNF biosimilars in term of clinical development, manufacturing and ‘similarity’ to branded anti-TNF which will for sure impact the price differential.

To date, three active substances have been approved for use in Europe by the Committee for Medicinal Products for Human Use (CHMP): filgrastim (a granulocyte colony-stimulating factor), epoetin (an erythropoietin stimulator) and somatropin (a human growth hormone). The table below shows the authorised biosimilars in the EU:

The following graphs illustrate the price differentials of Neupogen®, Eprex® and Genotropin® against their lowest priced biosimilar in EU5 (France, Germany, Italy, Spain and United Kingdom). The analysis is based on lowest ex-factory price per unit of the most available presentation.The observed price difference between the two products revealed a variation of -31% and +10%. The price difference in Spain remains constant for both G-CSF and epoetins at 30%. Current legislation in Spain states that biosimilars must be priced 30% below the price of the reference biological medicine. Interestingly, in the UK, Amgen’s strategy to remain competitive involved voluntarily price cuts to the original molecule Neupogen® resulting in the price of biosimilars being 10% higher than the originator.Taking an average of the price differentials across the three original biologics (Eprex®, Neupogen® and Genotropin®) and their biosimilars results in price differentials, ranging from -7% in the UK to      -30% in Spain. The calculation is based on lowest ex-factory price per unit of the two most available presentations (filgrastim 30MU and 48MU, epoetin 2000UI and 40000UI, somatropin 5.3mg and 12mg).

Currently, there are no mandatory price reductions imposed on the original biologic therapy after the entry of biosimilars. In the UK and Germany, there are no compulsory price reductions enforced on the biosimilar. In Spain, Italy and France, legislation states that biosimilars must be priced below the originator drug, 30% in Spain, at least 20% in Italy and at 15% in France.

 

What could we expect with anti-TNFs biosimilars?

Based on the analysis above, the anticipated price points of future anti-TNF biosimilars may be around 18% below the originator in France, 20% in Germany and Italy, 30% in Spain and 7% below the price of the original medicine in the UK.

We acknowledge that there are manufacturing issues (sophisticated technologies, processes, and high investments) associated with anti-TNFs biosimilars which translate to higher development costs than those required for current biosimilars. To date, Remsima® (first Remicade® monoclonal antibody to market), is only 5% less expensive than Remicade® in South Korea.

Moreover, the clinical efficacy and safety of these new biosimilar agents has not yet been confirmed. Pricing is one factor dictating market access: the lack of experience with anti-TNF biosimilars, safety and efficacy concerns (especially for biosimilars coming from Asia), and the reluctance to switch from physicians also play a significant role.

 


[1] MP advisors – Merck – Celltrion filed first mAB Biosimilar in Europe: Remicade Challenged – Consulted in January 2013

[2] Genetic Engineering & Biotechnology News – Firms Are Upping the Stakes on mAb Biosimilar Development – Consulted in January 2013

[3] EMA – Biosimilar medicines – consulted in January 2013