Protecting the patient in value-based pricing schemes.

BACKGROUND

Heterogeneity in patients' responses across and within patient groups is redesigning research and pricing policies, since a uniform price may not be able to capture differences in health benefits across indications. However, pricing mechanisms may create strategic behaviors that may reduce drug availability for some groups of patients.

METHOD: In this narrative review we define a common framework to compare different forms of pricing policies that are currently used in the presence of heterogeneity in indication and patients' characteristics.

RESULTS

When heterogeneity derives from verifiable differences, Indication-value-Based Prices (IBP) may increase ex-post effectiveness, but they may reduce access. Furthermore, IBPs may be difficult to implement in practice. When uncertainty depends also on unverifiable patients' characteristics, performance-based price schemes are sub-optimal because they increase/reduce access according to how generous they are. Real-world evidence shows that operational complexity, high administrative costs, and information asymmetry frequently reduce their benefits.

CONCLUSIONS

Personalized medicine opens new treatment possibilities but poses new challenges as concerns price strategies. Performance-based prices, which are the natural candidates to reimburse drugs, may reduce or delay drug availability across patients' groups. Regulators should enforce transparency, and designing multi-indication pricing architectures such as blended agreements that protect patient access.