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THE ‘DRUG VALUE’ IN THE EUROPEAN PHARMACEUTICAL SYSTEM
Pharmacological Research, Vol. 37, No. 5, 1998
THE ‘DRUG VALUE’ IN THE EUROPEAN PHARMACEUTICAL SYSTEM U
GIANNI BENZI a, and ADRIANA CECI b a
EMEA, European Agency for the E¨ aluation of Medicinal Products, London UK and b New Drugs E¨ aluation Unit, Ad¨ anced Biotechnological Centre, Geno¨ a, Italy Accepted 19 February 1998
European regulatory authorities ŽEMEA, European Commission. andror national pharmacological and medical decision-makers can utilise the drug value to help themselves to decide which drugs to define as really innovative instead of new, which regulations to implement, which drugs to include on formularies, or which restrictions to enforce. As economic research becomes widely accepted for pharmaceutical evaluation, it needs to utilise prospective rather than retrospective study design. Analyses conducted at the time of therapy have better access to patients and can obtain both more accurate information on consumption of resources and the impact of pharmacotherapy on non-monetary quality of life for patients, survival, comparative clinical effectiveness and economic outcomes within social health service or in wider economy. Q 1998 The Italian Pharmacological Society
QUALITY, SAFETY AND EFFICACY—THE CRITERIA TO CHARACTERISE THE MEDICINAL PRODUCTS The Council Directive 65r65rEEC w1x laid down the principle of granting pre-marketing authorisations for medicinal products in all Member States and that they should be granted the scientific grounds of quality, safety and efficacy without regard to socioeconomic considerations. The first Directive still forms the basis of the regulatory framework today. Ten years later, in 1975, Member States consolidated their experience and agreed on common principles for the granting of marketing authorisations and the testing of medicinal products for human use. The creation of the original CPMP ŽCommittee for Proprietary Medicinal Products. and the start of a ‘non-binding procedure’ marked an important development in Member State co-operation w2,3x. In 1981, similar provisions were adopted to cover veterinary medicinal products, including the creation of the original CVMP ŽCommittee for Veterinary Medicinal Products w4x.. Through these earlier Committees}which were composed of the representatives of the Member States and European Commission}it was hoped that the increasing level of harmonisation would make the conversion of national marketing authori-
U
Corresponding author.
1043]6618r98r050333]05r$ 25.00r0rfr980306
sations easier}first with the introduction of the multi-state procedure and later with direct presentation by research-based companies to the two Committees in the so-called ‘concertation procedure’ dealing with biotechnology products. From a general point of view, Member States recognised the importance of working together and accumulated experience, much of which was relevant to the European system. Unfortunately, the quoted procedures were not practically binding from the outset and did not systematically result in similar andror equivalent marketing authorisations throughout the European Union. Pharmaceuticals were an integral part of the ‘1985 White Paper’ on the completion of the internal market and all the relevant legislation was successfully adopted before the final deadline. This drive towards the completion of the ‘1992 single European market’ added a number of important pieces of legislation to the growing regulatory framework, extending European legislation to cover all industrially manufactured medicines Žincluding vaccines, blood derivatives, radiopharmaceuticals and homeopathic medicines.. The 1990s saw the publication of the most farreaching set of proposals, relating to the creation of the Agency and the new Community system for the granting of marketing authorisations. After 2.5 years of debate in the European Institutions ŽEuropean Parliament, European Commission, Social and Economic Committee., the Council of Ministers on Q1998 The Italian Pharmacological Society
334
22 July 1993 adopted the Council Regulation 2309r93rEEC w5x along with three Directives w6]8x introducing the necessary modifications to existing human and veterinary medicinal product legislation. One of the major innovations in the system was the transformation of the pre-existing Committees into fully fledged Scientific Committees and the introduction of both binding decisions through the centralised procedure and of binding arbitration through the decentralised procedure. Another innovation was the creation of the European Agency for the Evaluation of Medicinal Products ŽEMEA. to manage and co-ordinate the new system.
DEBATE ON THE CRITERIA FOR THE EVALUATION OF MEDICINAL PRODUCTS Quality Ždrug stability; drug substance; dosage form., safety Žsingle and repeated dose toxicity; short and long time toxicity; carcinogenicity; reproductive toxicology. and efficacy Žtherapeutical activity; clinical safety; doserresponse trials; good clinical practice. would remain the three basic criteria for the evaluation of the medicinal products. However, some European institutions had a lengthy discussion as to what decision to take about the possibility to qualify medicines also by the ‘drug value’}the non-monetary quality of life for patients, survival, comparative clinical effectiveness and economic outcomes within social health service or in wider economy, evaluated by efficiency studies and economic analyses. Efficiency means the use of health service resources in such ways as to ensure that they have maximum impact on health w9x using only those drugs which are effective in view of the evidence that few medical interventions are supported by solid scientific demonstration w10x. Economic evaluations of the drug value consider outcomes also in terms of improvements in the ‘quality of life’ of patients, which are inherently more difficult to assess than other items, such as the ‘survival’, defined by the death of patients w11x. The debate is open. In fact, European Companies sometimes emphasise the drug value to score a point for the promotion of new drugs into the marketplace but, contemporaneously, would be unwilling to accept the compulsory introduction of the quoted ‘value’ in their dossiers for the European authorisations. Furthermore, the European Commissioner reminded that the quality, safety and efficacy would remain the criteria for the evaluation of medicinal products, with no fourth hurdle of need w12x. In contrast, the Pharmaceutical Research and Manufacturers of America claimed that the pharmaceutical industry has been in the forefront in terms of documenting not only the quality, safety and efficacy, but also the ‘value’ of its products w13x.
Pharmacological Research, Vol. 37, No. 5, 1998
DRUG VALUE AND TECHNICAL-ECONOMIC EVALUATION OF DRUG THERAPY As from 1990 w14,15x the pharmaceutical products account for at least 10]15% of health expenditure representing a significant cost item; between 0.7 and 1.2% of gross domestic product in the EU and the USA. According to the pharmaceutical Companies, the drug prices have risen faster than other health care costs because of the increasing expense of research and development, the need to comply with more severe procedures for the authorisation and supervision of medicinal products, the shift to treatment for chronic and degenerative diseases, the rapid technical change which reduces the period during which a drug can be a market leader w16x. Governments developed a number of rules, interventions, schemes, suggestions, etc., aimed at controlling their expenditures on pharmaceuticals. Thus, Governments tend to more or less dominate the market for healthcare so that they provide in the USA 30]40% and in the EU 60]90% of total health expenditures. The nutcrackers of rising demand for care and increasing costs sometimes get goods and services down as the result in some systems. The EU, which has traditionally valued equity in access to care, is facing increases in waiting lists and critical limitations in the use of some drugs. An appropriate level of expenditure should be defined a posteriori by information about the health needs of the community, the effectiveness and costs of the preventative and curative therapies available to meet those needs in comparison with the resources across different possible uses in the country involved. In contrast, healthcare spending is determined a priori by a mixture of the political expediency of the country with its social history, price inflation, purchasing power, public borrowing, industry development, etc., w17x. Thus, resource growth for the social health service andror insurance companies is submitted to annual adjustments to compensate for the increase of drug prices, technological advance, the development of special interventions for priority pathological conditions, such as ageing, AIDS, mental illnesses, handicaps and so on. Different adjustments were introduced on many occasions in the European Member States. For example, copayments for subsidised drugs have been increased in a number of EU countries. Otherwise, some Governments restrict the rate of return that companies can earn on investment, leaving them free to set prices within this limit. However, the most common form of cost control is the use of drug lists or formularies for which Governments will, or will not, pay. For example, the Governments of France and Italy subsidise Žentirely or by copayment. only listed drugs, while the Governments of
Pharmacological Research, Vol. 37, No. 5, 1998
the Netherlands and Belgium have lists of drugs they will not subsidise. In order to control costs without decreasing the efficiency of resource allocation, some Governments have notified companies that they are required to include drug value determination by clinicalreconomic analysis in applications for inclusion on the list of subsidised drugs and have provided guidelines for them to use. Other Governments are informally encouraging companies to provide drug value information with their marketing applications and companies are independently sponsoring clinicalreconomic studies and using them to support marketing applications and promotional activities. This venture represented an attempt to include regulatory, social as well as economic factors in decisions about medical therapies by assessing the drug value in comparison with the implications of moving toward more equity in access to care w18,19x. In fact, prescribers are not constrained to use drugs rationally and cost effectively. Rational prescribing should consider the drug value because, for example, the cost of profligate use of new antibacterial agents is not simply the money wastefully spent but also the cost of increasing bacterial resistance. Local mechanisms, such as practice and hospital formularies and drugs and therapeutical committees, can have some effect, but the contributors to different formularies are likely to differ in expertise and in freedom from external influences and they will not be privy to the information on which licensing decisions are based w20x. It is important to ensure that the characteristics of therapeutical efficacyreffectiveness are not lost in the search for cost containment because the increased interest in efficiency studies and economic analyses could present certain drawbacks, including the possibility of bias Žespecially when industry funds research ., the absence of standardised methodology Žmaking comparisons between studies difficult., the paucity of skills in Governments to assess such studies, the eventual use either by Governments simply to control costs or by Companies to justify higher, not lower, prices for improved drugs w18,19,21,22x.
EVALUATION OF THE DRUG VALUE BY ECONOMIC ANALYSES According to the current view, the perspective of efficient resource use focuses predominantly on the costs of medicines with little or no attention to the drug value. It is only by examining therapeutical activity, costs and outcomes comprehensively in conjunction with one another that efficient resource utilisation can be achieved. However, a major distinction between clinical trials and economic evaluations is that the former provide mandatory data
335
which are monitored by governments, whereas economic data are required only in a few countries w11x. The general trend towards value for money scrutiny has encouraged increasing numbers of pharmaceutical companies to undertake clinicalreconomic appraisals of their medicines. Therefore pharmaceutical manufacturers are devoting time and resources also to learning about the classic techniques of economic evaluation and how to apply these methods to their proprietary medicinal products w23]28x by: Ž1. cost-minimisation analysis; Ž2. costeffectiveness analysis; Ž3. cost-utility analysis; and Ž4. cost-benefit analysis. The ‘cost-minimisation analysis’ compares full utilisation costs of proprietary medicinal products that otherwise achieve the same degree of clinical effectiveness, since straightforward comparisons based on price alone may portray an inaccurate picture of the true resource consequences of a prescribing decision. The ‘cost-effectiveness analysis’ evaluates the health-related true resource impacts of therapeutic alternatives by relating single measures of outcome, expressed in natural units Ždisability days reduced, ambulatory therapy, improvements in peak expiratory flow rate, etc.. to the costs of their achievement. The ‘cost-utility analysis’ depicts the comparisons between interventions within the same and across different therapy areas in terms of their impact on both survival and health-related quality of life. The ‘cost-benefit analysis’ represents a valuable method of economic appraisal to express the additional value of a treatment by all of the costs and benefits resulting from the use of a given medicine in monetary terms. The quality, safety and efficacy would remain the criteria for the evaluation of medicinal products, with no fourth hurdle of need w12x. The drug value does not seem to be, however, a fourth hurdle of need but represents a useful factor to characterise the quality, safety and efficacy of the medicines. On the other hand, because of the increasing perspective to generate the drug value for their products, some manufacturers have established or are establishing in-house teams dedicated to this new field of endeavour. Otherwise, the drug value may be defined by commissioning studies from external sources of expertise located either in the departments of the universities or in the private sector agencies which are establishing themselves in this field of endeavour w24,28x. However, relatively few prescribers, managers, functionaries, policy makers, etc., are familiar with the principles and methods of the evaluation of the drug value by economicrmedical analysis. Thus, many do not feel confident to interpret the data contained in these studies. In these circumstances, a
Pharmacological Research, Vol. 37, No. 5, 1998
336
good approach might be to establish specialist units within the health sector which are given responsibility for evaluating the findings of the analyses produced by, or on behalf of, the pharmaceutical companies and then communicating their assessments to key users of the information.
DRUG VALUE OF GENETICALLY ENGINEERED DRUGS The first reported pharmacoeconomic studies w29,30x began with the old biotechnology products, namely the conventional biological molecules by production techniques which utilise naturally occurring strains of organisms Žantibiotics, vitamins, steroids, enzymes, hormones and vaccines.. A careful evaluation of the drug value needs for the products by new biotechnology Žrecombinant DNA technology, monoclonal antibody techniques, cell fusion, etc.. that are increasingly playing a critical role in the search for treatments for severe Žas cancer, AIDS, Turner’s syndrome, myocardial infarction, etc.. or chronic diseases Žas Alzheimer’s disease, Parkinson’s disease, multiple sclerosis, diabetes, hepatitis, etc... Few researches have been conducted for recently approved genetically engineered medications and most of the literature in this field discusses some pharmacoeconomic principles or strategies, but this does not attempt to conduct analyses of the drug value. An important and obvious reason for these analyses lies in the high cost associated with developing drugs using biotechnological methods. In the general trend of cost-containment, questions will arise about the increased cost of the new biotechnological products, and healthcare professionals will demand information regarding cost-effectiveness, survival and quality of life}in other words, information regarding the drug value that could aid health care providers in choosing optimum therapy for their patients w31x.
DRUG VALUE AND EUROPEAN POLICY FOR THE PHARMACEUTICAL FIELD In accordance with the current European legislation, healthcare responsibility and pharmaceutical research funding rest entirely both with Companies and Member States, even when studies could be supported by some European Institutions Že.g. Directorate-General XII, V, etc... In contrast, the EU guarantees the new or innovative drug characteristics by the centralised and decentralised procedures. The development of the European pharmaceutical field suggests that the drug value does not seem to be a useless though decorative hurdle but represents a useful tool to characterise the quality, safety and
efficacy of the proprietary medicinal products. Of course, it needs to do things one at a time and the first need is represented by the recognition of the best unique and unanimous methodology to define the drug value. It is an everyday occurrence that the data required for a particular drug value definition may not always be available. Therefore the analytical input to decision-making needs to be capable of standing up to rigorous expert inspection, being in the industry’s own interests to undertake good quality work, not only to reassure the critics, but also to avoid the possibility of having, e.g. Good ClinicalrEconomic Practice Regulations imposed by external authorities. Thus, the academic experts Žeconomists, pharmacologists, clinicians, etc.. who undertake analyses of new medicines, the pharmaceutical industry and the international regulatory Authorities ŽEuropean Commission, EMEA. should establish appropriate professional relationships. Investigators should publish valid results regardless of their promotional value to the sponsoring company, and scientific journal editors should try to avoid a bias against publishing negative results. Even if the winding interest of the pharmaceutical companies in clinicalreconomic research is to promote sales, such conflict should serve as an encouragement, not as a barrier, to more open and direct dialogue between regulatoryrhealth Authorities, academic researchers and the pharmaceutical industry w17,21,23,28x.
REFERENCES 1. Council Directive 65r65rEEC. On the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products. 26 January 1965. 2. Council Directive 75r318rEEC. On the approximation of the laws of MS relating to analytical, pharmaco-toxicological and clinical standards and protocols in respect of the testing of proprietary medicinal products. 20 May 1975. 3. Council Directive 75r319rEEC. On the approximation of provisions laid down by law, regulation or administrative action relating to proprietary medicinal products. 20 May 1975. 4. Council Directive 81r852rEEC. On the approximation of the laws of the MS relating to analytical, pharmaco-toxicological, and clinical standards and protocols in respect of the testing of veterinary medicinal products. 28 September 1981. 5. Council Regulation 2309r93rEEC. Laying down Community procedures for the authorisation and supervision of medicinal products for human and veterinary use and establishing a European Agency for the Evaluation of Medicinal Products. 22 July 1993. 6. Council Directive 93r39rEEC. Amending Directives 65r65rEEC, 75r318rEEC and 75r319rEEC in respect of medicinal products. 14 June 1993. 7. Council Directive 93r40rEEC. Amending Directives 81r851rEEC and 81r852rEEC on the approxima-
Pharmacological Research, Vol. 37, No. 5, 1998
8.
9. 10. 11. 12. 13.
15. 14. 16. 17.
18. 19.
20. 21.
tion of the laws of the Member States relating to veterinary medicinal products. 14 June 1993. Council Directive 93r41rEEC. Repealing Directive 87r22rEEC on the approximation of national measures relating to the placing on the market of hightechnology medicinal products, particularly those derived from biotechnology. 14 June 1993. Culyer AJ. The promise of a reformed NHS: an economist’s angle. Br Med J 1991; 302: 1253]6. Smith R. Where is the wisdom? The poverty of medical evidence. Br Med J 1991; 303: 798]9. Drummond MF. Economic evaluation of pharmaceuticals. Science or marketing? PharmacoEconomics 1992; 1: 8]13. Bangemann M. Second conference on the new European marketing authorisation system. EMEA-London, 21 October 1996. Pharmaceutical Research and Manufacturers of America. Methodological and conduct principles for pharmacoeconomic research. Drug Benefit Trends 1996; 34: 28]32. Editorial. Priceless medicines. Economist 1991; 26 October: 14]15. Editorial. Healthy results. Economist 1991; 26 October: 85. Di Masi JA, Hansen RW, Grabowski HG, Lasagna L. Cost of innovation in the pharmaceutical industry. J Health Econ 1991; 10: 107]42. Genduso LA, Kotsanos JG. Review of health economic guidelines in the form of regulations, principles, policies, and positions. Drug Inf J 1996; 30: 1003]16. Evans DB. The changing healthcare environment. PharmacoEconomics 1992; 1: 5]7. Henry D. Economic analysis as an aid to subsidisation decisions: the development of Australian guidelines for pharmaceuticals. PharmacoEconomics 1992; 1: 54]67. Ferner RE. Newly licensed drugs. Should be on probation until their value is demonstrated. Br Med J 1996; 313: 1157]8. Hillman AL, Eisenberg JM, Pauly MV, Bloom BS,
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22. 23.
24. 25.
26.
27.
28. 29.
30. 31.
Glick H. Avoiding bias in the conduct and reporting of cost-effectiveness research sponsored by pharmaceutical companies. N Engl J Med 1991; 324: 1362]5. Luce BR, Elixhauser A. Standards for socio-economic e¨ aluation of health care products and ser¨ ices. Springer-Verlag, Berlin, 1990. Drummond MF, O’Brien BJ, Stoddart GL, Torrance GW. Methods for the Economic E¨ aluation of Health Care Programmes, 2nd edn. Oxford: Oxford University Press, 1997. Freund DA, Dittus RS. Principles of pharmacoeconomic analysis of drug therapy. PharmacoEconomics 1992; 1: 20]32. Russel LB, Gold MR, Siegel JE, Daniel N, Weinstein MC, for the Panel on Cost-Effectiveness in Health and Medicine. The role of cost-effectiveness analysis in health and medicine. J Am Med Assoc l996; 276: 1172]7. Siegel JE, Weinstein MC, Russel LB, Gold MR, for the Panel on Cost-Effectiveness in Health and Medicine. Recommendations for reporting cost-effectiveness analysis. J Am Med Assoc l996; 276; 1339]41. Weinstein MC, Siegel JE, Gold MR, Kamlet MS, Russel LB, for the Panel on Cost-Effectiveness in Health and Medicine. Recommendations of the panel on cost-effectiveness in health and medicine. J Am Med Assoc 1996; 276:1253]8. Wells N. Economic evaluation of drugs. PharmacoEconomics 1992; 1: 14]19. Amadio J, Mueller J, Casey R. Benefitr cost ratios in public health. Illinois Department of Public Health, Southern Illinois University, Carbondale and Jackson County Health Department, August 1976. Bootman JL, McGhan WF. A perspective on the cost-benefit of drug therapy. J Clin Res Pract Drug Regul Affairs 1985; 3: 53]69. Jones-Grizzle AJ, Bootman JL. Pharmacoeconomics of genetically engineered drugs. PharmacoEconomics 1992; 1: 45]53.
THE ‘DRUG VALUE’ IN THE EUROPEAN PHARMACEUTICAL SYSTEM U
GIANNI BENZI a, and ADRIANA CECI b a
EMEA, European Agency for the E¨ aluation of Medicinal Products, London UK and b New Drugs E¨ aluation Unit, Ad¨ anced Biotechnological Centre, Geno¨ a, Italy Accepted 19 February 1998
European regulatory authorities ŽEMEA, European Commission. andror national pharmacological and medical decision-makers can utilise the drug value to help themselves to decide which drugs to define as really innovative instead of new, which regulations to implement, which drugs to include on formularies, or which restrictions to enforce. As economic research becomes widely accepted for pharmaceutical evaluation, it needs to utilise prospective rather than retrospective study design. Analyses conducted at the time of therapy have better access to patients and can obtain both more accurate information on consumption of resources and the impact of pharmacotherapy on non-monetary quality of life for patients, survival, comparative clinical effectiveness and economic outcomes within social health service or in wider economy. Q 1998 The Italian Pharmacological Society
QUALITY, SAFETY AND EFFICACY—THE CRITERIA TO CHARACTERISE THE MEDICINAL PRODUCTS The Council Directive 65r65rEEC w1x laid down the principle of granting pre-marketing authorisations for medicinal products in all Member States and that they should be granted the scientific grounds of quality, safety and efficacy without regard to socioeconomic considerations. The first Directive still forms the basis of the regulatory framework today. Ten years later, in 1975, Member States consolidated their experience and agreed on common principles for the granting of marketing authorisations and the testing of medicinal products for human use. The creation of the original CPMP ŽCommittee for Proprietary Medicinal Products. and the start of a ‘non-binding procedure’ marked an important development in Member State co-operation w2,3x. In 1981, similar provisions were adopted to cover veterinary medicinal products, including the creation of the original CVMP ŽCommittee for Veterinary Medicinal Products w4x.. Through these earlier Committees}which were composed of the representatives of the Member States and European Commission}it was hoped that the increasing level of harmonisation would make the conversion of national marketing authori-
U
Corresponding author.
1043]6618r98r050333]05r$ 25.00r0rfr980306
sations easier}first with the introduction of the multi-state procedure and later with direct presentation by research-based companies to the two Committees in the so-called ‘concertation procedure’ dealing with biotechnology products. From a general point of view, Member States recognised the importance of working together and accumulated experience, much of which was relevant to the European system. Unfortunately, the quoted procedures were not practically binding from the outset and did not systematically result in similar andror equivalent marketing authorisations throughout the European Union. Pharmaceuticals were an integral part of the ‘1985 White Paper’ on the completion of the internal market and all the relevant legislation was successfully adopted before the final deadline. This drive towards the completion of the ‘1992 single European market’ added a number of important pieces of legislation to the growing regulatory framework, extending European legislation to cover all industrially manufactured medicines Žincluding vaccines, blood derivatives, radiopharmaceuticals and homeopathic medicines.. The 1990s saw the publication of the most farreaching set of proposals, relating to the creation of the Agency and the new Community system for the granting of marketing authorisations. After 2.5 years of debate in the European Institutions ŽEuropean Parliament, European Commission, Social and Economic Committee., the Council of Ministers on Q1998 The Italian Pharmacological Society
334
22 July 1993 adopted the Council Regulation 2309r93rEEC w5x along with three Directives w6]8x introducing the necessary modifications to existing human and veterinary medicinal product legislation. One of the major innovations in the system was the transformation of the pre-existing Committees into fully fledged Scientific Committees and the introduction of both binding decisions through the centralised procedure and of binding arbitration through the decentralised procedure. Another innovation was the creation of the European Agency for the Evaluation of Medicinal Products ŽEMEA. to manage and co-ordinate the new system.
DEBATE ON THE CRITERIA FOR THE EVALUATION OF MEDICINAL PRODUCTS Quality Ždrug stability; drug substance; dosage form., safety Žsingle and repeated dose toxicity; short and long time toxicity; carcinogenicity; reproductive toxicology. and efficacy Žtherapeutical activity; clinical safety; doserresponse trials; good clinical practice. would remain the three basic criteria for the evaluation of the medicinal products. However, some European institutions had a lengthy discussion as to what decision to take about the possibility to qualify medicines also by the ‘drug value’}the non-monetary quality of life for patients, survival, comparative clinical effectiveness and economic outcomes within social health service or in wider economy, evaluated by efficiency studies and economic analyses. Efficiency means the use of health service resources in such ways as to ensure that they have maximum impact on health w9x using only those drugs which are effective in view of the evidence that few medical interventions are supported by solid scientific demonstration w10x. Economic evaluations of the drug value consider outcomes also in terms of improvements in the ‘quality of life’ of patients, which are inherently more difficult to assess than other items, such as the ‘survival’, defined by the death of patients w11x. The debate is open. In fact, European Companies sometimes emphasise the drug value to score a point for the promotion of new drugs into the marketplace but, contemporaneously, would be unwilling to accept the compulsory introduction of the quoted ‘value’ in their dossiers for the European authorisations. Furthermore, the European Commissioner reminded that the quality, safety and efficacy would remain the criteria for the evaluation of medicinal products, with no fourth hurdle of need w12x. In contrast, the Pharmaceutical Research and Manufacturers of America claimed that the pharmaceutical industry has been in the forefront in terms of documenting not only the quality, safety and efficacy, but also the ‘value’ of its products w13x.
Pharmacological Research, Vol. 37, No. 5, 1998
DRUG VALUE AND TECHNICAL-ECONOMIC EVALUATION OF DRUG THERAPY As from 1990 w14,15x the pharmaceutical products account for at least 10]15% of health expenditure representing a significant cost item; between 0.7 and 1.2% of gross domestic product in the EU and the USA. According to the pharmaceutical Companies, the drug prices have risen faster than other health care costs because of the increasing expense of research and development, the need to comply with more severe procedures for the authorisation and supervision of medicinal products, the shift to treatment for chronic and degenerative diseases, the rapid technical change which reduces the period during which a drug can be a market leader w16x. Governments developed a number of rules, interventions, schemes, suggestions, etc., aimed at controlling their expenditures on pharmaceuticals. Thus, Governments tend to more or less dominate the market for healthcare so that they provide in the USA 30]40% and in the EU 60]90% of total health expenditures. The nutcrackers of rising demand for care and increasing costs sometimes get goods and services down as the result in some systems. The EU, which has traditionally valued equity in access to care, is facing increases in waiting lists and critical limitations in the use of some drugs. An appropriate level of expenditure should be defined a posteriori by information about the health needs of the community, the effectiveness and costs of the preventative and curative therapies available to meet those needs in comparison with the resources across different possible uses in the country involved. In contrast, healthcare spending is determined a priori by a mixture of the political expediency of the country with its social history, price inflation, purchasing power, public borrowing, industry development, etc., w17x. Thus, resource growth for the social health service andror insurance companies is submitted to annual adjustments to compensate for the increase of drug prices, technological advance, the development of special interventions for priority pathological conditions, such as ageing, AIDS, mental illnesses, handicaps and so on. Different adjustments were introduced on many occasions in the European Member States. For example, copayments for subsidised drugs have been increased in a number of EU countries. Otherwise, some Governments restrict the rate of return that companies can earn on investment, leaving them free to set prices within this limit. However, the most common form of cost control is the use of drug lists or formularies for which Governments will, or will not, pay. For example, the Governments of France and Italy subsidise Žentirely or by copayment. only listed drugs, while the Governments of
Pharmacological Research, Vol. 37, No. 5, 1998
the Netherlands and Belgium have lists of drugs they will not subsidise. In order to control costs without decreasing the efficiency of resource allocation, some Governments have notified companies that they are required to include drug value determination by clinicalreconomic analysis in applications for inclusion on the list of subsidised drugs and have provided guidelines for them to use. Other Governments are informally encouraging companies to provide drug value information with their marketing applications and companies are independently sponsoring clinicalreconomic studies and using them to support marketing applications and promotional activities. This venture represented an attempt to include regulatory, social as well as economic factors in decisions about medical therapies by assessing the drug value in comparison with the implications of moving toward more equity in access to care w18,19x. In fact, prescribers are not constrained to use drugs rationally and cost effectively. Rational prescribing should consider the drug value because, for example, the cost of profligate use of new antibacterial agents is not simply the money wastefully spent but also the cost of increasing bacterial resistance. Local mechanisms, such as practice and hospital formularies and drugs and therapeutical committees, can have some effect, but the contributors to different formularies are likely to differ in expertise and in freedom from external influences and they will not be privy to the information on which licensing decisions are based w20x. It is important to ensure that the characteristics of therapeutical efficacyreffectiveness are not lost in the search for cost containment because the increased interest in efficiency studies and economic analyses could present certain drawbacks, including the possibility of bias Žespecially when industry funds research ., the absence of standardised methodology Žmaking comparisons between studies difficult., the paucity of skills in Governments to assess such studies, the eventual use either by Governments simply to control costs or by Companies to justify higher, not lower, prices for improved drugs w18,19,21,22x.
EVALUATION OF THE DRUG VALUE BY ECONOMIC ANALYSES According to the current view, the perspective of efficient resource use focuses predominantly on the costs of medicines with little or no attention to the drug value. It is only by examining therapeutical activity, costs and outcomes comprehensively in conjunction with one another that efficient resource utilisation can be achieved. However, a major distinction between clinical trials and economic evaluations is that the former provide mandatory data
335
which are monitored by governments, whereas economic data are required only in a few countries w11x. The general trend towards value for money scrutiny has encouraged increasing numbers of pharmaceutical companies to undertake clinicalreconomic appraisals of their medicines. Therefore pharmaceutical manufacturers are devoting time and resources also to learning about the classic techniques of economic evaluation and how to apply these methods to their proprietary medicinal products w23]28x by: Ž1. cost-minimisation analysis; Ž2. costeffectiveness analysis; Ž3. cost-utility analysis; and Ž4. cost-benefit analysis. The ‘cost-minimisation analysis’ compares full utilisation costs of proprietary medicinal products that otherwise achieve the same degree of clinical effectiveness, since straightforward comparisons based on price alone may portray an inaccurate picture of the true resource consequences of a prescribing decision. The ‘cost-effectiveness analysis’ evaluates the health-related true resource impacts of therapeutic alternatives by relating single measures of outcome, expressed in natural units Ždisability days reduced, ambulatory therapy, improvements in peak expiratory flow rate, etc.. to the costs of their achievement. The ‘cost-utility analysis’ depicts the comparisons between interventions within the same and across different therapy areas in terms of their impact on both survival and health-related quality of life. The ‘cost-benefit analysis’ represents a valuable method of economic appraisal to express the additional value of a treatment by all of the costs and benefits resulting from the use of a given medicine in monetary terms. The quality, safety and efficacy would remain the criteria for the evaluation of medicinal products, with no fourth hurdle of need w12x. The drug value does not seem to be, however, a fourth hurdle of need but represents a useful factor to characterise the quality, safety and efficacy of the medicines. On the other hand, because of the increasing perspective to generate the drug value for their products, some manufacturers have established or are establishing in-house teams dedicated to this new field of endeavour. Otherwise, the drug value may be defined by commissioning studies from external sources of expertise located either in the departments of the universities or in the private sector agencies which are establishing themselves in this field of endeavour w24,28x. However, relatively few prescribers, managers, functionaries, policy makers, etc., are familiar with the principles and methods of the evaluation of the drug value by economicrmedical analysis. Thus, many do not feel confident to interpret the data contained in these studies. In these circumstances, a
Pharmacological Research, Vol. 37, No. 5, 1998
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good approach might be to establish specialist units within the health sector which are given responsibility for evaluating the findings of the analyses produced by, or on behalf of, the pharmaceutical companies and then communicating their assessments to key users of the information.
DRUG VALUE OF GENETICALLY ENGINEERED DRUGS The first reported pharmacoeconomic studies w29,30x began with the old biotechnology products, namely the conventional biological molecules by production techniques which utilise naturally occurring strains of organisms Žantibiotics, vitamins, steroids, enzymes, hormones and vaccines.. A careful evaluation of the drug value needs for the products by new biotechnology Žrecombinant DNA technology, monoclonal antibody techniques, cell fusion, etc.. that are increasingly playing a critical role in the search for treatments for severe Žas cancer, AIDS, Turner’s syndrome, myocardial infarction, etc.. or chronic diseases Žas Alzheimer’s disease, Parkinson’s disease, multiple sclerosis, diabetes, hepatitis, etc... Few researches have been conducted for recently approved genetically engineered medications and most of the literature in this field discusses some pharmacoeconomic principles or strategies, but this does not attempt to conduct analyses of the drug value. An important and obvious reason for these analyses lies in the high cost associated with developing drugs using biotechnological methods. In the general trend of cost-containment, questions will arise about the increased cost of the new biotechnological products, and healthcare professionals will demand information regarding cost-effectiveness, survival and quality of life}in other words, information regarding the drug value that could aid health care providers in choosing optimum therapy for their patients w31x.
DRUG VALUE AND EUROPEAN POLICY FOR THE PHARMACEUTICAL FIELD In accordance with the current European legislation, healthcare responsibility and pharmaceutical research funding rest entirely both with Companies and Member States, even when studies could be supported by some European Institutions Že.g. Directorate-General XII, V, etc... In contrast, the EU guarantees the new or innovative drug characteristics by the centralised and decentralised procedures. The development of the European pharmaceutical field suggests that the drug value does not seem to be a useless though decorative hurdle but represents a useful tool to characterise the quality, safety and
efficacy of the proprietary medicinal products. Of course, it needs to do things one at a time and the first need is represented by the recognition of the best unique and unanimous methodology to define the drug value. It is an everyday occurrence that the data required for a particular drug value definition may not always be available. Therefore the analytical input to decision-making needs to be capable of standing up to rigorous expert inspection, being in the industry’s own interests to undertake good quality work, not only to reassure the critics, but also to avoid the possibility of having, e.g. Good ClinicalrEconomic Practice Regulations imposed by external authorities. Thus, the academic experts Žeconomists, pharmacologists, clinicians, etc.. who undertake analyses of new medicines, the pharmaceutical industry and the international regulatory Authorities ŽEuropean Commission, EMEA. should establish appropriate professional relationships. Investigators should publish valid results regardless of their promotional value to the sponsoring company, and scientific journal editors should try to avoid a bias against publishing negative results. Even if the winding interest of the pharmaceutical companies in clinicalreconomic research is to promote sales, such conflict should serve as an encouragement, not as a barrier, to more open and direct dialogue between regulatoryrhealth Authorities, academic researchers and the pharmaceutical industry w17,21,23,28x.
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