The Right PricePub Date : 2021-06-17DOI: 10.1093/OSO/9780197512883.003.0011
J. Peter, T. Joshua, A. OllendorfDaniel
{"title":"The Path Forward","authors":"J. Peter, T. Joshua, A. OllendorfDaniel","doi":"10.1093/OSO/9780197512883.003.0011","DOIUrl":"https://doi.org/10.1093/OSO/9780197512883.003.0011","url":null,"abstract":"Factors interfering with market-based alignment of drug prices and value make explicit value assessment necessary. The widely used quality-adjusted life year serves as a starting point because it accounts for both quality and length of life. Cost estimates could improve by accounting for drug price changes accompanying the loss of market exclusivity. Consistent use of a societal perspective when relevant would also improve value assessments. Prices should sometimes reflect government contributions to development, although such adjustments make the most sense when government facilitates late-stage research. The Institute for Clinical and Economic Review, a private group with a leading role in US value assessment, should make its analyses transparent and defer to payers regarding judgements about value. Finally, payers should embrace value-based pricing. They may not always get the lowest prices, but aligning price and value will mean society expends its resources efficiently and improves the population’s overall health.","PeriodicalId":165046,"journal":{"name":"The Right Price","volume":"353 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-06-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124464935","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The Right PricePub Date : 1900-01-01DOI: 10.1093/oso/9780197512883.003.0004
Neumann Peter J., Cohen Joshua T., Ollendorf Daniel A
{"title":"Measuring the Value of Prescription Drugs","authors":"Neumann Peter J., Cohen Joshua T., Ollendorf Daniel A","doi":"10.1093/oso/9780197512883.003.0004","DOIUrl":"https://doi.org/10.1093/oso/9780197512883.003.0004","url":null,"abstract":"This chapter recounts the evolution of methods to put a value on health benefits, a step crucial to appropriately pricing drugs. Early efforts valued life based on a worker’s productive output. “Willingness-to-pay” methods use surveys and examine real-world purchasing decisions to value life beyond productivity considerations. Cost-effectiveness analysis sidesteps explicitly pricing life by instead measuring an intervention’s cost per unit of health gained. A common currency for benefits called the quality-adjusted life year (QALY) facilitates cost-effectiveness ratio comparisons across diseases. Although controversial, the QALY packs information about longevity and quality of life, making it popular. Next, this chapter explains that economists down-weight (“discount”) future costs and benefits as less important than near term impacts. Finally, it explores the question of perspective—that is, whether an analysis should, for example, reflect only costs and benefits pertinent to health system payers or whether it should take a broader, “societal” perspective.","PeriodicalId":165046,"journal":{"name":"The Right Price","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125371855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}