The Relationship Between Cost Effectiveness and Affordability in Health Care

A Look at How Innovative, High-Cost Therapies Stress Payer Budgets

 

Boston, MA—May 23, 2017—The International Society for Pharmacoeconomics and Outcomes Research (ISPOR) hosted a session this morning at its 22nd Annual International Meeting in Boston, MA, USA that examined the relationship between cost effectiveness and affordability of health care therapies.

The issue panel session, Perspectives on the Relationship Between Cost Effectiveness and Affordability [IP9], was moderated by Adrian Towse, MA, MPhil, Director, Office of Health Economics, London, UK. Panelists included:

  • Mark Sculpher, PhD, Professor of Health Economics, Centre for Health Economics and Director, University of York, Heslington, York, UK
  • Patricia M. Danzon, PhD, Celia Moh Professor Emeritus, The Wharton School, University of Pennsylvania, Philadelphia, PA, USA
  • Steven D. Pearson, MD, MSc, Founder and President, Institute for Clinical and Economic Review, Boston, MA, USA

This session explored the question, “Can a drug be cost effective, but not affordable?” This issue gains increasing importance as new therapies for hepatitis C and the prospect of gene therapies and treatments for Alzheimer’s have elevated the issue of affordability for payers.

Adrian Towse, MA, MPhil, provided context for the panel discussion by reviewing a report from an interview program with US and European payers. Patricia M. Danzon, PhD examined the issue of value-based pricing using cost-effectiveness analysis and how this might be adapted to avoid disincentivizing innovation. Mark Sculpher, PhD presented research that maintains an empirical estimate of the cost-effectiveness threshold based on opportunity cost is needed to guide decisions. Steven D. Pearson, MD, MSc discussed the rationale for the use of budget thresholds as well as cost-effectiveness thresholds when assessing the value of new products. 

Additional information on the ISPOR 22nd Annual International Meeting can be found here. Released presentations from the conference can be found here. Interested parties can follow conference news at ISPOR’s press site and on social media using the conference hashtag #ISPORBoston.

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ABOUT ISPOR
The International Society for Pharmacoeconomics and Outcomes Research (ISPOR) is a nonprofit, international, educational and scientific organization that promotes health economics and outcomes research excellence to improve decision making for health globally.
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