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Balancing Specialty Drug Pricing and Innovation ? A Framework for Sustainable Access and Affordability in the U.S. Healthcare System
Subject area: Management and Commerce · Area of research: Healthcare Management
DOI: 10.64388/IREV8I2-1711831-4391
Abstract
The U.S. healthcare system is facing a serious and unsustainable dilemma between the two-fold purpose of innovation in specialty drugs as an incentive and affordable and equitable access to patients. High prices caused by expensive biologic drugs and transformative cell and gene therapy and present significant access barriers to patients threaten the financial stability of the payers. The following discussion is a summary of a detailed analysis of such sources as IQVIA, the Centers of Medicare and Medicaid Services (CMS), and the Assistant Secretary of Planning and Evaluation (ASPE) to quantify the spending trends, the budget implications, and the multi-faceted character of the correlation between the price, innovation, and accessibility to patients. Two new inter-related systems have to be used to address this systemic issue; a multi-attribute Value-Sustainability Index (VSI) to capture comprehensively the therapeutic, innovative and systemic value of a drug and a National Affordability Threshold (NAT) to provide a base to price debate on macroeconomic reality. These quantitative figures indicate that the increase in the amount of Medicare Part D gross expenditure by 566.5 percent in 2012-2021 resulted in an economic amount exceeding 50 percent of the spending on specialty drugs, with much of that highly concentrated within the top 1 percent of the drugs which have caused over 41 percent of Part D spending.2 Discussion The author concludes the manuscript by pleading to implement the VSI and NAT frameworks through a multi-stakeholder and voluntary Sustainable Access Compact. This small would assist in introducing value-consistent payment models, such as outcomes-based contracting and indication-based pricing, in order to create a predictable and long-term market that does not merely compensate the actual innovation but also brings transformative medicines to the patients that need them.
References
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How to cite this paper
@article{1711831,
author = {Dr. Richard Amissah},
title = {Balancing Specialty Drug Pricing and Innovation ? A Framework for Sustainable Access and Affordability in the U.S. Healthcare System},
journal = {Iconic Research And Engineering Journals},
year = {2024},
volume = {8},
number = {2},
pages = {1158-1169},
issn = {2456-8880},
url = {https://www.irejournals.com/formatedpaper/1711831.pdf},
abstract = {The U.S. healthcare system is facing a serious and unsustainable dilemma between the two-fold purpose of innovation in specialty drugs as an incentive and affordable and equitable access to patients. High prices caused by expensive biologic drugs and transformative cell and gene therapy and present significant access barriers to patients threaten the financial stability of the payers. The following discussion is a summary of a detailed analysis of such sources as IQVIA, the Centers of Medicare and Medicaid Services (CMS), and the Assistant Secretary of Planning and Evaluation (ASPE) to quantify the spending trends, the budget implications, and the multi-faceted character of the correlation between the price, innovation, and accessibility to patients. Two new inter-related systems have to be used to address this systemic issue; a multi-attribute Value-Sustainability Index (VSI) to capture comprehensively the therapeutic, innovative and systemic value of a drug and a National Affordability Threshold (NAT) to provide a base to price debate on macroeconomic reality. These quantitative figures indicate that the increase in the amount of Medicare Part D gross expenditure by 566.5 percent in 2012-2021 resulted in an economic amount exceeding 50 percent of the spending on specialty drugs, with much of that highly concentrated within the top 1 percent of the drugs which have caused over 41 percent of Part D spending.2 Discussion The author concludes the manuscript by pleading to implement the VSI and NAT frameworks through a multi-stakeholder and voluntary Sustainable Access Compact. This small would assist in introducing value-consistent payment models, such as outcomes-based contracting and indication-based pricing, in order to create a predictable and long-term market that does not merely compensate the actual innovation but also brings transformative medicines to the patients that need them.},
month = {August},
doi = {https://doi.org/10.64388/IREV8I2-1711831-4391}
}