Pharmacoeconomics And IP Strategies In Drug Development

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9/25/2014Next in the Drug Discovery Series!“Future of Drug Discovery:Challenges, Risks, and Rewards”Thursday, October 30, 2014“Pharmacoeconomics and IP Strategiesin Drug Development”Dr. Robert KochDr. Richard WillkePartner and IP Specialist,MilbankVP of Outcomes & Evidence,PfizerDr. Joseph FortunakProfessor of Chemistry,Howard UniversityRecordings will be available to ACS members after three weekswww.acs.org/acswebinarsContact ACS Webinars at acswebinars@acs.org 7

9/25/2014Pharmacoeconomicsin Drug DevelopmentRichard Willke, Ph.D.Vice President, Outcomes & EvidenceSeptember 25, 2014What Will You Learn? What “cost-effectiveness” means for drug productsand how payers perceive their value How patient outcomes fit into pharmacoeconomics The role that pharmacoeconomics plays in the drugdevelopment cycle16 8

9/25/2014What Will You Learn? What “cost-effectiveness” means for drug productsand how payers perceive their value How patient outcomes fit into pharmacoeconomics The role that pharmacoeconomics plays in the drugdevelopment cycle17The Healthcare Environment Has Changed ClinicalDevelopment20thcentury Marketingauthorization Marketing &SalesMarketAccess ClinicalDevelopment21stcentury Marketingauthorization Marketing &Sales18 9

9/25/2014Market Access: Affected by Many FactorsMedicalRegulatory approvalComparative effectiveness/relative effectivenessExternal health system environmentHealth technology assessmentPharmacoeconomic evaluationConditional reimbursementPricing & cost containmentEconomic19Where is Pharmacoeconomic Evaluation Relevant?There are 4 Archetypes of PayersNegotiations-driven markets(France, Italy, Spain): Nationalpricing and reimbursement agencieswith specific requirements, oftenlengthy negotiations process.Free pricing markets (USA):Independent insurance companiesand payer entities, laws of marketeconomics are most relevant here.Pharmacoeconomic evaluation usedby some payers.HTA-driven markets (UK,Neth., Canada, Australia):Quantitative, formalistic approachdriven by health economics.Non-reimbursed markets(emerging markets): Still need toprice products and get governmentapproval.20 10

9/25/2014Pharmacoeconomics and theBasic Elements of Measuring ValueCost: How does the newBenefit: What’s the netproduct affect overalltreatment costs?health benefit from the newproduct, compared to others?Budget ImpactComparative effectivenessCost-benefit (aka cost-effectiveness) ratio:What’s the cost per additional unit of health? Is the patientor society willing to pay that much for the new product?Value for money21Pharmacoeconomic Evaluation ParametersPatient benefitsNew productDirect costs(impact onhealthresource use)TargetpopulationCurrentpracticeIndirect costseffectivenesssurvivalquality of lifepatient preferenceshospital careoutpatient careprimary caremedicationlong-term carelost productivitytime lost from usualactivitiessocial costs (eg.caregiver time,childcare)22 11

9/25/2014How is Cost-effectiveness Judged? Cost-Minimization– Reducing overall treatment costs is always good, as long as outcomes are no worse– Most common situation is when drugs go generic, so choosing generic drugs over brandeddrugs in the same class usually reduces treatment costs Cost-effectiveness– Within disease Reasonable cost per “endpoint improvement” , e.g., cost per stroke avoided, compared to other therapies Varies by disease– Across diseases Pharmacoeconomic endpoint is “quality-adjusted life-year” (QALY); can be used in any disease Choose therapies with a reasonable cost per quality-adjusted life year saved In the UK, “reasonable” means less than 20,000 - 30,000 per QALY In the US, “reasonable” is more like 100,000 per QALY, though it’s not specifically set by most payers andcan vary by condition23Audience Survey QuestionWhich of the following countries was thefirst European country to establishpharmacoeconomic guidelines? BelgiumThe NetherlandsPortugalGermanyFrance 24 12

9/25/2014Pharmacoeconomic GuidelinesAround the World25What Will You Learn? What “cost-effectiveness” means for drug productsand how payers perceive their value How patient outcomes fit into pharmacoeconomics The role that pharmacoeconomics plays in the drugdevelopment cycle26 13

9/25/2014GI symptomsbother me!I m worriedand concernedHeartburndisturbs mysleepI cannot bendover or exerciseMy whole life isaffectedI cannot eat anddrink whateverI like27Patient Outcomes AssessmentSources and Examples Clinician - Reported Physiological Caregiver - Reported Patient - ReportedFor Example:For Example:For Example:Global impressionsObservation & testsof functionFEV1HbA1cTumor sizeFor Example:DependencyFunctional statusGlobal ImpressionFunctional statusWell-beingSymptomsSatisfaction with TXTreatment adherence28 14

9/25/2014Health-Related Quality of Life (HRQL)A person’s subjective perception of theimpact of health status,including disease and treatment,onphysical, psychological, and socialfunctioning and well-being(Leidy, Revicki, Geneste, 1999)29Patient-Reported Outcome Study MethodsWith what? Validated questionnaires “Generic” or disease-specific instrumentsIn Clinical Trials As a primary or secondary endpoint Tested for clinically meaningful differencesdue to treatment May be included in drug labelingOther sources Electronic medical record Disease-specific patient registry On-line surveys30 15

9/25/2014What Will You Learn? What “cost-effectiveness” means for drug products andhow payers perceive their value How patient outcomes fit into pharmacoeconomics The role that pharmacoeconomics plays in the drugdevelopment cycleTerminology Note: “Pharmacoeconomics” is anaspect of the broader field of “OutcomesResearch”; sometimes the terms are usedtogether or interchangeably31Outcomes Research and the Product CycleInitial awareness,preliminary planningDiscoveryResearch Exploratory Full Registration DevelopmentPeriodDevelopmentLaunchGrowth &MaintenanceEarly evaluation &strategic planning32 16

9/25/2014Outcomes Research and the Product CycleInitial awareness,preliminary planningDiscoveryResearchOR StudyExecution Exploratory Full Registration Development Development PeriodLaunchGrowth &MaintenanceEarly evaluation &strategic planning33Outcomes Research and the Product CycleInitial awareness,preliminary planningDiscoveryResearch Exploratory FullOR StudyExecution Registration Development Development PeriodEarly evaluation &strategic planningLaunchGrowth &MaintenanceValue dossiers sent &RWD studies initiated34 17

9/25/2014Outcomes Research and the Product CycleInitial awareness,preliminary planningDiscoveryResearchOR StudyExecution Exploratory FullCountry studiesNew indications Registration Development Development PeriodLaunchGrowth &MaintenanceValue dossiers sent &RWD studies initiatedEarly evaluation &strategic planning35HEOR Evidence-Generating ToolsPre-launchPost-launch Early economic models for price-efficacy Phase 4 prospective studies with HEcomponents and/or analyses PRO instrument development and RCT use Burden of illness studies with real world data Registry and EMR design and analysis RCT-based HE analyses Comparative effectiveness research withreal-world data Full economic models (Cost-effectiveness/Budget Impact) Studies done in partnership with payers Indirect/mixed treatment comparisons DossiersCan be used in preparationfor P&R negotiations Employer studies/modelsandmore Can be used to supportpull-through, responses to newmarket issues, and P&R reviews36 18

9/25/2014Summary Pharmacoeconomics measures the “value for money” brought tosociety by drug treatments, drawing its methods from healtheconomics more broadly Patient benefits, including quality of life benefits, from treatment mustbe scientifically captured, both to properly assess value and to bettercommunicate treatment effects to patients and physicians Payers across the world are increasingly using pharmacoeconomicresults in their reimbursement decisions Pharmacoeconomic work is done during all parts of the drugdevelopment cycle and helps inform product development strategy37ACS WebinarIP Strategies in DrugDevelopmentPharmacoeconomics and IP Strategies in Drug DevelopmentSeptember 25, 2014Robert Koch 19

9/25/2014What You Will LearnI. IP Considerations in New Drug DevelopmentII. Most Important IP Policies Affecting New DrugDevelopmentIII. How IP Protection and Enforcement Decisions Are Made 39SECTION 1IP Considerations inNew DrugDevelopment 40 20

9/25/2014I. IP Considerations in New Drug Development Patents Trademarks Trade Dress Trade Secrets Copyrights 41SECTION 2Most Important IPPolicies Affecting NewDrug Development 42 21

9/25/2014II. Most Important IP Policies Affecting NewDrug Development IP Landscape U.S. Europe Asia R.O.W. Pharmacoeconomics Regulation U.S. Europe 43Audience Survey QuestionAre you familiar with patentenforcement under Hatch-Waxman? NoHeard of itSomewhat familiarVery familiar 44 22

9/25/2014SECTION 3How IP Protectionand EnforcementDecisions Are Made 45III. How IP Protection and EnforcementDecisions Are MadeA. InnovatorB. GenericsC. Biotechnology 46 23