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Data technology and value-based pricing

The value of adding post-approval data collating, monitoring and analysis to any discussion on drug pricing systems

healthcare data technology 

At present, there is understandable concern among many in the pharma industry about the introduction of a value-based pricing (VBP) system of drug reimbursement in the UK.

VBP is intended to replace the current PPRS method to determine the cost of a drug in the UK in 2014, taking into account the wider societal benefit, extended cost savings and the medical value of a drug to different patients.

The plans are currently under discussion between the Department of Health and the Association of the British Pharmaceutical Industry (ABPI), but what's clear to all stakeholders is that if the new system is to succeed, the healthcare industry going to need comprehensive, properly collected, well-analysed data like never before.  

If we are going to judge a drug not just on sheer efficacy but on value-added concerns such as compliance, before its price can even be set, then we need to know more hard facts about its use after license and approval - figures and statistics never collated previously.

Pharma has always been good at collecting data, of course - where would we be without the gold standards of clinical trials research? But, until now, that is where its buck has traditionally stopped.

Meanwhile, most consultants will know - through experience - what drugs patients  take to make them well, and genuinely improve quality of life. They know too what drugs patients find manageable - and which just don't seem to be worthwhile. But while these doctors may discuss their findings with colleagues, there has never been an empirical need to measure and record this data, so no system exists to make this happen.

How to square the circle?  Technology will be the key. Collecting data the right way can have a real impact on patient behaviour, adherence, medical solutions and ultimately on patients' health.

Insurance and home healthcare companies experienced at handling large amounts of sensitive data – are beginning to understand the importance of measuring how well a programme is doing - not just in terms of efficacy and economy but also customer and staff satisfaction.

Some companies are already putting programmes into practice, such as one pharma firm's decision to use a patient management and monitoring system that is used in conjunction with a drug regime for hepatitis C. The pharma company knows that the medicine works - it can cure this disease - but it must be taken consistently and precisely; compliance is a huge issue.

Yet, if the patient is unable to keep to the regime (which means taking a variety of drugs at specific times daily), then they cannot come back for a second attempt. Once stopped, the drug cannot be repeated as it would simply not work. So if this regime is to be useful, and to be rolled out across more patients globally, clinicians need to know why and when compliance becomes an issue, and how they can help.

Software systems are important in connecting up the health care economy (pharma, clinicians and patients) and help the patients along their journey with specific drugs, helping to identify the hotspots - those moments when a patient may slip in their routine. Their doctor can analyse those points and step in with more support are vital in making payment by performance really work.

You can see that these types of systems don't just favour the patient and consultant. The company behind the drug will see its product used more widely as the data and health outcomes information can be applied to make their invention truly user-friendly.  

With the planned introduction of VBP, companies have the chance to collate this type of meaningful data and offer it with the clinical trials results before pricing conversations at the Department of Health to offer a more robust defence of the value they place on their drug and its cost in R&D.

Use of monitoring and tracking technology is fundamental to proving that non-generic modern medicines are going to be worth paying a fair price for. It's in the interest of pharma to monitor their products after licence and approval, and companies are well-placed to create the infrastructure to do so.

They can helped in their work by existing technology companies, but ultimately decisions over standards and framework will come from conversations between the Department of Health and pharma companies.

The outcome will be crucial going into 2014 as it's in all our interests to monitor the patient's care pathway - whatever the illness, whatever the medication. One day, we might be on that journey ourselves.

Article by
Mindy Daeschner

Director at psHEALTH, a provider of IT solutions fo health and insurance. Email

3rd October 2013

From: Sales, Marketing



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