Improving the evidence base relating payments for new branded pharmaceuticals to innovation and assessing the implications for pharmaceutical pricing policy
Theme 1: Empirical and conceptual work relating to medicines pricing
During EEPRU II we undertook work to assess the share of value of new branded medicines that accrues to manufacturers and NHS patients (published here) and what the appropriate share of value to assign to manufacturers would be under different policy objectives (described in detail here and summarised here).
The appropriate share of value was assessed using a model that accounted for the effects of payment on innovation and therefore future health, and also the health opportunity costs associated with different payment levels. As part of this research we undertook a systematic review to identify relevant empirical literature quantifying the relationship between payment levels for new pharmaceuticals and the number and quality of new drugs developed. This identified a number of studies examining the causal links between payment and innovation. This evidence was used within the model to estimate the optimal share of the long-term value of new pharmaceuticals that should be assigned to manufacturers to fulfil different policy objectives.
This project seeks to build on this work in two important ways. Firstly, we seek to address gaps in the underlying evidence relating payment to innovation to provide more robust estimates of the optimal share of value to allocate to manufacturers. Secondly, we seek to improve estimates of the share of value allocated to manufacturers under existing policies and explore the implications of different policies that could be used to modulate how value is shared.
Aims
To quantify the relationship between payment for new pharmaceuticals and innovation quantity, quality and cost of production
To assess the implications of the improved evidence base developed via aim (1) for the share of value to assign to manufacturers under different policy objectives
To assess the implications of different pharmaceutical pricing policy approaches for value sharing using a range of case study products
Project Team
Karl Claxton, Beth Woods, Francesco Longo, Andrea Salas Ortiz, Carlos Rojas Roque
Contact
Karl Claxton karl.claxton@york.ac.uk