Two countries divided by a common language?

groupH explored the different approaches and philosophies behind Market Research and Consulting from the perspective of individuals with a Market Research, Strategy Consulting and Pharma background through a short online survey.

Please find the results and insights and a graphic showing how the MR and Consulting value chain, capabilities, project types and underlying value driving philosophies relate to each other informed by the findings.

groupH Survey Feedback

Not if but how – Impressions from Market Access for Cell & Gene Therapies, 18-19th October, London

This new two-day conference allowed for honest discussions in small groups helped by the simple set-up and high-quality contributions from both payers and industry. Our head of market access, Nicolas Touchot chaired a keynote panel on Preferred Payment Models for cell and gene therapies. The news of Kite’s CAR-T US approval coming in at $373,000 additionally stimulated positive discussions on day two. There was goodwill and consensus on the payer/manufacturer objective to get to a ‘fair deal’ and the need for a ‘win-win’ BUT the ‘devil’ is in working out what exactly this means. Here are our impressions from the two days highlighting the enormous promise but also the enormous challenges still to overcome.

Managing investor and manufacturer uncertainty
Only the weight of future approvals and the underlying data on efficacy and safety of novel gene therapies will lead payers to seriously consider and eventually commit to new payment models and managed access schemes at country level. A ‘one size fits all’ model appears elusive but the iterative nature of this process will over time lead to greater certainty on reimbursement. This is helped by >70 late stage developments in the pipeline looking to gain access to patients. Investors and manufacturers won’t be holding their breath just yet however, there is no quick break-through anticipated. Assessing gene therapy treatments, often for unknown, rare diseases can be complex and time consuming. Manufacturers can help this process by offering comprehensive and well supported material with a clear rationale while, as much as possible, aligning all stakeholder data needs.

Risk pools or special funds?
There were no suggestions from payers that, in the short term at least, more healthcare budget will be put aside to serve the reimbursement of the anticipated wave of novel gene and cell therapy treatments. However, in single payer or even multi-payer systems, risk pools remain a possibility. Similar, in principle, to an improved UK cancer drug fund (CDF) or in multi-payer-systems an improved German Morbi-RSA (abolished 2009), to ring fence access to treatments bearing greater uncertainty than traditional medicines.

Are payers ready?
Highly cost-effective treatments can still bust current budgets and are therefore not necessarily affordable. Payers understand the challenges but are not close yet to proposing a universal method for reimbursement of treatments where the value is realised over time but remains uncertain. Currently, most payer budget cycle horizons are around two years and may stretch to three to five years at best. While the pace of coming up with new models seems sluggish, NICE put forward the possibility of ‘fleeting foot adjustments’ in some cases, whereby other cases e.g. orphan diseases with endpoints based on surrogate markers will take time to assess. In Germany, the ‘tools’ needed for managed access are not there yet either, 99% of existing contractual arrangements are simple rebate contracts, some with a cap. To allow for managed access the whole system will have to change.
Payers also have to learn about the meaningfulness of novel endpoints in many of the rare diseases put forward for treatment. This was illustrated recently by the FDA asking for an advisory committee’s opinion on the clinical meaningfulness of the MLMT endpoint seen with Luxturna (voretigene neparvovec) from Spark Therapeutics Inc. adding to the time taken for the approval and reimbursement process.
As this conference summary is being finalised, NICE has published its 31-page consultation document on Strimvelis, which reads relatively positive overall but also illustrates the complexity of analysis required prior to any gene therapy reimbursement decisions.

Managed Access Schemes

While managed access schemes seem the preferred way of payers, who are overall reluctant to deal with uncertainty, they are not a panacea. Payers in reality much prefer simple one-time payments avoiding having to follow a patient over time and collecting complex data. However, it was argued that mandatory patient registries paid for by the manufacturer as part of managed access may be attractive in addressing both managing uncertainty and fairness towards the manufacturers. The technical difficulties in successfully tracking patients over time presents a similar challenge in both the US and Europe.
Manufacturers claim that a ‘fair deal’ must allow not only for prices to go down or even disinvestment but also to go up if real world evidence supports a better price. This was verbally acknowledged by payers. The industry and their investors hope to see this being implemented in writing too in the near future.
Managed Access Pathways follow the context of regulatory Adaptive Pathways. These are attractive but it was acknowledged that there is much to learn over the coming years. This learning may involve payers listening to issues such as manufacturing complexity and manufacturers taking note of ‘wrap-around-costs’ or structural costs when a novel therapy changes the existing care infrastructure and requires investment in areas that add to the mere drug therapy.

Are manufacturers ready?
It will be the manufacturer’s responsibility to explore sufficiently what payers will pay for in different countries, the evidence needed to show this and to design their trials and data set accordingly. Assuming annuity payments can be agreed, manufacturers are likely to receive a certain amount per successfully treated patient over time from payers. Risks the manufacturer has to manage include incurring a potential loss during the early years or potential deductions from an annuity if a patient requires additional therapy if this has been agreed as part of a risk-sharing agreement.
Other manufacturer paid investment into real world evidence may include building registry infrastructure and managing those through intermediaries. Additionally, costs could arise in other areas, where payers feel that manufacturers should not only share a financial risk but also actively participate in setting up new treatment infrastructure and processes.

Conclusions
With more future approvals for rare and more common diseases anticipated, and no additional funds being added to the drug-budget, reimbursement will be driven even more by the quality of the data supporting payer value and the difference that a proposed treatment can make to the Quality of Life of a patient.
As one of the manufacturer delegates put it “The complexity of market access has surpassed the complexity of regulatory approval”.
Manufacturers recommend meeting with HTA bodies early and taking advantage of early consultation frameworks such as EUneHTA in order to both harmonise evidence requirements (while prioritising the more detailed national advice over higher level EU advice) and realising cost efficiencies between multiple stakeholders.
Furthermore, while starting with a smaller but high-value-adding indication for proof-of-concept, payer reluctance to indication or value-based pricing puts more emphasis on manufacturers getting their launch sequence right. ‘Ultrarare’ diseases with fewer than 100 patients per country remain a viability challenge for payers and manufacturers – commercially very difficult. On the other hand, assuming there are 6,000 rare diseases with an estimated prevalence of 0.5-1/100,000, adding them all up makes for 5% of the population – too many to be ignored.
To find out how groupH can help preparing for market access visit www.groupH.com, or contact nicolas.touchot@grouph.com or erik.holzinger@grouph.com.

 

Click here to download a copy of this Conference Summary in pdf format.

How accurate are long term sales forecasts?

This is indeed a question many people ask, or if not, should ask themselves.

With forecasts even at late-stage clinical development, and assuming the product is approved, launched and reimbursed, peak sales can be more than ten years into the future.

This does not naturally invite follow-up or analysis as people and organisations move on and data sets supporting the forecast may not be at hand anymore – thus, the question most often remains unanswered.

groupH turned onto itself in analysing its own forecasting track record, looking at a basket of 50 projects from as far back as 2003 to support transparency and learning as much as possible.

Let us take you through a quick eight minute audio summary by clicking the play button below or download the PDF for a more thorough read in your own time.

Does the EU price of Strimvelis create a new ‘glass ceiling’?

The recent announcement of the European authority’s pricing strategy for Strimvelis, the world’s second approved gene therapy, is in line with the predictions groupH made a year ago in “Nature Biotechnology” – but does Strimvelis prove our point or is it a one-off?

In our article, “The Payers’ perspective on gene therapies”, we suggested that setting the price of gene therapy on the basis of a high multiple of the cost of yearly enzyme replacement therapy was going to be difficult to achieve. We indicated that a realistic target was a multiplier of around 2.5 times the cost of annual treatment.

Strimvelis was priced in line with this multiplier at €594k, 2 times the annual cost of the current treatment of enzyme replacement therapy injections.  Other conditions were also attached to the reimbursement, including a money back guarantee and a payment-by-result mechanism. The payment-by-result could result in treatment being reimbursed by GSK in 1 patient out of 6. So, taking that into account, the effective price per patient could be lower at around €500K.

Given the high cost of the alternatives (bone marrow transplants and long-term enzyme injections), and the expectations that were set by Glybera’s price tag of €1.1m back in 2014, Strimvelis’s price may come in under what companies developing new gene therapies would hope for.

The price set now begs the question “does the EU price of Strimvelis create a new ‘glass ceiling’?”

For upcoming gene therapies, will payers in Italy and in other countries – especially the US – accept the circumstances surrounding Strimvelis’s price, and view it less as a reference point and more as an anomaly?

Strimvelis treats an ultra-rare disease, Severe Combined Immunodeficiency due to Adenosine Deaminase deficiency, estimated to affect just 15 patients per year in Europe. It was developed initially through charity money, and furthermore GSK may always have anticipated that it would be a loss maker given the extremely small patient population. This rarity is another reason for questioning its relevance in price setting going forward.

It is hoped that payers will take into account the special circumstances surrounding Strimvelis, and future gene therapies will be fairly recognized for the value created in their indication. Good data for each particular therapy will be required to establish its exact benefits, including longevity of efficacy.

We believe that groupH’s philosophy of needing to inform, engage and listen to all stakeholders early in the drug development process will continue to play a useful role in realizing the full potential value of these life-changing therapies.

Real World Pharma – Affordability vs. Cost Effectiveness. Impressions from 18th ISPOR in Milan

Attending ISPOR when keeping your ear to the ground in Market Access matters is non-negotiable. And this year was no exception. Noticeable to us was that many presentations and workshops revolved around two important and related concepts: affordability and uncertainty. Here is some background.

Affordability is very different from cost effectiveness. Cost effectiveness is often based on long-term models accruing savings over multiple years, while affordability depends on the short-term budget impact at time “t”.

This means that these days many therapies that are seen as cost effective might not actually be affordable for health systems. This is especially true for therapies that project to be curative, and therefore are priced very high compared to chronic treatments. Most have probably followed the controversy surrounding Sovaldi pricing in Hep C in recent years, as just one example of many.

This year uncertainty in assessing value was a particular hot topic. It is increasingly difficult for payers to assess the real value of therapies based on the data provided at the time of price negotiations. We see increasing splicing of the market with many products now approved rapidly on small studies. While it remains easy for payers to say “no” to coverage, in the case of positive decisions it is increasingly difficult to say “how much”. As a result, payers are looking for Adaptive Pathways including not only regulatory but also reimbursement and pricing decisions.

What does this mean? As part of this discussion, ISPOR participants also debated the topic of Coverage with Evidence Development (CED) vs. individual pay for performance.  The latter is perceived as difficult and costly to implement on a large scale. A CED approach allows for the identification of outstanding value uncertainties at the end of regulatory and to link coverage for the overall target population to answering of these questions. However, CED requires enforcing post-marketing evidence requirements, something which is poorly done at present.

To us the implication for the industry is to evolve payer evidence generation from a “hunter gatherer” approach to a planned and considered “farmer” approach where evidence targeted to answer payers’ questions can be produced quickly, regularly and with adaptability, or a combination of the two.

To find out how groupH is already assisting its customers with this in mind, please click on the links below;

How groupH can assist in developing Market Access strategies

Pharmaceutical forecasting: throwing darts or adding value?

Several clients have brought this review from McKinsey, the global management consultancy, to our attention over the last few weeks.  It’s prompted us to reflect on the forecasting we conduct with our clients and put down our opinions on the value of the forecasting process.  It also gives us the opportunity to listen to your opinions.

Throwing darts?

The article, in Nature Reviews Drug Discovery, reports on an in-depth piece of analysis into the accuracy of analyst’s drug forecasts.  These consensus forecasts were chosen for analysis as they represent the most complete data source available for looking at forecasts longitudinally and across a broad set of drugs.  The authors also argue that these forecasts are often relied upon by pharmaceutical companies and investors as the starting point for their own forecasts.

The principal finding is that most consensus forecasts are wrong – often substantially – and that accuracy remains an issue even several years post-launch.  Although it is not surprising that forecast accuracy is poor, the extent of the inaccuracy is particularly arresting.  One can only wonder what impact this has had on companies’ decision making.

Less about the number; more about thorough understanding and a simple, co-operative and iterative process.

At groupH, we have been helping our clients with their drug forecasting needs, and how this feeds into their decision making processes, for many years.  We recognise the limitations of the process and avoid at all costs the generation of falsely-precise forecasts.  We believe that the way to extract true value is to aim for a thorough understanding of the market and of the product – across the whole organisation – and create the ability to react and adapt to changes quickly and easily.  This generates an evolving, hopefully increasingly accurate, forecast range with which to feed into decision making.

Our view is to;

  1. Engage in in-depth scenario planning and competitor evaluations. E.g. What if;
    • Clinical data emerges that means our product will no longer be best in disease or best in class?
    • We don’t reach certain payer-orientated secondary end points? What happens to the value of our product?
    • A pipeline competitor’s clinical profile improves?
  2. Involve a cross-functional team, which meets regularly, to create a non-biased, consensus view across the organisation. Including;
    • Global Marketing/Business Insights.
    • Finance.
    • Regulatory.
    • Clinical.
    • Pricing/Market Access.
    • Marketing Companies/Country Affiliates.
  3. Model the forecast as simply as possible to;
    • Enable input from multiple users with minimum training requirements.
    • Create the ability to document and track assumptions transparently.
    • Refine the forecast rapidly when new information arises.

We know we’ll never be 100% accurate in our forecasting, but we aim to aid our clients in getting the most out of the process.

What are your thoughts and experiences?  We’d love to hear from you.

Want to Dig Deeper?

Pharmaceutical forecasting: throwing darts? M Cha, B Rifai and P Sarraf. Nature Reviews Drug Discovery. Vol 12.p737-8. October 2013.

Available to download at:

http://www.nature.com/nrd/journal/v12/n10/full/nrd4127.html

Further insightful commentary:

McKinsey Confirms Pharma Forecasts Fragile; Can Industry Learn To Survive Without Them (Forecasts, That Is)? D. Shaywitz. Forbes Pharma & Healthcare. October 2013.

Available to download at:

http://www.forbes.com/sites/davidshaywitz/2013/10/06/mckinsey-confirms-pharma-forecasts-fragile-can-industry-learn-to-survive-without-them-forecasts-that-is/

In defense of pharma forecasting. F. David.

Available to download at:

http://www.pharmagellan.com/in-defense-of-pharma-forecasting/

Will new developments change the treatment paradigm in RA?

A new era of targeted oral therapies?

Rheumatoid arthritis (RA) treatment options have expanded from conventional oral therapies like methotrexate, through the era of targeted injectable biologics and into a new dawn of targeted oral treatment.

Xeljanz, Pfizer’s first-in-class JAK3 inhibitor (tofacitinib), was launched in the US in 2012 – the first oral therapy approved for RA in over a decade. The drug has approval for second-line use. With similar efficacy to the injectable TNF-inhibitors, this means it’s well positioned to compete against them from a clinical and convenience perspective. But as with other disease-modifying antirheumatic drugs (DMARDs), Xeljanz is not without potentially serious side effects which will require close scrutiny and will leave many rheumatologists reticent to become early adopters. The high price of the treatment is also dampening enthusiasm. It is reportedly priced similarly to Abbott’s Humira, one of the top selling TNF-inhibitor monoclonal antibodies (mAbs). Japanese and European approval is currently being sought.

Other oral therapies are also in the pipeline, such as Lilly/Incyte’s baricitinib, AstraZeneca’s fostamatinib and Vertex’s VX-509.

Biosimilars on the horizon.

At the same time, the green light could soon be given to mAb biosimilars for the treatment of RA. Recently the EMA issued guidance on the development of biosimilar mAbs, which are larger and more complex than the biosimilars that are currently available in Europe (such as human growth hormone and erythropoietin). FDA draft guidelines outlining the regulatory pathway for biosimilars have finally been released too.

As the first biological therapies indicated for RA edge closer to patent expiry, it is not surprising to find that there is considerable activity in the development of these cheaper follow-on versions. Korean biopharmaceutical company Celltrion has been the first to submit an application. It is the first regulatory application for a biosimilar mAb – for any indication – in Europe. Its version of infliximab (Remicade) has been through extensive clinical trials and the outcome of this submission is imminent. The product has already been approved in Korea. Celltrion and several other manufacturers are developing other biosimilars for RA, including Boehringer Ingelheim’s version of rituximab (MabThera) which entered phase III development in 2012, and Fujifilm Kyowa Kirin Biologics biosimilar adalimumab (Humira).

Confidence in biosimilars is likely to be determined not only by stringent regulatory approval processes, but through real world experience with them. Rheumatolgists are only too aware that these agents are ‘similar’ and not ‘the same’ as the originals, since the complex manufacturing processes cannot be copied identically. No-one is expecting erosion of the biologic brands’ patient shares to anything like the extent seen with synthetic small molecule generic competition. However, safe and effective alternatives, at a price discount, will be tempting in this high cost market, and could help push the biologics more into first line therapy.

The future.

Will these diametrically opposite new developments fundamentally alter treatment in RA then? Will the treatment paradigm come full circle back to oral therapy – with convenience outweighing high pricing and payer restrictions? Or will we see the trend towards earlier, more aggressive treatment intensified with the availability of cheaper biosimilars?

What we do know is that in the treatment of chronic, severe disorders like RA, safety and efficacy will always remain top priority. These additional treatment options will be welcomed since there is high unmet need. However, the market will have to balance the views of rheumatologists wanting to slowly gain experience and trust of newcomers – whatever their shape, size and mode of administration – with the increasing needs of payers to manage costs and improve patient access to effective medicines.

Since potentially similar scenarios will begin to play out in other fields, notably oncology, the RA market will certainly be an interesting one to watch and learn from over the coming years.

Update July 2013

  • Xeljanz is now approved in Japan and in other strategic markets, although approval in Europe has been initially rejected.  Pfizer has requested a re-examination by the European Medicines Agency.
  • AZ have returned rights to fostamatinib back to Rigel after disappointing PIII results.
  • Celltrion’s infliximab biosimilar has been approved in Europe.  It will be marketed as Remsina by Celltrion, and Inflectra by Hospira.

Want to Dig Deeper?

A New Chapter in Rheumatoid Arthritis Therapeutics. R Van Vollenhoven.  Medscape Rheumatology. Feb 2013.

The role of biosimilars in the treatment of rheumatic diseases. T. Dorner et al. Ann Rheum Dis 72. p322–328. 2013.

Biosimilar monoclonal antibodies on the horizon in Europe. GaBI online. Jan 2013.

U.S. Prepares Groundwork For Biosimilar Approvals. Clinical Oncology News 7. May 2012.

Fresh approaches to visualising information

Here at groupH, we are always looking for new ways to present information, data and concepts more cleanly and more concisely.

We have found the following websites inspiring, and hope you do too:

Beautiful:

http://www.informationisbeautiful.net/tag/health/

Informative: (The Economist’s daily chart)

http://www.economist.com/blogs/graphicdetail

Scientific and Statistical:

http://www.datavis.ca/gallery/bright-ideas.php

Tools:

http://www.idea.org/blog/2012/10/25/great-tools-for-data-visualization/

Newcomers entering the anti-obesity market bring optimism, but face tough challenges

Favourable market conditions.

The anti-obesity market is predicted to be worth $2.4 billion by 2021, growing 21% annually. High unmet need and advantageous epidemiological trends are key drivers. At first glance, the opportunity for new therapies seems considerable.

Limited success for Pharma so far.

For decades drug developers have had limited success in grabbing this opportunity. Many factors have contributed to the lacklustre performance of drugs that have made it to market so far.

Mediocre efficacy and lack of reimbursement.

There are many pathways involved in robustly ensuring energy homeostasis. Target one pathway, and others take up the slack. This helps explain the modest weight loss attributable to previous monotherapies. Targeting multiple pathways could be the way forward. But a shift towards polytherapy is challenging from a payer perspective. There’s already reluctance to reimburse long-term treatment for this sizeable patient pool, despite growing recognition of the high costs of treating obesity’s co-morbidities.

Safety issues raise the regulatory bar.

Then of course there are the side effects and serious safety issues. Think fen-phen in the early 1990s. Of the three drugs of the late 90s and early 2000s, only orlistat, with its unpleasant GI side effects, remains available. Sibutramine was withdrawn in 2010. Rimonabant never made it to the US market, and survived only two years in the EU. The regulatory bar is now far higher. Some view it as too high, querying the FDA’s risk/benefit calculations and lobbying for clarity of the regulatory pathway. No wonder Big Pharma took a step back from this increasingly uncertain arena.

Newcomers are welcomed, but are not magic bullets.

More recently biotech companies have taken up the challenge. The latest trio of treatments in the US to seek approval have moderate efficacy, and are beset with safety issues too. Not surprisingly all were initially rejected by the FDA. There are also market access issues. Two are combinations of off-patent medicines (Qsymia and Contrave). Limited insurance coverage for lifestyle diseases may see these losing out to the option of treating with two cheap generics rather than an expensive combination pill. In addition, Qsymia’s approval in 2012 came with the requirement of a Risk Evaluation and Mitigation Strategy, primarily over birth defect concerns, and its distribution is restricted to mail order. Belviq, an NCE monotherapy, approved around the same time, will probably be classified as a controlled substance. For Contrave, approval has yet to be given. CV safety trials are ongoing for all three.

Clinical optimism, but affordability pessimism.

It remains to be seen how successful these newcomers will be. They bring with them a new sense of optimism from a clinical perspective, and will pave the way for others in late-stage development. In particular the GLP-1 agonist liraglutide, which is already approved at a lower dose for type II diabetes. For the foreseeable future however, the key question of “who will pay?” will continue to be answered in the main by “affluent patients”. Public payers will remain extremely unwilling to fund treatment, for what many regard as a lifestyle disease, in all but those at the highest risk. This will continue to prevent obesity treatments gaining their full market potential.

Want to Dig Deeper?

The pharmaceutical market for obesity therapies. G. Heap et al. Nature Reviews Drug Discovery 11, p669-670, 2012

FDA Approval of Obesity Drugs. A Difference in Risk-Benefit Perceptions. E. Morrato & D. Allison. JAMA 308. p1097-1098, 2012

One way we are aiming to create shared value

Each year, at Christmas time, we donate a proportion of our operating profit to our two chosen charities.

The decision to support charities was taken at the very outset of the formation of groupH.  It’s simply something that we feel is the right thing to do, not just something to put in our Corporate Social Responsibility Document.

In fact, we’re of the opinion that CSR needs to be redefined, particularly as to what it means in terms of impact on local communities – of course a challenge for a global virtually organised company.

We very much agree with Harvard Business School Professor Michael Porter’s concept of Creating Shared Value.

Internationally renowned business thinker Professor Porter has raised a challenge to the modern model of capitalism. He believes that the disconnect between business and capitalism and society has grown.

“There’s been this shorter term view of how to create profitability and there’s also been this narrowing of what the responsibility of the company is” says Porter in an interview on BBC’s Global Business programme. With this disconnect has come a growing distrust in business, that CSR is failing to address in Porter’s view.

CSV is much more of a fundamental concept than CSR he explains.

“It’s not about doing stuff on the periphery. It’s not about supporting social causes. It’s not about philanthropic giving. It’s not about volunteer programs on the margin. It’s about re-examining your business itself from the perspective of trying to create profit in a way that actually meets social needs.”

The professor concludes that the competitiveness of a company and the health of the communities around it are mutually dependent, and that by focusing on what connects economic and societal progress, we can move towards a new phase of global growth.

At groupH, the idea of connectedness has always resonated with us.  We are all connected in more than one way to our colleagues, clients and the communities we work in.

Our Corporate Responsibility Statement is the synthesis of personal mission statements from each member of the groupH core team. Our CSR is therefore a unique statement, one of shared values, specific to who we are and what we do as an organisation. It reflects our culture of shared values, how we assemble project teams, how we function within groupH, how we conduct our business, and our impact on society and the environment.  It does not just define and drive what we do, but also reflects who we are and why we work together under groupH.

Our business does not exist only for its own sake.  It seeks to look for ways to help reduce disease impact and burden on individuals and society.  We support selected local charities with a percentage of our profits on an annual basis.  We wanted our choice of charities to reflect this, and continue to find ways to further embrace CSV.

Want to Dig Deeper?

groupH Corporate Responsibility

About Us: Our Values

Creating Shared Value

http://www.bbc.co.uk/iplayer/episode/p00clcns/Global_Business_Professor_Michael_Porter/