Pharmaceutical reimbursement in Sweden Balancing benefits and costs. Andreas Engström Health Economist Dental and Pharmaceutical Benefits Agency

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1 Pharmaceutical reimbursement in Sweden Balancing benefits and costs Andreas Engström Health Economist Dental and Pharmaceutical Benefits Agency 1

2 Agenda Background - Healthcare in Sweden - Pharmaceutical reimbursement - Agencies involved in HTA The Dental and Pharmaceutical Benefits Agency Evaluating drugs for reimbursement - Assessment procedure - Decision criteria Innovation - Stimulating innovation? 2

3 Healthcare organization 21 regions responsible for all healthcare - Regions tax the inhabitants - But also transfers from national government Healthcare is regulated both through law and through decisions and guidelines from government agencies 3

4 Financing of pharmaceuticals Prescription drugs - Paid by the regions - Government grant to the regions - Patient co-payment (maximum 200 per year) Hospital drugs - Paid by the regions 4

5 Drug expenditure 5

6 Generic substitution Mandatory generic substitution at the pharmacy since 2002 A sharp drop in generic prices resulting in large savings 6

7 Patented Generics Total

8 Agencies in the area of medicine SBU Swedish Council on Technology Assessment in Healthcare - Assess healthcare technology Mdi Medical lproducts Agency - Marketing authorization of drugs - Surveillance and regulation National Board of Health and Welfare - Treatment guidelines Dental and Pharmaceutical Benefits Agency (TLV) - Reimbursement decisions for pharmaceuticals and dental benefits 8

9 The Dental and Pharmaceutical Benefits Agency Our goal is to get the maximum amount of health out of the taxpayers money spent on pharmaceuticals and dental care Independent government agency Established in 2002 Currently 45 employees 9

10 Pharmaceuticals Reimbursement decisions for new drugs Reimbursement review of older products To assess if the existing range of products are cost-effective 10

11 Reimbursement decision process Reimbursement application from company TLV Assessment Team health economist, pharmacist, legal officer TLV Board Decision (Yes/No) Price Effect documentation Health economics Evaluation Contact w/company - questions - additional analyses 11 members - medicine - health economics -users Prepare a memo to the board with proposal for decision Deliberation w/company Max 180 days Average 91 11

12 Effect Estimated value Good/Moderate/ Uncertainty Bad Great/Medium/Small Cost Estimated value Uncertainty Cost per effect Uncertainty Estimated value Low/Medium/High/ Great/Medium/Small Very highh Number Great/Medium/Small Evaluation Degree of Severity Estimated value High/ Medium/ Low Uncertainty Great/Medium/ Small 12

13 Decision making criteria Human value -respect for equality Need and solidarity - those in greatest need take precedence Cost-effectiveness - from a societal perspective 13

14 Need Disease Severity The disease -Symtoms - Ability to function - Quality of life - Risk of premature death - Risk of permanent disease/injury - Risk of worsened quality of life incl. decreased d autonomy Estimated severity of the disease - High/Medium/Low with - Great/Medium/Small uncertainty 14

15 Health Economics Focus on cost-effectiveness from a societal perspective (Cost/QALY) Comparison with most relevant comparator (not necessarily a drug) The type and scope of the analysis can vary Guidelines es on health economic o c evaluations similar to many other countries 15

16 Restrictions ti and conditional reimbursement Is a restriction needed? - Would it contribute to a more cost-effective use of the medicine? - Disease dependent Would it work in everyday clinical practice? - Is it possible to clearly define a patient group? - Will the restriction be understood/accepted? Are conditions needed? - Requests for additional data - Improved information within a reasonable amount of time? 16

17 How do we know we are getting value for money? Limited knowledge about effect and costs at the point of decision - a few clinical trials - costs and some effects have to be modelled - tempting to postpone the decision but - even waiting is a decision in itself with costs and effects 17

18 How do we know we are getting value for money? There is a need of evaluating the real life costs and effects of therapies This is not restricted t to us as the reimbursement body. The healthcare system itself also has a need to know what works and what does not. TLV has in a number of decisions required companies to submit additional information on both clinical i leffects, real world use and costeffectiveness data 18

19 Reimbursement and incentives for innovation Incentives for innovation are important but jobs in the pharma industry are not a decision criteria Discussions within the European Commission on how to define innovation We believe that by requiring drugs to show an additional benefit if they are to have a premium price we send a signal 19

20 Incentives in the healthcare system There are conflicts within the system. - Reimbursement decisions do not take budget timpact into account - But for the regions there is still a limited budget Thus drugs that are cost-effective on a societal level may not be used as widely as they should 20

21 Questions Thank you for your attention 21

22 Extra slides 22

23 Examples of decisions 23

24 Yes Prezista (darunavir) for HIV A new protease inhibitor (PI) for use in patients who have failed on at least one PI-regimen More expensive than other PIs The health economic analysis showed that the cost per QALY was fairly low (~ ) compared to relevant comparators - High severity of disease with a need for more treatment options Approved for reimbursement for the given indication. If a new indication is approved the company must apply again. 24

25 No Procoralan (ivabradin) for angina Indicated for use when beta-blockers not appropriate. But calcium channel blockers are cheaper Health Economic comparison as last line vs. Surgery Procoralan was cheaper than surgery but also less effective The cost savings per QALY lost were not considered large enough. 25

26 Restricted Champix (vareniclin) for smoking cessation Health economic model shows cost-effectiveness compared to bupropion Reimbursed if given in combination with motivational support and as a second dline treatment The company shall provide information showing this by 2010 Inform of the restrictions in their marketing 26

27 27

28 End 28

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