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Disinvestment and Value-Based Purchasing Strategies for Pharmaceuticals: An International Review

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Listed:
  • Bonny Parkinson
  • Catherine Sermet
  • Fiona Clement
  • Steffan Crausaz
  • Brian Godman
  • Sarah Garner
  • Moni Choudhury
  • Sallie-Anne Pearson
  • Rosalie Viney
  • Ruth Lopert
  • Adam Elshaug

Abstract

Pharmaceutical expenditure has increased rapidly across many Organisation for Economic Cooperation and Development (OECD) countries over the past three decades. This growth is an increasing concern for governments and other third-party payers seeking to provide equitable and comprehensive healthcare within sustainable budgets. In order to create headroom for increasing utilisation, and to fund new high-cost therapies, there is an active push to ‘disinvest’ from low-value drugs. The aim of this article is to review how reimbursement policy decision makers have sought to partially or completely disinvest from drugs in a range of OECD countries (UK, France, Canada, Australia and New Zealand) where they are publicly funded or subsidised. We employed a systematic literature search strategy and the incorporation of grey literature known to the authorship team. We canvass key policy instruments from each country to outline key approaches to the identification of candidate drugs for disinvestment assessment (passive approaches vs. more active approaches); methods of disinvestment and value-based purchasing (de-listing, restricting treatment, price or reimbursement rate reductions, encouraging generic prescribing); lessons learnt from the various approaches; the potential role of coverage with evidence development; and the need for careful stakeholder management. Dedicated sections are provided with detailed coverage of policy approaches (with drug examples) from each country. Historically, countries have relied on ‘passive disinvestment’; however, due to (1) the availability of new cost-effectiveness evidence, or (2) ‘leakage’ in drug utilisation, or (3) market failure in terms of price competition, there is an increasing focus towards ‘active disinvestment’. Isolating low-value drugs that would create headroom for innovative new products to enter the market is also motivating disinvestment efforts by multiple parties, including industry. Historically, disinvestment has mainly taken the form of price reductions, especially when market failures are perceived to exist, and restricting treatment to subpopulations, particularly when a drug is no longer considered value for money. There is considerable experimentation internationally in mechanisms for disinvestment and the opportunity for countries to learn from each other. Ongoing evaluation of disinvestment strategies is essential, and ought to be reported in the peer-reviewed literature. Copyright Springer International Publishing Switzerland 2015

Suggested Citation

  • Bonny Parkinson & Catherine Sermet & Fiona Clement & Steffan Crausaz & Brian Godman & Sarah Garner & Moni Choudhury & Sallie-Anne Pearson & Rosalie Viney & Ruth Lopert & Adam Elshaug, 2015. "Disinvestment and Value-Based Purchasing Strategies for Pharmaceuticals: An International Review," PharmacoEconomics, Springer, vol. 33(9), pages 905-924, September.
  • Handle: RePEc:spr:pharme:v:33:y:2015:i:9:p:905-924
    DOI: 10.1007/s40273-015-0293-8
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    References listed on IDEAS

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    1. Andreas Seiter, 2010. "A Practical Approach to Pharmaceutical Policy," World Bank Publications - Books, The World Bank Group, number 2468, December.
    2. Pichetti, Sylvain & Sorasith, Christine & Sermet, Catherine, 2011. "Analysis of the impact of removing mucolytics and expectorants from the list of reimbursable drugs on prescription rates: A time-series analysis for France 1998–2010," Health Policy, Elsevier, vol. 102(2), pages 159-169.
    3. Vitry, Agnes & Roughead, Elizabeth, 2014. "Managed entry agreements for pharmaceuticals in Australia," Health Policy, Elsevier, vol. 117(3), pages 345-352.
    4. Carlson, Josh J. & Sullivan, Sean D. & Garrison, Louis P. & Neumann, Peter J. & Veenstra, David L., 2010. "Linking payment to health outcomes: A taxonomy and examination of performance-based reimbursement schemes between healthcare payers and manufacturers," Health Policy, Elsevier, vol. 96(3), pages 179-190, August.
    5. Sylvain Pichetti & Catherine Sermet & Brian Godman & Stephen Campbell & Lars Gustafsson, 2013. "Multilevel Analysis of the Influence of Patients’ and General Practitioners’ Characteristics on Patented Versus Multiple-Sourced Statin Prescribing in France," Applied Health Economics and Health Policy, Springer, vol. 11(3), pages 205-218, June.
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    1. Craig Mitton & Brayan V. Seixas & Stuart Peacock & Michael Burgess & Stirling Bryan, 2019. "Health Technology Assessment as Part of a Broader Process for Priority Setting and Resource Allocation," Applied Health Economics and Health Policy, Springer, vol. 17(5), pages 573-576, October.
    2. Lei Chen & Ying Yang & Mi Luo & Borui Hu & Shicheng Yin & Zongfu Mao, 2020. "The Impacts of National Centralized Drug Procurement Policy on Drug Utilization and Drug Expenditures: The Case of Shenzhen, China," IJERPH, MDPI, vol. 17(24), pages 1-11, December.
    3. Sabine Vogler & Valérie Paris & Alessandra Ferrario & Veronika J. Wirtz & Kees Joncheere & Peter Schneider & Hanne Bak Pedersen & Guillaume Dedet & Zaheer-Ud-Din Babar, 2017. "How Can Pricing and Reimbursement Policies Improve Affordable Access to Medicines? Lessons Learned from European Countries," Applied Health Economics and Health Policy, Springer, vol. 15(3), pages 307-321, June.
    4. Hofmann, Bjørn, 2020. "Biases distorting priority setting," Health Policy, Elsevier, vol. 124(1), pages 52-60.
    5. Angelo Claudio Palozzo & Andrea Messori, 2016. "Comment on: “Disinvestment and Value-Based Purchasing Strategies for Pharmaceuticals: An International Review”," PharmacoEconomics, Springer, vol. 34(4), pages 419-420, April.
    6. Viviane Cássia Pereira & Jorge Otávio Maia Barreto & Francisco Assis da Rocha Neves, 2019. "Health technology reassessment in the Brazilian public health system: Analysis of the current status," PLOS ONE, Public Library of Science, vol. 14(7), pages 1-18, July.
    7. Peter Ghijben & Yuanyuan Gu & Emily Lancsar & Silva Zavarsek, 2018. "Revealed and Stated Preferences of Decision Makers for Priority Setting in Health Technology Assessment: A Systematic Review," PharmacoEconomics, Springer, vol. 36(3), pages 323-340, March.
    8. Rotteveel, A.H. & Reckers-Droog, V.T. & Lambooij, M.S. & de Wit, G.A. & van Exel, N.J.A., 2021. "Societal views in the Netherlands on active disinvestment of publicly funded healthcare interventions," Social Science & Medicine, Elsevier, vol. 272(C).
    9. Hye-Young Kwon & Brian Godman, 2017. "Drug Pricing in South Korea," Applied Health Economics and Health Policy, Springer, vol. 15(4), pages 447-453, August.
    10. Peter Ghijben & Dennis Petrie & Silva Zavarsek & Gang Chen & Emily Lancsar, 2021. "Healthcare Funding Decisions and Real-World Benefits: Reducing Bias by Matching Untreated Patients," PharmacoEconomics, Springer, vol. 39(7), pages 741-756, July.
    11. Livia Lovato Pires de Lemos & Augusto Afonso Guerra Júnior & Marisa Santos & Carlos Magliano & Isabela Diniz & Kathiaja Souza & Ramon Gonçalves Pereira & Juliana Alvares & Brian Godman & Marion Bennie, 2018. "The Assessment for Disinvestment of Intramuscular Interferon Beta for Relapsing-Remitting Multiple Sclerosis in Brazil," PharmacoEconomics, Springer, vol. 36(2), pages 161-173, February.
    12. Karin Dam Petersen & Gang Chen & Christine Mpundu-Kaambwa & Katherine Stevens & John Brazier & Julie Ratcliffe, 2018. "Measuring Health-Related Quality of Life in Adolescent Populations: An Empirical Comparison of the CHU9D and the PedsQLTM 4.0 Short Form 15," The Patient: Patient-Centered Outcomes Research, Springer;International Academy of Health Preference Research, vol. 11(1), pages 29-37, February.
    13. Sabine Vogler & Peter Schneider & Nina Zimmermann, 2019. "Evolution of Average European Medicine Prices: Implications for the Methodology of External Price Referencing," PharmacoEconomics - Open, Springer, vol. 3(3), pages 303-309, September.
    14. Livio Garattini & Alessandro Curto, 2016. "Performance-Based Agreements in Italy: ‘Trendy Outcomes’ or Mere Illusions?," PharmacoEconomics, Springer, vol. 34(10), pages 967-969, October.

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