Mark Trusheim, MS, BS, strategic director at the NEW Drug Development ParadIGmS program and visiting scientist at Massachusetts Institute of Technology, explains factors involved when considering whether a therapy would be suitable for performance-based contracting.
At a recent ISPOR Payer Summit, performance-based contracting was most likely considered for products high in cost and value, as well as those with high uncertainty, such as cell and gene therapies, said Mark Trusheim, MS, BS.
Trusheim will be moderating the discussion, "Findings from the Payer Summit – Managed Entry Agreements" at Virtual ISPOR 2021 that will address findings of the recent Payer Summit.
What is being done to distinguish the therapies that are most suitable to performance-based contracts and managed care entry agreements?
So, the Payer Summit that ISPOR held a month or two ago is the subject of this panel. And at the Summit, we brought together around 50 international and US-based payers, as well as drug developers and a number of other stakeholders.
I was fortunate to be the facilitator of that. I’m Mark Trusheim from MIT NEWDIGS, in case you didn’t know me right away. At that event, we talked about performance-based contracting and which types of products would fit best. The consensus came out, perhaps not unexpectedly, that it's high-priced products that also have a high value proposition associated with them. So, high potential patient effectiveness, but also high uncertainty associated with those products. Product types that come to mind are cell and gene therapies that generally have small clinical trials, other orphan drugs that might be uncertain, some cancer therapies that similarly have perhaps transformational cancer efficacy but also have smaller trials and are for higher uncertainty going forward.
Those are the types of products, and for some, it's the price themselves, and others, it's the total budget impact. So, it may not simply be an orphan therapy, but hark back to some of the other products—such as the hepatitis C products, which didn't have a lot of uncertainty about their benefits, but certainly had very high value to patients, as well as high budget impact.
So, it doesn't only have to be a highly uncertain product of effectiveness through this. That was that combination of features, particularly on the word cloud, which came to me out of the Summit. You'll see my head is blocking the word uncertainty. And that was really the main thrust, I would say.