C omparative Effectiveness: A Manufacturer’s Perspective AHRQ 2007 Annual Conference September 27,...

Comparative Effectiveness: A Manufacturer’s Perspective

AHRQ 2007 Annual ConferenceSeptember 27, 2007

Peter Juhn, MD, MPH

Vice PresidentEvidence and Regulatory Policy

Johnson & Johnson Corporate OfficeNew Brunswick, NJ

732-524-6484

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Evolving Environment

Cost

Quality/Safety

Value

DriversChallenges

• Coverage and Reimbursement

• Evidence Review

• Quality Measurement

• Insurance Benefit Design

• HIT – EMR, PHR, Data Mining

Activities

Comparative Effectiveness

Pay-for-Performance

Benefit-Risk Determination

Coverage with Evidence

DevelopmentAccess to and Payment forInnovative and

effective products

Policies

Practice Variation

Aging Population

Rising Demand

Cost of Technology

Budget Pressures

PatientsProviders

EmployerEmployer EmployerEmployer

PayerPayer PayerPayer

Pharmaceutical Pharmaceutical Manufacturers

Medical DevicesMedical Devices

IntegrateIntegratedd

Networks Networks

HospitalsHospitals

LTCLTCFacilitiesFacilities

OutpatientOutpatient

OtherOther

BiotecBiotechh

Distributor/Distributor/WholesalerWholesaler

RegulatoryRegulatoryAgencyAgency

Physicians Physicians

Payers/ Regulators

Healthcare Stakeholders

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators


Patient – “am I getting the best care?”

•Convenient

•Respectful/compassionate

•Trusted information about choices

•Lower out-of-pocket cost

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators

Healthcare StakeholdersProvider – “am I being rewarded for good work?”

•Better outcomes

•Higher reimbursement

•Increased volume

•More efficiency

•Chance to innovate

•Enhanced reputation

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators


Employer – “am I getting value for money?”

•Lower cost

•“Best care”

•Not unhappy beneficiaries/workforce

•Healthy productive employees

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators


Payer – “am I only paying for effective care?”

•Lower cost

•Predictability

•Better outcomes (influence on later costs)

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators


Regulator – “am I protecting the public health?”

•Safe and effective products

•Two types of challenges:

•Approving a drug later found to be dangerous

•Not approving a useful drug in a timely fashion

PatientsProviders






Networks Networks

HospitalsHospitals



OtherOther

BiotecBiotechh




Payers/ Regulators


Manufacturer – “am I being rewarded for safe and effective products?”

•Improved patient outcomes

•Recoup R&D investments

•Fair and transparent coverage process

•Clear evidence requirements

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Does it work? Is it safe? Regulatory Approval Relevant for covered population (i.e. Medicare over 65y)

When should it be used? Who will most benefit? Appropriateness guidelines Patient selection criteria

How does it compare? Is it definitively better? Earlier generation of technology Within same class of technology Rigor of comparative reviews

Key Questions about Products

What is the value? Can the value be captured? Is it cost-effective? Is it cost-saving? Is there an ROI? When? To Whom?

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Evidence Challenges

Availability of evidence Needs for evidence are increasing Large gaps in the existing literature Limited generalizability of trials data to real-world practice Unique challenges of devices

Distinguishing operator vs. product effects Short product life-cycles Feasibility of RCTs

Conclusions from the evidence Reconciling “average” population effects with individual

effects “Shelf-life” of evidence

Practical use of evidence Application of evidence to real-world medical decisions Provider “accountability” for using evidence

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The Promise of EBM

Properly developed and applied, evidence-based medicine can:

Stimulate the development of high quality information about treatments and devices

Enhance consistent and informed healthcare decision-making by physicians, patients, caregivers and payers

Support patient access to appropriate technologies Help establish the value of medicines, medical devices,

diagnostics and other health services Provide the basis for optimal use of health care resources Promote a more quality-focused and cost-effective

healthcare system that delivers superior patient outcomes

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The Perils of EBM

Potential for unintended consequences Justifies coverage decisions based purely on cost without

regard for overall effectiveness or value Freezes the pace of innovation to the current generation of

products Discriminates against new technologies Leads to prescriptive clinical protocols that do not allow for

physician judgment and consideration of patient preferences

Focuses too narrowly on clinical morbidity or mortality, ignoring a range of other important patient-reported outcomes (ease of use, compliance, functional status)

Changes to coverage policies occur haphazardly without clear rationale, transparency or accountability

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What is J&J’s position on comparative effectiveness? Help establish the value of treatments Promote a more quality-focused cost-effective health

system Help physicians and patients make better decisions Be a way for manufacturers to differentiate products However, it is not the “silver bullet” as it will not

automatically solve our cost and quality challenges How should information from CE research be used?

Should inform medical decisions, not replace medical judgment with treatment formulas

Will need to reconcile “average” population effects and with impacts on individuals that reflect differences in side effects, intolerance, noncompliance, and quality of life

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How should it be linked to coverage decisions by payers? Should not serve the cost containment concerns of payers Might be most useful in informing treatment options and

assigning appropriate reimbursement premiums How should this information be communicated?

Share widely with all stakeholders, particularly providers and patients

Consider the dangers of incomplete understanding of results, particularly when communicated in an overly simplistic manner

Acknowledge that CE information can be incomplete, misleading, or misinterpreted

How should stakeholders be involved? Participate in framing the methods that will be used and

prioritizing the key therapeutic areas Promote transparency about the processes, findings,

limitations, and appropriate uses of the information


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Definitions Comparison of “what to what”

Drug to drug; drug to procedure; disease management to not What will success look like – information output vs. impact on

care delivery Scope

Clinical decision dilemmas vs. population economics Synthesis of current evidence vs. initiating new comparative

research Funding

Commitment to conduct adequately powered studies Distance from payment authorities

Stakeholders Genuine involvement with priority setting, methods review and

communication approaches

A Few Suggestions

C omparative Effectiveness: A Manufacturer’s Perspective AHRQ 2007 Annual Conference September 27,...

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