Medicare needs authority to negotiate drug prices to support its value-based healthcare strategy
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Despite majority public support for authorizing Medicare to negotiate drug prices, legislators struggle to reverse the non-interference clause that makes it illegal.
The non-interference clause
Medicare is legally prohibited from negotiating drug prices directly with manufacturers thanks to the non-interference clause in the 2003 law that created Part D, the prescription drug program for Medicare beneficiaries. The non-interference clause disallows Medicare from negotiating drug prices directly with pharmaceutical manufacturers, interfering in negotiations by Medicare contractors, or publishing any information about negotiated drug rebates.
Instead, the private health insurance plans and prescription drug programs Medicare contracts to implement benefits conduct negotiations for discounts with drug manufacturers. Meanwhile, other government programs — Medicaid and the Veterans Administration—have successfully lowered drug costs by negotiating directly for discounted drug prices and rebates.
Strong public support stands for allowing Medicare to negotiate drug prices
According to a KFF (Kaiser Family Foundation) poll published in October 2021, there is broad-based public support for ending the non-interference clause. The poll showed that 83% of the survey participants favored allowing Medicare to negotiate drug prices directly with manufacturers. Those in favor included a mix of 71% Republican, 82% of independents, and 95% Democrats.
Proponents of allowing Medicare to negotiate drug prices in Parts B and D see Medicare’s ability to negotiate value-based drug pricing as an important part of the overall strategy for driving the U.S. health system towards value-based healthcare and lower drug prices, especially if the outcomes of the negotiations are made known to commercial insurance plans, the Marketplace, and self-insured employers.
Opponents believe that the Medicare system of price negotiations through contracted health plans and prescription drug plans promotes competition among drug manufacturers and protects patient access to drugs. They also cite a Congressional Budget Office (CBO) letter that states giving broad Medicare negotiating authority to the Secretary of Health and Human Services (HHS) would, by itself, “likely have a negligible effect on federal spending”.
Recent legislative actions attempting to eliminate the non-interference clause
In 2019, the U.S. House of Representatives passed bill H.R.3, The Elijah E. Cummings Lower Drug Costs Now Act. Among other proposed fixes, the bill would authorize the Health and Human Services (HHS) Secretary to negotiate prices for single-source, brand-name drugs that met certain criteria. When H.R.3 went to the Senate for approval, its progress stalled. In 2021, H.R.3 was reintroduced in Congress.
In November 2021, the the Build Back Better Act (BBBA) passed the U.S. House of Representatives but was also stopped dead in the Senate. Within that bill was an exemption to the non-interference clause to allow Medicare to negotiate prices for expensive drugs covered under Medicare Parts B and D. Despite the defeat of the BBBA, President Biden used his State of the Union address on March 1, 2022 to keep up the pressure and repeated his call to lawmakers to address the problem of drug pricing.
Value-based administrative levers
In 2016 a pilot project for Medicare Part B drugs was created to test the results of allowing Medicare to conduct drug pricing negotiations. It was designed to institute value-based drug pricing using an international pricing index for the few drugs covered under Part B. The prices of some Part B biologics and single-source drugs were tied to their lower average overseas price.
Although the pilot project could have been implemented without congressional approval, several lawsuits and injunctions prevented the implementation of the model. Finally, the Biden administration rescinded the proposed model in August 2021.
Besides the recent unsuccessful legislative efforts for Medicare drug price negotiations, HHS outlined some other possible administrative actions for drug pricing reforms based on President Biden’s September 2021 Executive Order 14036, Promoting Competition in the American Economy. Among the proposals suggested is the use of value-based pricing models:
• To improve transparency about pricing, rebates, and out-of-pocket spending through data collection from health insurers and pharmacy benefit managers
• Implementing Medicare total cost of care models to find ways to reduce spending, affect drug utilization, and improve patient outcomes
The need for drug pricing reforms in Medicare holds bipartisan support, especially as it relates to lowering out-of-pocket expenses for seniors. However, passing the legislation needed to realize those reforms remains a controversial and complicated matter. While work continues to pass drug price reform legislation, value-based payment models can provide data analytics to support drug price reductions in both the public and private sectors.
Lyfegen’s value-based contracting platform
The Lyfegen platform helps organizations join in the healthcare industry’s movement towards value-based care. Our contracting platform organizes the actionable, real-time data needed to implement value-based contracting while relieving the complexity and administrative burden of transitioning out of fee-for-service models.
Contact us for more information about our software solutions and to book a demo.
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With passage of the Inflation Reduction Act, the Medicare Part D (outpatient drug benefit) will be undergoing a comprehensive redesign, which will be implemented in 2025. There will be a dramatic shift towards payer responsibility of costs, particularly in the catastrophic phase of the Medicare Part D benefit.
Currently, during the calendar year there are four phases a Medicare beneficiary goes through when obtaining coverage of outpatient drugs: Deductible, initial coverage, coverage gap, and catastrophic. Here, catastrophic refers to the point when a beneficiary’s total prescription drug costs for a calendar year have reached a set maximum level. At present, the catastrophic threshold is set at $7,100. In a given year, once beneficiaries hit the threshold they will have spent $3,250 out of pocket, at which point they begin paying 5% co-insurance in the catastrophic phase.
Over a five-year period from 2016 to 2021, nearly three million enrollees in Medicare Part D spent above the catastrophic threshold at least once. And, currently more than 1.5 million beneficiaries are in the catastrophic phase. That number is expected to grow steadily in the coming years. Moreover, at present, spending in the catastrophic phase now accounts for about 45% of total Medicare Part D expenditures.
The redesigned Medicare Part D benefit features a $2,000 hard cap on beneficiary out-of-pocket spending. At the same time, there will be a massive shift in cost management liability in the catastrophic phase. Currently, Medicare picks up the tab for 80% of costs in the catastrophic phase (the government is essentially the reinsurer in the catastrophic phase); plans, 15%; and beneficiaries, 5%. In the restructured Part D benefit, starting in 2025, the drug manufacturer will be responsible for 20% of catastrophic costs; plans, 60%; Medicare, 20%; and Medicare beneficiaries, 0%.
This $2,000 cap will obviously reduce Medicare beneficiaries’ financial burden considerably, especially those who are prescribed high-priced specialty cancer drugs, many of which put them in the catastrophic phase by the end of January in a given year, with no limit on out-of-pocket expenditures. In all probability, the $2,000 cap will lead to more utilization of specialty drugs and better patient adherence.
The Part D overhaul will also force payers and drug makers to rethink their strategies vis-à-vis cancer drug pricing and reimbursement. Payers will have to strike a harder bargain with drug makers when purchasing specialty pharmaceuticals. As payers won’t be able to fully offset their higher burden of cost management by raising premiums – there will be a 6% annual cap on premium increases. There will very likely be increased use of utilization management tools. And, perhaps most importantly, a more competitive market with more use of utilization management tools, such as prior authorization, step edits, and quantity limits. Also more use of outcomes-based pricing models. Partnering with Lyfegen may be the solution for manufacturers and payers alike, as its platform can put users on the right track towards successful implementation of value-based pricing arrangements.
Historically, as new checkpoint inhibitors, anti-PD-1 and PD-L1 agents, have gained approval – such as Jemperli (dostarlimab) in April of 2021 - price competition has not been a factor. This is extraordinarily unusual, given how relatively crowded the various oncology indications targeted by checkpoint inhibitors have become; from breast, renal, and colorectal cancer, to melanoma and non-small cell lung cancer. Several companies, including traditional ones like Lilly but also new entrants such as EQRx, are seeking to disrupt this space by offering lower-priced alternatives.
Outside the U.S., oncology drug pricing is generally heavily regulated. And, we observe that certain drugs may not be reimbursed by government (monopsonist) purchasers if there isn’t sufficient clinical benefit to justify the price. Moreover, in international markets, outcome- or value-based pricing strategies for cancer drugs are commonplace, which they aren’t yet in the U.S.
However, Medicare Part D restructuring alters the competitive landscape considerably. For high-priced specialty pharmaceuticals, in particular, it will become increasingly important for payers to contain costs by way of utilization management, promote the use of generics and biosimilars, and negotiate value-based prices. The Lyfegen Platform enables more efficient and transparent management of value-based drug pricing contracts by using intelligent algorithms to capture and analyze patient-level drug cost data.
About the author
Cohen is a health economist with more than 25 years of experience analyzing, publishing, and presenting on drug and diagnostic pricing and reimbursement, as well as healthcare policy reform initiatives. For 21 years, Cohen was an academic at Tufts University, the University of Pennsylvania, and the University of Amsterdam. Currently, and for the past five years, Cohen is an independent healthcare analyst on a variety of research, teaching, speaking, editing, and writing projects.
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Through the eyes of Simon Amstutz, briefly dive into the history of Michael Porter’s value-based healthcare theory.
For those who follow Lyfegen and our blog, chances are that you already fully grasp the concept of value-based healthcare (VBHC). That said, I came to Lyfegen from a completely different field, banking, and was intrigued by the history of how this theory came to be. While my intention is not to bore you with a history class, for all future posts it is important to have a common knowledge of the framework that lies behind VBHC.
In 2006, Harvard Professor Michael Porter and his fellow academic Elizabeth Teisberg published the book Redefining Health Care: Creating Value-Based Competition on Results . This book set the fundament of VBHC.
In this book they argue that competition in healthcare should be occurring in diagnosis, treatment (outcomes), and prevention of certain health conditions rather than between insurance plans and hospitals. They propose that the healthcare system should be restructured by having competition focus clearly on improved patient outcomes. The proposed model focuses on the value (yes, hence the name) that the medication or care brings to the patient. In other words, value is measured by the best outcome for the patient per dollar spent.
This being a monumental change from the current healthcare model, which operates on a fee-for-service/product basis. Under the conventional model, drugs and therapies have to be paid for regardless of whether they actually helped the patient. .
In order to achieve such a change, Porter argues that the healthcare system needs to be able to quantify health-care processes, outcomes, patient’s experiences, and organizational systems to evaluate the effectiveness of delivered care/medication as it benefits for the patient – this seeming like the greatest challenge back in 2006. But since then, technology and processes have evolved. This is where Lyfegen comes in: the challenges that our system was faced with 14 years ago now have a clear solution: Lyfeapp and Lyfevalue.
While Porter is most definitely not the only thought leader in the VBHC sector, his book shook and rattled the healthcare industry, identifying a clear need for solutions like those proposed by Lyfegen.
To find out more about our solutions:
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Lyfegen’s CFO, Michel Mohler, enlightens us on the recent measures presented by Switerland's Interior Minister Alain Berset against rising healthcare costs in Switzerland and what this means for Lyfegen.
In recent months it is difficult to ignore that various countries, also greatly due to the current pandemic, are challenging and revising their healthcare systems.
End of June, Nico reported on the Trump administration’s signed executive orders towards improving the healthcare system in the United States.
However, the wind is changing also in Switzerland as healthcare costs continue to rise. On August 19th, Switzerland’s Interior Minister Alain Berset (who also has healthcare under his responsibility) proposed a package of measures which would save the country approximately 1 Billion Swiss Francs (CHF), whilst boosting efficiency and the quality of health services.
The proposed plan includes the following measures:
1) Specialist care will only be covered if the patient first consults a general practitioner, HMO practice or a telemedical center. This will increase transparency and cost awareness throughout the entire process, ensuring that the patient only gets the treatment he/she needs from the right healthcare professional.
2) Networks of experts for coordinated care of chronic diseases are to be created on national level in order to improve the quality and efficiency of treatments, minimizing error in treatment.
3) Access to innovative but costly medication is improved through the legal consolidation of pricing-models. Pharma companies have to reimburse part of the costs to insurance companies however, until now, these were not regulated by the government. The legally set pricing models for Switzerland will be defined for reimbursement on price, sales volume, or pay-for-performance.
Overall, Berset aims at a closer cooperation between different players in the healthcare industry, increasing transparency and cost awareness.
What does this mean for Lyfegen?
Pay-for-performance is getting national recognition and legal regulation in the Swiss system. The proposed measures are now sent to cantons, political parties, institutions and organisations for consultation before the government presents its bill to parliament.
That said, this is a big step in the right direction for Lyfegen. Pay-for-performance would become a nationally recognized pricing model, meaning that Insurances will be more likely to adopt this model going forward – making the solutions of Lyfegen a necessity. Lyfeapp would allow for a facilitated methodology to collect data necessary for the value-based contracts on our Lyfevalue contracting solution. Lyfegen being the key pillar between pharma companies, insurance companies, and patients.
While we wait to see if this proposal is passed in parliament, we can now state with absolute confidence that Minister Berset’s clarity on pricing models goes hand in hand with Lyfegen’s mission: Doing what’s right for patients!
To find out more about our solutions:
Sources:https://www.admin.ch/gov/de/start/dokumentation/medienmitteilungen.msg-id-80111.html
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On Friday, President Donald Trump signed four executive orders aimed at lowering the high cost of prescription drugs in the United States. Our COO, Nico Mros, dives into the four executive orders.
“The four orders I’m signing today will completely restructure the prescription drug market in terms of pricing and everything else to make these medications affordable and accessible for all Americans,” Trump said at the White House last Friday.
Trump goes on to state that Americans often pay up to 80% higher prices for prescription drugs than countries like Germany and Canada.
And while the timing seems anything but coincidental, Lyfegen does not intend to discuss political views but rather understand what this could mean specifically for healthcare innovation, value-based contracting and the patients whose life depend on access to innovative therapies.
Let us briefly and in simple terms dissect the four executive orders, which are subject to the regulatory review process post Friday’s signature:
The first order targets high insulin prices and EpiPens, requiring federal community health centers to pass discounts they receive directly to patients.
The second order would allow states, pharmacies and wholesalers to import drugs from Canada, where prices are drastically lower. Importing drugs would increase competition and cause drug prices in the United States to decrease. Up until now, prices were maintained high because importing medications from other countries for personal use was illegal according to the Food and Drug Administration.
The third order is aimed at preventing “middlemen,” more commonly known in healthcare as health plan sponsors and pharmacy benefit managers (PBMs), to pocket “significant discounts” negotiated — these being “up to 50 percent of the cost of the drug” while retailing them without a discount.
The fourth order, which has been signed but is being held back until Aug. 24 to give the healthcare industry time to “come up with something” to reduce drug prices, would allow Medicare to purchase drugs at the same price as other countries by implementing a “international pricing index”.
The international pricing index would align U.S. prices to those of other countries, such as Britain, France and Canada – countries where the cost of the same drugs are substantially lower because Governments cap drug prices.
So what does this mean for pharmaceutical innovation?
Simply aligning prices to countries where governments cap drug prices (in the case of the fourth executive order) or opening the import of prescription drugs from neighboring countries (in the case of the second executive order) will result in billion dollar losses for pharmaceutical companies within the next decade, increasing the risk of losing the funds necessary to drive innovation substantially (specifically the Research & Development of cutting edge innovative therapies).
“We pay for all of the resources and all of the development and foreign countries pay absolutely nothing,” Trump said. “Americans are funding the enormous cost of drug resource for the entire planet.”
But could this mean that pharmaceutical companies, trying to compensate their losses, would (or better said, should) be forced to focus on the root problems of healthcare pricing and come up with more wide-spread innovative pricing models for a more sustainable future.
Value-based contracting and technological solutions, such as those of Lyfegen, could support such a future.
In a world where value-based pricing is the norm, world leaders would not only look over to neighboring countries for pricing levels but rather would have to focus on the value of drugs and how they improve patient health outcomes.
Pharmaceutical company executives were scheduled to meet at the White House today to discuss the executive orders but the meeting was cancelled. Moving forward, one can only hope that healthcare innovation can start coexisting with sustainable expenditure and patient access.
https://www.nytimes.com/reuters/2020/07/27/us/27reuters-usa-trump-drugprices-explainer.html/
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Lyfegen HealthTech AG announced today that it has raised CHF 2 million of additional capital, bringing its total funding to CHF 3 million. Read the full press release.
BASEL, Switzerland, Sept. 1, 2020 /PRNewswire/ --
- Investors back Lyfegen's mission to make innovative healthcare therapies more accessible and affordable
- Funding secures market-leading position prior to Series A opening in 2021
Lyfegen HealthTech AG, a Swiss health technology company, announced today that it has raised CHF 2 million of additional capital, bringing its total funding to CHF 3 million. The additional funding was completed by private investors and the innovation program of one of Switzerland's largest banks.
Lyfegen has developed a ground-breaking software solution to accelerate value-based healthcare contracting, pioneering in a global market that could reach USD 400 billion by 2024, according to the latest estimates by research firm MarketsandMarkets™. Some of the world's 10-largest pharmaceutical and medical technologies companies are already employing Lyfegen's platform in strategic markets in Europe and South America.
Girisha Fernando, Chief Executive Office and co-founder, said: "Increasingly, healthcare systems around the world are transitioning from fee-for-service payment schemes to value-based contracting. Our solutions support the shift towards sustainable payment models that help ensure patients get the treatments they need at prices they can afford, while healthcare companies make an adequate return on their investment. We are proud to have strong partners and investors on board to support us in this challenging and rewarding mission."
The new funding, combined with the seed capital raised in April 2019 and the founders' contributions, secures the development of Lyfegen's proprietary technology as it continues to roll out its value-based contracting solution in the U.S. as well as additional European and Latin American markets in the areas of oncology, rare diseases and medical devices.
Michel Mohler, Chief Financial Officer and co-founder, added: "We continue delivering on our ambitious goals prior to opening our Series A funding in 2021. This latest additional funding confirms the growing interest of international investors in innovative healthcare technology built for a data-driven world. The funds will be used to further strengthen our leading market position as we prepare for a strong Series A funding round."
About Lyfegen
Lyfegen HealthTech AG is a Swiss healthcare technology company that is pioneering digital value-based healthcare contracting. Lyfegen's patent-pending, ground-breaking software analyses complex healthcare data sets in order to help patients access innovative therapies that focus on the healthcare outcomes that matter most to them. Lyfegen's solutions collect the patient's specific medical profile whilst ensuring the strictest data privacy protocols. Lyfegen's founders Girisha Fernando, Michel Mohler, Nico Mros, and Leon Rebolledo have combined their expertise in life sciences and financial services to create a holistic solution that enables life sciences companies, healthcare payers and healthcare providers to develop and roll out digital value-based healthcare, a market that is set to grow to USD 400 billion by 2024.
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EGK uses the Lyfegen Platform to handle complex pricing models of on and off-label usage of more than 80 drugs
Basel, Switzerland - November 29, 2022 - Lyfegen, a global healthtech SaaS company driving the world’s transition from volume to value-based healthcare for high-cost drugs, announced today that EGK-Gesundheitskasse is joining its portfolio of insurer partners to execute all of their value-based pricing contracts for high-cost drugs efficiently, securely, and transparently.
Switzerland, with the fourth-highest pharmaceutical spending per capita, spent CHF 8 Billion (8.1 billion euro) on drugs prescribed for specific diseases in the first nine months of 2022. In an effort to combat the high drug spending, Switzerland has implemented an increasing number of discount models for on and off-label drug usage over the last five years. While intending to ensure accessibility to patients at sustainable prices, the complexity of the price models leads to millions spent by insurers to monitor and adjudicate the price models, resulting in an estimated CHF two- to three-digit million range of missed rebates.
Lyfegen's software enables EGK to identify and claim rebates from 141 drug price models with 32 manufacturers, with minimal effort and maximum transparency. This includes cases of rare or chronic illnesses, promising therapies that may be used outside the approved indication, or new drugs not yet available or approved in Switzerland. Lyfegen's platform addresses the needs of Swiss health insurers for cost efficiency and digitalization, helps solve existing complexities in the system, and does its utmost to counteract high insurance premiums.
"We are delighted to support EGK and take an active role in addressing the growing complexity of drug pricing models to support sustainable access to innovative drugs and therapies in Switzerland,” said Nico Mros, CXO and Co-Founder of Lyfegen. “By focusing on making the implementation of the platform as easy as possible and being responsive to EGK, we were able to quickly present results and kickoff the collaboration to a successful start!"
“With the Lyfegen Platform, EGK is further expanding its focus on sustainability and efficiency for the benefit of our policyholders”, said Carolina Pirelli, Head of Benefits and Deputy CEO at EGK. “The ever-increasing number of pricing models for medications poses challenges for insurance companies in terms of resources and processes. With the automated processing of pricing models through the Lyfegen Platform, we are able to perfectly meet our current needs and with Lyfegen's flexibility, focus and understanding, we see ourselves in good hands.”
About Lyfegen
Lyfegen is a global healthtech SaaS analytics company providing a value-based agreement platform for drugs, therapies and devices. Health insurances, pharma, medtech companies & hospitals use the secure platform for thousands of payment models throughout Switzerland, Europe, the Middle East and North America. The Lyfegen Platform supports the negotiation and automated execution of value-based payment models cost-effectively and at scale using real-world data and machine learning. Globally renowned health insurances, hospitals, pharma & medtech companies have already implemented Lyfegen’s patent-pending platform to scale value-based payment models for drugs, therapies and devices, improving access to treatments and patient outcomes.
Lyfegen was founded by individuals with decades of experience in healthcare, pharma and technology, pioneering the shift away from volume-based and fee-for-service healthcare to value-based healthcare. For more information, visit www.lyfegen.com.
About EGK-Gesundheitskasse
EGK-Gesundheitskasse is an SME health insurer based in Laufen (BL), Switzerland. The EGK Group comprises EGK Grundversicherungen AG (basic insurance in accordance with KVG), EGK Privatversicherungen AG (supplementary insurance in accordance with VVG) and EGK Services AG (administration). It insures around 100,000 people in basic insurance throughout Switzerland, 80% of them also have EGK supplementary insurance.
Naturalness and sustainability are part of EGK's values. It is considered a pioneer in providing unrestricted access to excellent complementary medicine. It launches and supports activities throughout Switzerland to strengthen health in a natural way.
Read on PR newswire in English
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Lyfegen’s value-based contracting software is used by healthcare payers and leading pharma companies, including Novartis, Roche, MSD, Bristol Myers Squibb (BMS) and Johnson & Johnson
New York, NY - September 20, 2022 - Lyfegen, a global healthtech SaaS company driving the world’s transition from volume to value-based healthcare for high-cost drugs, today announced an oversubscribed $8 million Series A financing round led by aMoon, with additional participation from APEX Ventures and others.
Currently, less than 2% of the health insurance population requiring specialty drugs is responsible for 51% of drug spending. The cost of specialty drugs in the US is spiraling out of control, increasing 12% from 2020 to 2021 alone, with no sign of slowing down due to the increase of cell and gene therapies expected to come to market. As a result, value-based contracting is becoming a more viable alternative for healthcare payers to only pay for drugs that actually work.
By 2025, total net spending on medicine in the US is expected to reach up to $400B. Additionally, new drugs regularly enter the market, but when pharmaceutical companies fail to agree on commercial terms with payers, patients are at risk of being denied access to life saving therapies. Lyfegen’s platform helps regulators, pharma companies and payers more easily adopt value-based payment models by digitizing the end-to-end process of data collection, anonymization and contract negotiations for all parties to agree upon drug pricing and reimbursement.
“We are excited to be announcing this funding round and to have this vote of confidence from aMoon, APEX and our other investors who understand the shift in healthcare that we are experiencing, and are supporting our efforts to expand the Lyfegen platform,” said Girisha Fernando, CEO and founder of Lyfegen. “We currently work with leading government payers, health insurance companies in Europe, the US and the Middle East, and some of the world’s largest pharma companies. Our plan now is to further expand our presence in the US, partnering with both private and public healthcare insurance companies. The move away from volume-based healthcare has never been more needed, and we are happy to play an important role in the shift to value-based contracting.”
“Lyfegen is addressing a significant market need in an industry that is changing dramatically and rapidly, and we are thrilled to help validate their efforts through our investment,” said Moshic Mor, General Partner at aMoon, and former Partner at Greylock and Greylock Israel. “During a time of healthcare budget pressures and recessions, the world needs Lyfegen’s solution now more than ever. We look forward to seeing the company, led by an incredible executive team, continue to enhance access to new drugs as they drive value-based healthcare to become increasingly mainstream.”
About Lyfegen
Lyfegen is an independent, global software analytics company providing a value and outcome-based agreement platform for health insurances, pharma, medtech & hospitals around the globe. The secure platform identifies and operationalizes value-based payment models cost-effectively and at scale using a variety of real-world data and machine learning. With Lyfegen’s patent-pending platform, health insurances & hospitals can implement and scale value-based healthcare, improving access to treatments, patient health outcomes and affordability.
Lyfegen is based in the USA & Switzerland, and was founded by individuals with decades of experience in healthcare, pharma and technology to enable the shift away from volume-based and fee-for-service healthcare to value-based healthcare. For more information, visit www.lyfegen.com.
Media Contact
Yael Hart
GK for Lyfegen
Read the Exclusive article with AXIOS
Read the Press Release on PR Newswire
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The whitepaper is a joint initiative to share with healthcare stakeholders some of Lyfegen and KPMG’s expertise and experience in the development and implementation of value and data-driven agreements in an evolving healthcare environment.
Official Communication by KPMG on 26.10.2020
KPMG addresses the most pressing challenges the healthcare sector is facing today and in the future. Society’s desire to obtain value from the wider healthcare system is not new, however recent experience shows that there is a need to rethink and move healthcare into a new age.
Two current megatrends are: 1) the redesign of pricing for health solutions, and 2) the value of data and the importance of patient access. It is important to address both elements within the Life Sciences ecosystem, including how to innovate, how to develop successful digitalization strategies, and how to get the most out of data.
How outcome-based contracts benefit healthcare
The pricing of services and products based on outcomes or value created is another intrinsic element of the future of healthcare. Rising healthcare costs impact patient budgets and hinder access to treatments. Incentivizing positive outcomes can only benefit patients, while payers gain confidence that they are only reimbursing effective treatments. Manufacturers and providers that buy into the outcome-based model are taking an important step towards making their business more sustainable while contributing to the wider interest of the healthcare ecosystem.
One of the key issues has always been defining the factors that represent value and deciding how to measure them. To give an example, how do you measure if a patient is symptom-free and how long should the observation period last? How is the impact on those caring for an individual considered and how is the societal or economic impact assessed, e.g., can the individual go back to pursuing a career? These questions are key in any reimbursement of pricing arrangements.
Helping the healthcare community
Teaming up with Lyfegen, a healthtech company facilitating access to innovative therapies, KPMG recently published a joint whitepaper (see link below) on the application of outcome-based contracting. Girisha Fernando (CEO and Founder of Lyfegen HealthTech AG) and Martin Rohrbach (Head of Life Sciences for KPMG Switzerland) discuss how this approach can deliver value for healthcare payers, providers and patients.
The whitepaper is a joint initiative to share with healthcare stakeholders some of Lyfegen and KPMG’s expertise and experience in the development and implementation of value and data-driven agreements in an evolving healthcare environment. The combination of knowledge, reach, and technology specific to value-based healthcare, together with proven practical experience, brings unique insights into value and data-driven pricing agreements for healthcare stakeholders. The whitepaper focuses on why outcome-based contracting can address drug access and reimbursement challenges, and how such contracts can be enabled by innovative technology. There are some clear takeaways, serving as building blocks and opportunities to engage in outcome-based contracting for the benefit of healthcare systems.
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Basel, Switzerland | April 17th, 2019 – Lyfegen HealthTech AG successfully closes its seed financing round, raising a total of CHF 750‘000. The funding was led by Swiss private investors. The funds will be used to further build Lyfegen’s value-based payments platform Lyfevalue and conduct further pilots with partners in the US, Africa, and the EU, including the UK.
Lyfegen is a healthcare technology company that has developed a ground-breaking solution to accelerate value-based healthcare, entering a market set to grow to USD 390.7 billion by 2024 according to latest market research. Its platform, Lyfevalue, collects, analyses & reconciles disparate healthcare data for the purpose of automating value-based healthcare contracting. The platform enables life sciences companies, national and private healthcare payers and healthcare providers to operationalise value-based healthcare strategies whilst benefiting from a single holistic solution for their value-based healthcare operations, visit checklistmaids.com. In addition, the platform allows for personalised healthcare by enabling patient level pricing, fostering accelerated and facilitated access to innovative treatments for patients.
“Enabling the shift to sustainable healthcare is a huge challenge, giving us at Lyfegen great purpose and we are honoured to work with individuals that truly care about making a difference for patients around the world,” said Girisha Fernando, Lyfegen’s CEO & Founder.
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We are thrilled to welcome Ina Hasani to our team at Lyfegen as Director of Sales & Business Development for Canada. Ina brings nearly a decade of experience in the life sciences sector, specializing in healthcare strategy, market access, and health economics. We sat down with Ina to learn more about her background, her vision for transforming healthcare in Canada, and what excites her most about joining Lyfegen.
Can you tell us a bit about your background and what led you to your role as Director, Sales &Business Development for Canada at Lyfegen?
I have spent close to a decade in the life sciences sector, working with companies like Novartis and Pfizer, where I gained deep expertise in healthcare strategy, market access, and health economics. My passion has always been focused on improving patient outcomes and the healthcare system. This led me to Lyfegen, a company at the forefront of transforming healthcare through innovative solutions. The opportunity to work with payers and drug manufacturers to ensure better and sustainable access to innovative treatments for patients was a natural fit for me, both professionally and personally.
What are the biggest challenges facing the healthcare market in Canada, particularly in terms of drug pricing and access?
The Canadian healthcare system is highly complex! The biggest challenge that we are facing is how to accelerate access to innovative therapies without compromising the sustainability of the healthcare system. Payors, including both public and private insurers, are struggling to balance their budgets with the rising costs of therapies, particularly for specialty drugs. Outcome based agreements are a potential solution to enable timely access to breakthrough therapies. However, payors and pharmaceuticals don’t have the infrastructure in place to efficiently implement and operationalize such agreements.
What opportunities do you see for growth in Lyfegen’s sales efforts in Canada? How can we better support health insurers and government bodies?
There is tremendous potential for growth. Currently, payors and pharmaceuticals adjudicate their product listing agreements (PLAs) manually through Excel spreadsheets. It is resource intensive, leaves room for errors and is a barrier to potential innovative contracting. In addition, as Canada increasingly looks towards value-based healthcare models, Lyfegen is an enabler by providing the digital infrastructure for payor and manufacturers.
From your perspective, what key actions need to be taken in the next 12 months to drive success for Lyfegen in the Canadian market?
In the next 12 months, we need to focus on deepening our relationships with key stakeholders and demonstrate the value of our digital solutions for payors, manufacturers, healthcare system and, ultimately, the patients.
How do you see your role influencing the implementation of value-based solutions in Canada, and what impact do you hope to have?
Lyfegen has extensive experience in OBA implementation and operationalization in many countries. In my role, I hope to bridge the gap from theory to practice in the implementation of value-based healthcare in Canada.
In your opinion, what’s the most important aspect of building strong client relationships in the healthcare industry? How do you approach this in your role?
Trust and communication are at the core of any strong client relationship in healthcare. Given the complexity and sensitivity of the industry, clients need to know that you understand their unique challenges and are committed to solving them. In my role, I prioritize open and ongoing communication, ensuring that clients feel heard and that their feedback is integrated into our solutions. I also work hard to build trust by delivering results and being transparent about what we can achieve together.
Looking ahead, what excites you most about the future of sales and business development at Lyfegen in Canada?
I’m excited about the potential to be a catalyst for significant change in the Canadian healthcare landscape. Lyfegen is in a unique position to lead this transformation. The combination of increasing demand for cost-effective healthcare solutions and our innovative approach makes this an incredibly exciting time to be in sales and business development.
Outside of work, what are some of your favorite things to do in your free time?
Outside of work, I enjoy spending quality time with my family and friends. I also prioritize my health by being active on a daily basis. I also enjoy learning. Now that I have completed my MBA, I’m on a mission to learn Spanish.
We are excited to see Ina grow and thrive in her role at Lyfegen. Welcome to the team, Ina!
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Once upon a time, In a whimsical forest, there lived a smart and creative blue bird. This bird, known for its brilliance in the world of tiny forest biotech, had concocted a magical potion.
This potion was a wonder, a gene therapy to cure the forest creatures of a troublesome disease called sickle cell. Perched thoughtfully on a branch, the blue bird faced a whimsical yet vital challenge. The potion, potent in its healing, needed to be more than just a marvel of science – it had to be reachable and affordable for all in the forest. Additionally, this magical creation was still unnamed, a name that should echo its life-affirming qualities and the journey from a mere idea to a beacon of hope in the forest.
Amidst this puzzlement, the blue bird heard tales of the wise owls of Lyfegen, far beyond the forest. These owls were not just wise; they were masters of a different kind of magic – the magic of numbers and agreements that made health solutions reachable to all. Intrigued, the blue bird fluttered over to learn more.
As it learned about Lyfegen's remarkable ability to navigate the complex world of potion pricing and access, inspiration struck. "Ah-ha!" chirped blue bird, "If Lyfegen can make health solutions accessible, why not name my potion in honor of their work? Lyfgenia – a name that sings of life, hope, and the ingenuity of Lyfegen!"
And so, the potion was christened Lyfgenia, a nod to the owls of Lyfegen whose wisdom ensured that such medical marvels reached every nook and cranny of the forest without burdening its inhabitants.
With its new name, Lyfgenia became more than just a potion; it symbolized a harmonious blend of medical genius and financial savvy. The blue bird turned Lyfgenia into a symbol of hope and healing in the whimsical world of the forest.
Disclaimer: "A Fable of the Blue Bird and Lyfegen's Wise Owls" is a work of fiction, created solely for entertainment and illustrative purposes. This fable does not represent any real-life strategies, decisions, or actions of these entities, nor should it be interpreted as an endorsement or representation of their values, capabilities, or business practices.
Using Lyfegen's solutions can streamline the financial management of advanced therapies like Lyfgenia, leading to more effective pricing strategies and improved access for patients. Learn more about how our solutions enable value-based contracting for gene therapies: lyfegen.com
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Amid the buzz of innovation at Lyfegen, we sat down with Simon, our newest team member, whose journey has brought a fresh perspective to our mission.
Quick introduction – tell us a bit about yourself!
I'm based out of the UK. I studied Law at University but soon realized that a career as a Solicitor wasn’t my calling. Post-university, I ventured into Software Sales, initially focusing on Cloud Solutions and then transitioning into the Life Sciences realm. Most of my career has been dedicated to building startups and introducing new ideas and products to the market.
What excites you about your job?
What really thrills me about joining Lyfegen is the potential impact I can have on those needing life-saving treatments. The core goal of the pharma industry is to enhance the health and wellbeing of society, and at Lyfegen, we're crafting solutions that make medications more accessible, allowing us to treat more people. It's also incredibly rewarding to collaborate with some of the world's leading pharma companies, supporting them as they launch new assets.
Why did you decide to join Lyfegen?
It was the founders' vision that drew me to Lyfegen. Their passion was evident right from our initial conversations. Joining Lyfegen is an incredible opportunity for me to contribute my experience to another startup, and together, we can continue to thrive on this exciting journey.
What is something you want to learn or improve in the next 12 months?
Over the next year, I aim to deepen my understanding of the market access space within the pharma industry. Launching assets is intricate, with many layers involved, and there's a wealth of knowledge I'm eager to absorb. It's fascinating to learn about the different approaches of various companies and how they navigate the market.
How will your know-how help improve our customers’ experience of Lyfegen solutions?
With my background in launching new solutions for startups, I'm well-acquainted with the challenges that can arise. We can be proactive in addressing these before they occur. As Lyfegen is growing rapidly, it’s crucial that we adapt while maintaining our high standards and always remembering that our customers are our biggest priority. My experience with Global enterprises has also given me insight into the ongoing support they need and the importance of fostering great relationships based on trust and understanding.
Let’s get personal: What are your favorite things to do in your free time?
In my free time, I love to travel as much as I can, exploring different cultures and places, with my next plans to delve into more of Asia. When I'm in the UK, I spend time with my German Shepherd, Max, or playing water polo.
Is there anything else you are looking forward to outside of work in the next few months?
As we near the end of Q4, it's a busy period, but I'm looking forward to a well-deserved break over Christmas with friends and family, indulging in good food. It's the perfect time to recharge and gear up for a significant 2024 for Lyfegen, where we'll continue to serve our customers, engage with new ones, and grow as a company.
Our conversation with Simon ends on a high note, filled with anticipation for the contributions he will bring to Lyfegen. In the words of Girisha Fernando, our CEO, "we are very excited about Simon joining us. His experience is a valuable addition to our team, and we are confident he'll make a significant contribution to our mission. It's a pleasure to welcome him to Lyfegen."
Here’s to new beginnings and transformative journeys!
Welcome to our crew, Simon.
Amid the buzz of innovation at Lyfegen, we sat down with Simon, our newest team member, whose journey has brought a fresh...
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At this years World Evidence, Pricing and Access event, Girisha Fernando, the CEO of Lyfegen, expressed excitement as he spoke about the company’s latest launched offering - the Lyfegen Model & Agreement Library. This unique learning resource is a true game-changer that builds upon the company’s existing product. It expands our horizons by allowing payers and market access & pricing professionals to explore over 2’500 real-life public agreements, and 18 drug pricing models from around the world. The library provides an unparalleled understanding of drug reimbursement models that help users make better informed choices like never before.
Selecting a drug reimbursement model is very complex, as manufacturers want quick market access, while payers may have many concerns, such as a drug’s efficacy and affordability. Fernando emphasized that the library bridges the gap by assisting payers and market access professionals in finding specific models that address each stakeholder’s concerns, and key real-life agreement examples, resulting in better-informed decision-making, and ultimately more efficient reimbursement processes.
“Because of rising healthcare costs and the increase of medical innovations, the thirst for knowledge and need for value-based healthcare capabilities has surged among healthcare payers and pharma companies across the world”, said Fernando, “That is why we are excited about launching the world’s largest database of real-world value-based agreements. It gives payers and pharma a unique insight into how to structure value-based agreements.”
But that’s not all – Fernando explained that the database is constantly evolving, being updated weekly with new public agreements, allowing stakeholders to be up to date on public agreements.
Overall, it is clear that the Lyfegen Model & Agreement Library is an invaluable groundbreaking tool, that is becoming indispensable in increasing the knowledge on drug and Cell & Gene Therapy reimbursement.
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He’s analytical, a techie and has a fantastic gift for music! Yes, we are talking about the latest addition to our team, our very own “Technical Business Analyst” and Ukrainian superstar: Pavlo Lupandin!
Just last month we announced the arrival of our Lead Developer, Daniel, and now more great news follows as Lyfegen continues to lay focus on the technical team: we have our very own Technical Business Analyst, Pavlo!
“Pavlo’s sharpness and problem-solving skills just made it clear that we needed him in our team! His drive and commitment will bring great value to our patients, our customers and Lyfegen as we continue to sharpen our platform” says Lyfegen’s CEO, Girisha Fernando.
We are proud to have him as part of the team and sat down with him to give you a little more insight behind the musical talent and witty “Technical Business Analyst”:
Hi Pavlo! Tell us a little about yourself: where are you from and what is your work experience background?
Hello! I was born in the east of Ukraine, got the Master’s Degree in Economics in Kyiv, worked at one of the Big 4 companies for 3 years as an Auditor, following one year in the role of Business Analyst. After this experience, I found myself being a fresh ACCA Member, who wanted to dive into something not that accounting related. Business analysis has proven to be an interesting area where I can develop further capitalizing on my previous experience.
It’s interesting, that back in my audit days I’ve had some big healthcare-related projects. Who knew that it was only the beginning of working in this promising domain…
This is your first experience in the Health Tech industry – what triggered this move?
Pace of development. The Healthcare & IT industries are developing in overwhelming waves, and to ride the peak of those waves is a challenge – formidable, but a tempting one. As soon as this opportunity presented itself, I decided to chase it. We’ll see, where this decision will bring me in a couple of years.
You are joining Lyfegen as Technical Business Analyst. In simple terms: what will you be working on?
I would be occupied mainly with gathering, documenting and communicating the requirements of our customers. Ever heard of different communication barriers? Those I would try to eliminate, trying to grasp the very core of what has to be done for the maximum customer satisfaction and making sure the development team implements requirements as close as possible to the ideal.
What are your next personal goals with Lyfegen?
There are several of them. First, I strive for development as a professional, and I think Lyfegen will provide me with opportunities to do that. Second, I want to embrace that spirit of a high-growth startup – after working for a massive and complex company, the flexibility and freedom of Lyfegen is a breath of fresh air. And finally, I want to know new talented people. I already know, that the Lyfegen team has a great diversity, and I can’t wait to learn some interesting things from people of other countries and cultures.
What motivated you to join?
Purpose and value. As simple as that. I can see the purpose and value of what I’m doing. Obviously, we are at the beginning of this journey, and it’s a bit early to speak about “value-based pricing for everybody” or “pay only for what is really working” but…the concept is huge, and it will become the question of life and death for some patients. And I’ll do my best to make it as close to life as possible.
Enough about work! What passions do you have outside of Lyfegen?
Oh, you don’t want to hear a full list, I assure you. Let me try to sum it up quickly…Music, videogames and tabletop games – I play them all. A small collection of musical instruments – some of them are quite exotic, especially for my home country (banjo and djembe, for example). A bigger collection of tabletop games in different genres – the Lyfegen team can definitely expect a session or two in the nearest future. And a vast collection of videogames on different platforms…without much details let’s just agree there are a lot.
There are some other hobbies of mine, but I’d prefer to keep a couple of surprises up my sleeve!
We are proud to have the Lyfegen team continue to grow with such fantastic team-members!
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Introduction
Donald Trump has been elected as the 47th President of the United States. With healthcare remaining a critical issue, it’s valuable to revisit some of Trump’s past healthcare reforms and examine a particularly controversial policy that could significantly impact drug pricing in the U.S. From efforts to lower out-of-pocket costs to transparency initiatives aimed at increasing competition, Trump’s past healthcare policies reveal a complex approach to improving accessibility and affordability. Here, we also explore how these initiatives have evolved under the Biden-Harris administration and what their potential implications could mean for the future of American healthcare.
Let’s examine some of his past reforms to improve healthcare and discuss a controversial policy that could greatly alter drug pricing.
Conclusion
The evolving landscape of American healthcare policy, influenced by both Trump and Biden’s administrations, reflects an ongoing effort to address cost, transparency, and access to treatment. Trump’s initiatives laid the groundwork for healthcare cost transparency and patient protections, while the Biden-Harris administration has expanded these initiatives and introduced groundbreaking policies like Medicare drug price negotiation. As these changes continue to unfold, the healthcare industry, patients, and policymakers alike will need to adapt to new dynamics, shaping the future of healthcare in the United States.
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Introduction
Canada’s Drug Agency has recently awarded funding to multiple rare disease registries to enhance the “pan-Canadian evidence landscape.” This funding is aimed at bolstering the quality and accessibility of data that can guide regulatory and reimbursement decisions for rare disease therapies. As Canada focuses on building a comprehensive evidence base, pharmaceutical companies, payers, and stakeholders must adapt to the evolving landscape for market access and contracting. Lyfegen’s Agreements Library and Drug Contracting Simulator offer vital tools to navigate these complexities with greater precision and transparency.
Key Takeaways for Pharma and Payers
1. Strengthening Data Quality and Accessibility
• What’s Changing: The new funding will support initiatives to improve data accuracy, completeness, and accessibility within rare disease registries across Canada. This enriched data landscape will play a crucial role in guiding therapeutic decisions for rare diseases.
• Impact: With access to more comprehensive data, pharma companies and payers can make more informed decisions regarding therapy efficacy and patient outcomes. This data-driven approach is essential for adapting market strategies to address the specific needs of rare disease populations in Canada.
2. Supporting Regulatory and Reimbursement Decisions
• What’s Changing: The funding will enable the development of evidence needed to meet Health Canada’s regulatory requirements and the Canadian Agency for Drugs and Technologies in Health (CADTH) reimbursement criteria for rare disease treatments.
• Impact: A robust evidence base will accelerate the approval and reimbursement process for rare disease therapies. Pharma and payers can benefit from shorter timelines for market entry and more predictable pricing models aligned with outcomes-based agreements, ensuring that patient needs are met in a timely manner.
3. Advancing Outcome-Based Metrics and Digital Health Solutions
• What’s Changing: Emphasis on outcome-based evidence and digital health transformation within rare disease registries will promote a transparent, efficient healthcare ecosystem for these high-cost therapies.
• Impact: Outcome-based metrics provide pharma and payers the opportunity to structure contracts that reflect real-world patient outcomes, supporting more sustainable pricing models that align with the health outcomes valued by Canadian healthcare providers.
How Lyfegen’s Solutions Can Support Your Strategy
1. Agreements Library: Lyfegen’s Agreements Library, a vast digital repository of drug pricing agreements, offers valuable insights into historical trends and pricing models that support evidence-based contracting decisions. By leveraging over 6,000 agreements and diverse pricing models, pharma and payers can develop contracts that align with Canada’s specific regulatory and reimbursement frameworks.
2. Drug Contracting Simulator: Lyfegen’s Drug Contracting Simulator enables teams to model various pricing scenarios, allowing them to understand potential outcomes and financial risks associated with rare disease therapies. By simulating real-world conditions, stakeholders can make informed contracting decisions that support the Canadian healthcare system’s goal of data-driven, sustainable solutions for rare diseases.
Conclusion
Canada’s initiative to strengthen its rare disease data landscape marks a significant step forward in improving access to and affordability of rare disease therapies. For pharma companies, payers, and other stakeholders, this shift provides opportunities to develop innovative contracts that align with Canadian healthcare goals. Lyfegen’s Agreements Library and Drug Contracting Simulator offer the tools needed to support evidence-based decision-making, enabling healthcare players to navigate Canada’s evolving market access landscape confidently.
Book your demo today to discover how our tools can transform your approach to rare disease therapy access in Canada: https://www.lyfegen.com/demo
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Introduction
The FDA has launched an innovative pilot program to expedite patient access to essential therapies: the Split Real Time Application Review (STAR). Starting December 2, both the Center for Drug Evaluation and Research (CDER) and the Center for Biologics Evaluation and Research (CBER) will begin accepting a limited number of marketing applications under this new initiative. By focusing on early and continuous review processes, the STAR program aims to minimize the time between final submission and the FDA’s action date, providing faster access to treatments for patients with unmet medical needs.
Key Takeaways for Pharma and Healthcare Providers
1. Accelerated Review Process for Unmet Needs
• What’s Changing: The STAR program is designed to review applications in segments, allowing FDA reviewers to assess data in real time as it becomes available. This continuous review approach differs from traditional methods, where applications are evaluated in full only after complete submission.
• Impact: For pharmaceutical companies, this streamlined process could mean faster paths to market, particularly for therapies targeting critical, unmet needs. It emphasizes the FDA’s commitment to addressing patient needs more swiftly, which could reduce financial burdens on developers facing lengthy approval processes.
2. Collaboration Between CDER and CBER
• What’s Changing: The STAR program is a collaborative effort involving both CDER and CBER, expanding its applicability to a broad range of therapies, including new drugs and biologics. This joint approach signals the FDA’s intention to standardize and extend this model across diverse therapeutic areas.
• Impact: By involving multiple FDA centers, the STAR program encourages broader participation from biotech and pharmaceutical companies developing biologics, vaccines, and innovative therapies. For patients, it represents a promising step toward quicker access to a wider array of advanced treatment options.
3. Focus on Real-Time Data and Incremental Submissions
• What’s Changing: Unlike traditional application reviews that rely on fully completed submissions, STAR’s approach allows the FDA to review segments as they are completed. This real-time data review supports a more dynamic evaluation process and could accelerate decision-making.
• Impact: For the pharma industry, this shift may lead to shorter regulatory timelines and a more predictable approval process. By providing early feedback on submitted data, the FDA enables companies to address potential issues proactively, ultimately supporting faster market access for breakthrough therapies.
Conclusion
The FDA’s STAR program represents a transformative approach to regulatory review, one that aligns with the needs of modern healthcare. By focusing on continuous, real-time reviews, the FDA is paving the way for faster patient access to treatments that address critical health needs. For pharmaceutical companies and healthcare providers, this new pathway offers a chance to bring innovations to patients more swiftly and efficiently. As the STAR program unfolds, its success could shape the future of regulatory review, setting a new standard for timely patient access in the U.S. healthcare system.
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Introduction
Switzerland has taken steps to streamline drug approvals and make essential therapies more accessible by revising Swissmedic’s fast-track and temporary authorization procedures, effective as of October 15, 2024. These changes aim to expedite market access for crucial treatments, especially for those addressing urgent healthcare needs. Recently, the Federal Office of Public Health (FOPH) conducted a Health Technology Assessment (HTA) on Calcitonin gene-related peptide (CGRP) receptor antagonists, a class of anti-migraine drugs. The analysis determined that these drugs are more cost-effective for chronic migraine sufferers than for those with episodic migraines, influencing how they may be priced and reimbursed.
Key Takeaways for Pharma and Payers
1. Revised Fast-Track and Temporary Authorization Processes
• What’s Changing: Swissmedic has updated its fast-track and temporary authorization procedures, intended to speed up drug approval times. This revision allows for quicker access to therapies that address significant healthcare needs, supporting patients in receiving timely treatments.
• Impact: For pharmaceutical companies, these changes open up opportunities to bring their innovations to market faster, particularly for therapies that address chronic and complex conditions. With the fast-track pathway, companies can achieve quicker regulatory approval, which could help with meeting demand and advancing critical treatments for conditions like chronic migraine.
2. Pricing Adjustments Based on Cost-Effectiveness Analysis
• What’s Changing: The FOPH’s recent HTA on CGRP receptor antagonists for migraines concluded that these drugs offer higher cost-effectiveness for chronic versus episodic migraine patients. As a result, FOPH has proposed a price reduction to align with the value provided, ensuring that patients benefit from more affordable access to these treatments.
• Impact: For payers and pharma, this emphasis on value-based pricing represents a growing trend in Switzerland. Drug prices are being set based on real-world evidence and cost-effectiveness, pushing the industry towards more sustainable, outcome-driven pricing models.
3. Inclusion in the List of Pharmaceutical Specialities (LS)
• What’s Changing: FOPH re-evaluates drug prices every three years and decides if they should remain on the List of Pharmaceutical Specialities (LS), which comprises all drugs covered by basic insurance. For certain treatments, such as CGRP receptor antagonists, drugs may be included with limitations—meaning they will only be reimbursed under specific conditions.
• Impact: This conditional reimbursement approach supports more targeted healthcare spending, benefiting patients who meet specific criteria. For pharmaceutical companies, meeting these requirements is essential to ensure ongoing reimbursement and access to Switzerland’s market.
How Lyfegen’s Solutions Can Support Your Strategy
1. Agreements Library: Lyfegen’s Agreements Library offers a comprehensive resource of pricing agreements, enabling pharma and payers to explore pricing models that align with Switzerland’s emphasis on cost-effectiveness. With access to over 6,000 agreements, pharma teams can develop flexible, outcome-based pricing strategies that meet Swiss regulatory and reimbursement requirements.
2. Drug Contracting Simulator: The Drug Contracting Simulator provides a powerful tool for modeling various pricing scenarios. By simulating real-world conditions, stakeholders can assess the financial and clinical outcomes of fast-track approved therapies, enabling them to create tailored, data-driven agreements that reflect the FOPH’s cost-effectiveness criteria.
Conclusion
Switzerland’s recent adjustments to its fast-track drug approval processes and value-based approach to anti-migraine drug pricing underscore the country’s commitment to accessible, cost-effective healthcare. For pharmaceutical companies and payers, these changes represent an opportunity to align market access strategies with Switzerland’s evolving regulatory landscape. Lyfegen’s Agreements Library and Drug Contracting Simulator offer essential support for navigating these complexities, helping stakeholders design effective, outcome-driven agreements that meet Switzerland’s regulatory standards.
Book a personalized demo today to see how Lyfegen can transform your market access strategy under Switzerland’s new reforms: https://www.lyfegen.com/demo
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Introduction
Spain is making strides in healthcare by prioritizing education, innovation, and cost-effective care. Recently, the Spanish Council of Ministers allocated over 44 million euros from pharmaceutical sales to support various public health initiatives, focusing on two critical areas: reducing unnecessary care and enhancing Health Technology Assessment (HTA) education for healthcare professionals. These investments are aimed at improving the efficiency of healthcare delivery, reducing costs, and supporting more informed decision-making around drug use and preventive care.
Key Takeaways for Pharma and Payers
1. Funding for HTA Education and Training
• What’s Changing: Part of the allocated funds will go toward continuing education programs for healthcare professionals, specifically to improve their understanding of Health Technology Assessment (HTA). By deepening professionals’ knowledge of HTA, Spain aims to ensure that drug evaluation and therapeutic positioning are guided by evidence-based practices.
• Impact: For pharmaceutical companies, this initiative means greater scrutiny of drug effectiveness and cost-effectiveness, especially as healthcare providers become more proficient in HTA principles. Payers may also benefit, as a well-informed healthcare workforce can make better use of resources, potentially lowering overall costs.
2. De-prescription of Unnecessary Drugs and Promotion of Preventive Care
• What’s Changing: The initiative will also fund programs aimed at de-prescribing unnecessary medications to reduce healthcare costs. Alongside this, Spain is placing a stronger emphasis on preventive care, which not only improves patient outcomes but also curtails spending on unnecessary treatments.
• Impact: For pharma, this push towards de-prescription may affect demand for certain drugs, particularly those deemed low-value or non-essential. However, it also presents an opportunity to align with Spain’s focus on value-based care, potentially promoting medications that are supported by strong evidence of efficacy. For payers, preventive care investments mean a healthier population with fewer costs linked to chronic diseases, reducing the financial burden on the healthcare system.
3. Supporting Innovation Through Therapeutic Positioning Reports
• What’s Changing: Another portion of the funding will support the consolidation of therapeutic positioning reports. These reports will help evaluate and position drugs more effectively within the healthcare system, ensuring that innovative treatments are assessed rigorously before they reach patients.
• Impact: Pharmaceutical companies may see a more streamlined and transparent pathway for introducing new drugs to the Spanish market. This approach promotes fair competition and emphasizes innovation, aligning with Spain’s broader goals of delivering cost-effective, impactful healthcare solutions.
How Lyfegen’s Solutions Can Support Your Strategy
1. Agreements Library: Lyfegen’s Agreements Library provides access to an extensive collection of value-based agreements that can help pharma companies align with Spain’s focus on cost-effective treatments. This resource allows pharma to explore agreements and pricing models suited to Spain’s HTA-driven environment, improving the chances of successful market access.
2. Drug Contracting Simulator: With the Drug Contracting Simulator, stakeholders can simulate pricing models that reflect Spain’s emphasis on evidence-based evaluation. By assessing various pricing scenarios and outcomes, pharma companies can design agreements that align with Spain’s value-based healthcare priorities, supporting successful negotiations and reimbursement strategies.
Conclusion
Spain’s recent investments in HTA education, de-prescription, and preventive care reflect the country’s commitment to a sustainable, efficient healthcare system. For pharmaceutical companies and payers, these changes highlight the need to align market access strategies with Spain’s goals of evidence-based care and cost containment. Lyfegen’s Agreements Library and Drug Contracting Simulator offer essential tools to navigate these shifts, enabling stakeholders to create outcome-driven agreements that support Spain’s healthcare objectives.
Book a personalized demo today to see how Lyfegen can empower your market access strategy in Spain’s evolving healthcare landscape: https://www.lyfegen.com/demo
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