Market capitalism in cancer pharmaceuticals.
e18295 Background: How can health technology assessments be deployed in a market-based healthcare system to improve value and sustainability? Methods: The pan-Canadian Oncology Drug Review (pCODR) is an evidence-based, cancer drug review process that guides formulary decision-making. As of 1/1/17, data from all 98 reviews and economic guidances were abstracted for price of medication, total health care cost per patient, cost-utility provided by the submitter and re-analysis by pCODR. Regression analysis identified correlations. Expected use of therapy was estimated employing data from the Canadian Cancer Society. An optimal formulary was developed, optimizing value for money. Results: Of the 98 reviews, 13 were not finalized, 3 were withdrawn, 1 was suspended. 4 reviews were excluded since the base-case was ambiguous. The median drug price per 28-day cycle was $7,567 (range $2,800-$18,435), with no annual difference from 2012-2016 (p = 0.49). The median best-estimate of cost-utility was $190,858/QALY (IQR $125,585/QALY) with a median net increase in health system cost of $62,771/patient (IQR $89,260) and 0.48 LYG/patient (range 0.04-2.43). Cost per 28-day cycle was a weak predictor of value (R² = 0.02, p < 0.01), and not of health system cost (R² = 0.14, p = 0.06). Funding all efficacious medications by a single payer insurance plan in Canada would require $5.91 billion producing 31,705 QALYs, annually. 26% of the cumulative budget would buy 41% of the health benefit, 56% of the budget would buy 70% of the effect. Once a budget is determined, new medication would replace drugs of higher cost per QALY. Employing this method increased QALY yield of the budget by 67%, 21%, 15%, and 14% at $1B, $2B, $3B, and $4B, respectively. The formulary turnover would be 66%, 44%, 37%, and 22% at each respective budget level. Conclusions: An optimized formulary requires practical deployment of HTA, the ability to shift resources across budgets, and the ability to continuously renegotiate prices based on incremental value. Future work is needed on publically acceptable divestment methods for lower value pharmaceuticals.