Sponsored Insight
By Nathan Sigworth
As we understand more about the science of cancer, we are seeing new innovative treatments coming out of R&D pipelines. These new drugs attack cancer through one mechanism of action, or another, or multiple.
With every cancer — and every patient — unique, as our treatments become more targeted, so do their effects on patients and tumors. One drug may be extremely effective in a particular type of cancer in a specific individual; that same type of cancer in a different patient may be less affected by the same treatment.
Market access arrangements between pharma companies and payers have tried to keep up with this innovation in recent years through “managed entry agreements,” where treatment is approved at a specific price for a specific patient population and/or cancer type. Simply put, a managed entry agreement (MEA) is an agreement between pharma and payer for a therapy for a specific use case, population, or need, with particular pricing provisions.
You’re probably thinking, it’s 2021; why are these managed entry agreements so tricky to do? Shouldn’t it be reasonably straightforward for pharma and payers to agree on pricing?
Well, it’s become increasingly complicated because they are manual, one-off processes that require time-consuming administration. These lead to suboptimal agreements, no agreement at all, and gaps in patient access to the most innovative therapies. It gets even more complicated when each has pricing agreements with caveats, typically for expensive drugs that are only cost-effective for a specific situation.
Ultimately, we need a specific arrangement for each unique patient and how the treatment would affect that patient, and these MEAs have been the standard. But, they are time-consuming to administer, negotiate, and by definition, are limited; they may only cover a specific situation, leaving other situations uncovered.
As (fingers crossed) we will have a complete Covid-19 vaccine rollout within the next six to 12 months, we will soon need to remove our heads from the collective Covid fog and remember that cancer and other types of diseases haven’t gone away.
On the contrary, they’ve likely substantially increased during this time due to neglected checkups and screenings. At the same time, decision-makers and negotiators have become increasingly busy. And with pipelines chock full of even more incredible science, this situation won’t be slowing down anytime soon.
What we will have is the following:
1. Patients are going to need faster and increased access to the latest innovative therapies for treatment.
2. Pharma will need to be able to negotiate with payers effectively, so the many, many billions of dollars they’ve spent on getting drugs developed and approved is worth it.
3. Payers are going to need to ensure they are effectively helping get these treatments to the public.
With the value of treatments varying across indications and populations, only a small portion of patients receive treatment today through imperfect coverage by MEAs.
But the good news is, the tailwinds that traditionally made managed entry agreements challenging are starting to change for three main reasons:
1. Better data availability: Historically, there has been a massive lack of data for both pharma and payers to use when considering how they negotiate, and on what dimension they negotiate on, and reimbursement strategies. In the last few years, companies like Lynx, IQVIA, HealthSolutions, and Guardtime have made tremendous progress on this front. Now, there are incredible opportunities for improved data sources to make more informed negotiation decisions.
2. Improved technology solutions: The incredibly talented professionals involved in managed entry agreements have been working for years with outdated tools, spreadsheets, and one-off conversations. There is a new crop of software tools being built that simplify and add structure to executing and administering managed entry agreements.
3. Greater need: With many people neglecting their health amidst the Covid-19 pandemic, we anticipate an unfortunate long-term impact of a growing number of treatments needed for people diagnosed with cancer and other similar types of diseases. The sheer volume of MEAs that will be in the pipeline will help shape the thinking around how scalability.
It’s similar to as if we were still buying airline tickets in the same way we were 30 years ago. Imagine calling up the airline, asking what they have available, waiting for pricing, etc., rather than going online and finding everything out quickly and easily. In a win for the good guys, new technology and venture capital money offer better solutions. Besides my work at PharmaCCX, many big pharmaceutical companies and payers are investing in their digital platforms to solve this challenge.
Pharma associations and payers are also spending time thinking about how to solve this challenge. For instance, NICE in the UK has publicly expressed their support of ABPI, the local association, in their efforts to solve this problem, especially for combination and indication based agreements.
The confluence of all of these forces makes 2021 the year to truly scale managed entry agreements. We have the increasing pipelines of innovative therapies demanding complex agreements on top of the surging demand from delayed health care during Covid-19 period, coupled with better data sources and improved technology solutions.
We all have a fiduciary and moral responsibility to make sure we are doing all that we can to ensure we are making managed entry agreements as scalable as possible for the benefit of patients and our other stakeholders.
About the Author
Nathan Sigworth is CEO of PharmaCCX — an independent, third-party technology platform working with payers and pharma to help increase patient access to promising therapies.