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29-31 Oct 2009, Kapadokya, Turkiye

Health Technology Assessment Perspectives and Trends Abdulkadir Keskinaslan, MD, MBA, MPH Market Pricing Director Asia Pac. 29-31 Oct 2009, Kapadokya, Turkiye. Health care spend has reached USD 3.5 trillion in OECD Providers and distributors account for 66% followed by 17% for pharmaceuticals.

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29-31 Oct 2009, Kapadokya, Turkiye

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  1. Health Technology Assessment Perspectives and Trends Abdulkadir Keskinaslan, MD, MBA, MPHMarket Pricing Director Asia Pac 29-31 Oct 2009, Kapadokya, Turkiye

  2. Health care spend has reached USD 3.5 trillion in OECDProviders and distributors account for 66% followed by 17% for pharmaceuticals 70 2005 Revenue, Health Care Industry1 Publicly traded companies Government & Non-profit Share of HC total USD billion (nominal) OECD 10% 5% 2% <1% 3,565 25 343 70 171 66% 17% 47 1,843 2,364 1,797 1,722 Providers/ Distributors Pharma- ceuticals Payors/ PBMs Devices/ Equipment Biotechnology Other Total Note: Includes non-profit hospitals and services and government-owned hospitals and service providers; OECD countries only; 1 Conservative estimates considering only OECD countries 2 Source: McKinsey analysis; OECD, IMS

  3. Demographic transition will be the leading cause of growth in health care spend • Global population ageing – decreasing fertility along with lengthening life expectancy shifting relative weight from younger to older groups • Regional differences in life expectancy at birth are expected to decrease –an interregional gap of about 7 years is expected by 2045-2050, down from approximately 9 years in the period 2025-2030 and from almost 12 years at present 3 Source: Lesthaeghe. 2000; WHO. World Population Ageing 1950-2050

  4. Shift in burden of disease into specialty areas - oncology and neuroscience - will increase demand for services Australia 1993–2023 Source: Carter R. Presented at HTA Workshop in Beijing 2008 Referencing Begg S. 2008 also available at http://www.aihw.gov.au/bod/index.cfm 4

  5. Higher per capita health expenditure for elderly will further increase 9000 8000 Male Female 7000 6000 5000 per capita expenditure 4000 3000 2000 1000 0 0-4 5–14 15–24 25–34 35–44 45–54 55–64 65–74 75+ Australia 2000-2001 Source: Carter R. Presented at HTA Workshop in Beijing 2008 Referencing Data from: AIHW (2005) Health system exp. on disease and injury in Australia, 2000-01. AIHW Cat No HWE 28 5

  6. Health care spend has grown above GDP , Health care spend Percent of GDP, 1960–2006 Growth in percent share of GDP, CAGR Health care spend as percent of GDP 1960 2006 5.1% 15.3% 2.4% 4.9% 11.3% 1.8% 6.0% 10.6% 1.2% 8.4% 3.9% 1.6% Health care expenditure/capita in USD 000, PPP, 2005; 6 Source: Source: OECD Health Data 2008, McKinsey

  7. Health care spend as % of projected GDP will keep growing Australia 2003-2033 % GDP 12.0 10.8 9.9 10.1 9.4 10.0 9.2 9.0 7.9 9.9 8.0 6.8 5.7 7.9 6.0 6.2 5.1 4.0 4.7 2.0 0.0 2003 2013 2023 2033 2043 UoQ/AIHW (All health expenditure, including private sector Inter-Generational Report: Federal Govt expenditure only Productivity Commission (State & Federal Govt – no private expend) Source: Carter R. Presented at HTA Workshop in Beijing 2008 Referencing Data from: Begg S. 2008 7

  8. Health care strategy is all about how you spend your moneyUK is about 5 times more productive than US in managing Type II Diabetes • Disease burden (DALYs) • Per 100,000 population • Productivity* • x5.0 • Diabetes expenditure • USD per diabetic person * Productivity as performance index is calculated as product of DALY and per capita total expenditure on health, normalized with value of US as 1.0. For country X, (DALY*Cost in US) /(DALY*Cost in Country X) 8 Source: WHO GBD Report 2009; International Diabetes Federation - Diabetes Atlas, ADA, NHS

  9. Health Care needs drive changes pricing and value assessment Hypothesis Comments Innovative agreements will become a more common and accepted approach • Innovative pricing models help industry and countries offer access for affordable medicine to appropriate patients • The UK, Australia and Germany are more advance in offering Pricing • Patients are needing to pay more – as full cash payers or in the form of copays – and demanding more • Tends to rewarded adherent patients with services and lower premiums in the US • In Turkey there are growing trends towards contribution to treatment Health care cost will be shifted to patients Reimbursement will be informed by Health Technology Assessment • HTA used to assess the most appropriate population to benefit • Reimbursement can be conditional or increased on the provision of additional evidence • Restriction of reimbursement to subgroups of patients in which the price is justified Assessing Value Comparative effectiveness will be used to evaluate value • Providers may be asked for comparative data even post registration • Cost effectiveness evaluations will take into account all costs, not just those of drugs, providing room for cost-offset arguments 9

  10. Risk pooling empowers budget holders shifting inelastic demand towards elasticity DEMAND CURVE: Inelastic, Unitary Elastic, Elastic, n = -1 Perfectly inelastic demand: changes in the price do not affect the quantity demanded for the good Need for heart for transplant – no matter what the price is a person needs one Relatively inelastic demand: when the change in quantity demanded is less than change in price Need for an antibiotic for a resistant bacteria Price elasticity of demand: responsiveness in the quantity demanded as a result of change in price elastic if consumers will only pay a narrow range of prices – sugar inelastic if consumers will pay almost any price for the product – water Price Inelastic Unitary Elastic Elastic D Budget Impact Quantity ? = Price negotiations through risk pooling helps inelastic demand shifted towards elastic Demand from an insurance fund holder for 100 transplant a year 10

  11. Value Based – Risk sharing pricing framework Financial contracting models • Reimbursement / pricing through financial arrangements • Price-volume agreements • Dynamic benefit schemes (rebate depending on market share targets) • Patient capitation and dose caps • Different reimbursed price depending on patient outcomes • treatment response • treatment outcome Outcomes based models Performance Oriented Models • Different reimbursed price depending on patient sub-groups • by indication • treatment history • risk factors Risk based models Consumer oriented models • Implementing differentiated pricing models by providing direct benefits to patients 11

  12. Innovative Pricing approach help create win-win solutionsUnderlying goal of models similar, but differ in reimbursement price and scheme Financial Contracting Models - Utilization Outcomes Based Pricing Models Risked Based Pricing Models Initial 10% of patients Full response High Risk Next 20% of patients Partial response Moderate risk All others No response Low risk Patient segments Patient segments Patient segments • Price Volume Agreement: e.g. full reimbursement for first 10% of patients, reduced reimbursement for next 20% of patients, no reimburse-ment for all others • Money back guarantee, e.g. full reimbursement for responders, reduced reimbursement for partial responders, no reimburse-ment for non-responders • Reimbursement linked to value and level of risk (e.g. based on diagnostic test) 12

  13. What is TA? • Technology Assessment (TA) is a concept, which embraces different forms of policy analysis on the relation between science and technology on the one hand, and policy, society and the individual on the other hand. Technology Assessment typically includes policy analysis approaches such as foresight; economic analysis; systems analysis; strategic analysis etc. TA could make policy analysis about: The energy situation Privacy in e-government Globalisation and labour market competences Working conditions in the light of increasing ICT work Potential of nanotechnology in health care GMO and environment • Technology Assessment has three dimensions • The cognitive dimension - creating overview on knowledge, relevant to policy-making • The normative dimension - establishing dialogue in order to support opinion making • The pragmatic dimension - establish processes that help decisions to be made • And TA has three objects • The issue or technology • The social aspects • The policy aspects 13 Sources:http://www.eptanetwork.org/EPTA/what.php

  14. From TA to HTA • 1967 - Technology Assessment first used in the Subcommittee on Science, Research, and Development of the House Science and Astronautics Committee of the U.S. Congress • 1972 - the U.S. Congress created the The Office of Technology Assessment (OTA) by Public Law 92–484. OTA provide analysis of the complex scientific and technical issues from 1972 to 1995 • 1987 - Scientific Technology Options Assessment (STOA)-an official organ of the European Parliament – started releasing reports partnering with external experts. • 1990 - The European Parliamentary Technology Assessment Network-EPTA was formally established under the patronage of the President of the European Parliament to advise parliaments on the possible social, economic and environmental impact of new sciences and technologies. E.g. Working in future - structures and trends in industrial work , Vaccine capacity in the UK. • In 1973-1975 roots of Health Technology was established: • the U.S. Academy of Sciences published a report that examined the implications of four health technologies: in vitro fertilization, choosing the sex of children, retardation of aging, and modifying human behavior • The National Institutes of Health carried out a rather comprehensive assessment of the totally implantable artificial heart in 1973 • The Swedish Organization, Spri, carried out a cost-effectivenessanalysis of the computed tomography (CT) scanner (the first HTA outside of the US) Sources: Banta. 2009; www.eptanetwork.org/EPTA/about.php; www.europarl.europa.eu/stoa/default_en.htm 14

  15. Health Technology Assessment is a tool for Decision Making and Priority Setting at Given Resources Policies no longer focused solely on cost-containment, but achieving value for money Health Technology Assessment - HTA • HTA studies the medical, social, ethical, (legal) and economic implications of development, diffusion and use of technology and informs policy decision • Its aim is to improve quality and cost-effectiveness of healthcare Health Technology • Health technology covers any method (intervention) used to promote health, prevent and treat disease and improve rehabilitation or long-term care Pharmaceuticals Medical Devices Surgical procedures Rehabilitation Programme Preventive Programme Health Services and Health Systems 15 Sources: Adapted from http://www.singhealth.com.sg/

  16. Criteria for HTA varies based on country perspective 16 Sources: Sorenson 2008

  17. Increasing interest in HTA across Asia Pacfollowing trends in the US and EuropeFormal HTA programs Country – HTA HTA Body since Australia – MSAC, PBAC • Non-Pharmaceuticals - the Medicare Services Advisory Committee (MSAC) since late 1998 • Pharmaceuticals - the Pharmaceutical Benefits Advisory Committee (PBAC) Mandatory economic evaluation since 1993 • The Australian Safety and Efficacy Register of New Interventional Procedures—Surgical (ASERNIP-S) since 1998 • HTA at state government level within public hospitals New Zealand – NZHTA • New Zealand Health Technology Assessment (NZHTA) since 1997 • An agency of the National Health Insurance (NHI), the Health Insurance Review and Assessment Service (HIRA) is responsible for working-level benefit determination since 2000 • HTA Center within HIRA was tasked to perform HTA in 2007 • Plans to introduce new national independent organization for HTA and based on the model of the NICE of the UK South Korea – HIRA Thailand – HITAP • Health Intervention and Technology Assessment Program (HITAP) was established in 1996 • HTA is actively used for policy decisions • Center for Drug Evaluation (CDE) - HTA division since 2007 Taiwan – CDE 17 Source: Hailey D. 2009; Sivalal S. 2009; Chang-yup Kim, 2009; Teerawattananon Y. 2009

  18. Key Principles for the Improved Conduct of Health Technology Assessments for Resource Allocation Decisions From Future Trends Workshop 2008-2009 • The goal and scope of the HTA should be explicit and relevant to its use • HTA should be an unbiased and transparent exercise • HTA should include all relevant technologies • A clear system for setting priorities for HTA should exist • HTA should incorporate appropriate methods for assessing costs and benefits • HTAs should consider a wide range of evidence and outcomes • A full societal perspective should be considered when undertaking HTAs • HTAs should explicitly characterize uncertainty surrounding estimates 18 Source: Sullivan S. Future Trends Workshop, Seoul 2008, Singapore 2009, Drummond 2008

  19. Key Principles for the Improved Conduct of Health Technology Assessments for Resource Allocation Decisions • HTAs should consider and address issues of generalizability and transferability • Those conducting HTAs should actively engage all key stakeholder groups • Those undertaking HTAs should actively seek all available data • The implementation of HTA findings needs to be monitored • HTA should be timely • HTA findings need to be communicated appropriately to different decision makers • The link between HTA findings and decision making processes needs to be in all transparent and clearly defined Michael F. Drummond University of York, J. Sanford Schwartz University of Pennsylvania, Bengt Jonsson Stockholm School of Economics, Bryan R. Luce United BioSource Corporation, Peter J. Neumann Tufts University, Uwe Siebert UMIT—University for Health Sciences, Medical Informatics and Technology, Sean D. Sullivan University of Washington; International Journal of Technology Assessment in Health Care, 24:3 (2008), 244–258. 19 Source: Sullivan S. Future Trends Workshop, Seoul 2008, Singapore 2009, Drummond 2008

  20. Key Principles for Improved Health Technology Assessment: Identify and inform organizational, procedural and methodological best practice Australia (PBAC), Brazil (ANVISA), Canada (CADTH), Germany (DAHTA@DIMDI, IQWiG), Korea (HIRA), Sweden (TLV, SBU), Taiwan (CDE), the United Kingdom (NICE), and United States (Blue Cross/Blue Shield, CMS, DERP, Wellpoint). • Many of the organizations support and implement certain principles, such as being explicit about their HTA goals and scope; considering a wide range of evidence and outcomes; and seeking all available data • Other principles, such as taking a full societal perspective; having a clear system for setting priorities; explicitly characterizing uncertainty surrounding estimates; monitoring the implementation of HTA findings; and considering the generalizability and transferability of results receive much less backing • There is also variation in the degree to which organizations incorporate appropriate methods for assessing costs and benefits 20 Source: Sullivan S. Future Trends Workshop, Singapore 2009; Neumann 2009 accepted for publication

  21. HTA systems: room for improvement • HTA’s role and utility in decision-making and priority-setting of health care systems and impact on innovation • Risk of using HTA as a cost-containment measure • HTA governance including transparency, accountability and stakeholder involvement in the HTA process • Stakeholder agreement on methods, evidence requirements and cost-effectiveness thresholds employed during the assessment process • Delays in the HTA process restricting patient access to treatments 21

  22. Discussion pointsIssues? Resources? Knowledge Networks? • Despite the fact that Turkey is advanced on the equity dimension in Health Care, HTA has been relatively slow in gaining much of a foothold. What are the factors that play role in this? Political support? Capacity? Investment? • How to speed up capacity building in Turkey? Human resources? Resources in general? Network? What should be the role for stakeholders in capacity building? • What is the potential value of Information Centers and Knowledge Networks? 22

  23. Information Centers and knowledge networks for HTAcan accelerate collaboration • International Network of Agencies for Health Technology Assessment (INAHTA) • Accelerate exchange and collaboration among agencies • Promote information sharing and comparison • Prevent unnecessary duplication of activities. • HTA on the net; A Guide to Internet Sources of Information from Institute of Health Economics is a toolkit with links • specialized bibliographic databases relevant to the subject of the assessment; • data from government and regulatory agencies; • administrative databases; • industry studies, and advice from experts in the field • NHS Economic Evaluation Database (NHS EED): published economic evaluations of health care interventions Source: http://www.inahta.org/HTA/ http://www.ihe.ca/publications/library/2008/health-technology-assessment-on-the-net-10th/ 23

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