Seeing The Woods

And

The Trees

Capturing All of the benefits of new technologies

Recently, the Institute for Clinical and Economic Review (ICER), a privately funded organization that attempts to calculate the economic value of new drugs for payers, released an assessment of tafamidis, the first disease modifying treatment (DMT) for a rare cardiovascular disorder called transthyretin amyloid cardiomyopathy (ATTR-CM)¹. In the report, ICER highlights an important ‘system’ effect of introducing a new treatment for a previously untreatable condition; the fact that its introduction has a direct effect on the incentive to diagnose that condition. Yet there is no attempt to incorporate this added value into its assessment.

It has been consistently discussed in the literature, ^2,3 and highlighted by multiple stakeholders in the ICER report itself, that the introduction of tafamidis has led to a much-improved rate of diagnosis of ATTR-CM. This, in conjunction with the fact that earlier detection leads to improved care, results in a systematic benefit accrued to all ATTR-CM patients because of the development of DMTs that is realized irrespective of whether these patients receive that drug or not.

Quite the opposite, in fact in this same report, ICER tries to make the case that because patients are being diagnosed earlier – at less severe stages of disease –that the net benefit of treatment could in fact be smaller than was seen in the trials for tafamidis⁵. But this is a circular argument. At the timing of the RCTs, diagnosis was less valued and thus less incentivized precisely because no treatment existed. It is because of this fact that the mean level of severity of a newly diagnosed patient was much worse when the clinical trial was conducted, as at that time no treatment existed for ATTR-CM patients (and consequently this system effect did not exist). This is an accurate reflection of the reality for many new treatments entering markets for which there were no previous care options. However, the issue is that the analysis assumes lower absolute health gain for individuals with lower disease severity without allowing for any credit to accrue to tafamidis for encouraging these individuals to be identified and treated in the first place; ICER wants the health system to benefit from tafamidis’ manufacturer’s innovation without giving it full credit for the subsequent effects. The logical downstream effect of this omission is to disincentivize investment in diseases without any current treatments.

This is a wonderful example of how innovation in drug development is being punished by somewhat short-sighted, rules-based evaluation methods. It is widely agreed that innovation in medicine is essential, and everyone really wants to encourage it. Unfortunately, the very real benefits from system effects such as these, and any effects that cannot necessarily be seen without hindsight, are highly unlikely to be captured in rules-based methods such as those used by ICER, as a) it hasn’t been pre-defined in the methodology, and b) is not a direct benefit accrued solely to the index patient in a closed, static, system of evaluation. These are the sorts if holes that suggest the obvious benefits of moving value assessment further towards a principle-based system of evaluation if the true scope of value of new innovation is to be captured effectively.