"The latest beneficiary of healthcare reform to step into the spotlight: Comparative effectiveness. The bill signed by President Obama earlier this week sets up a new institute for head-to-head studies of drugs and devices–and arms it with a $500 million annual budget. That positively dwarfs the $1.1 billion in comparative-effectiveness funding approved by Congress last year."
Source: Fierce Pharma
What's interesting to me about the Obama health care reform law is that tucked away on page 1617 out of 2400 is a measure discussing comparative effectiveness (hat tip to Bloomberg for spotting it). In the short run, the measure won't have much impact, but in the long run, say by 2013 onwards it will start to bite.
This is where savings will start to be made, so if for example, a branded drug doesn't appear to offer much benefit over a generic, then undoubtedly the payers will force dispensing of the generic version and save significant expense in the process.
One thing I had forgotten until sitting through the non-oncology presentations at the recent Roche IR meeting is that most trials compare the new drug to placebo rather than standard comparators, so it will be difficult to compare drug performance in a given class without head to head trials. Of course, in many cases, they are similar and success may well be determined by either being first to market by several years or by creative marketing and positioning.
In oncology, it is more typical to either compare a new regimen to the established standard of care or to add an experimental agent to the standard of care and then compare to the standard alone. In this way, a sense can be gained regarding how well the new drug fits in the existing treatment algorithm.
Thus drugs that do not show significant improvement to the standard of care generally are terminated in that indication or fail to get approval. Brutal perhaps, but it is an effective way to sort the wheat from the chaff. The only time placebos typically appear in oncology trials is in refractory disease where there are no available comparators, so a drug is compared to placebo or best supportive care.
A world apart in drug development.
So what of the future? According to Bloomberg:
"The new legislation creates a nonprofit Patient-Centered Outcomes Research Institute and tasks it with setting a national agenda for the studies, as well as providing more money and disseminating results."
It's going to be an interesting ride for sure and of course, other countries already have comparative effective research built into the approval process, as the UK already does. Ultimately, resources become limited, so it's a choice between having your health care managed by the limitations of the hospital budget (UK) or limited by your ability to pay (US). Either way, choices and options are always rationed to some degree.
One question I'm wondering about is how well prepared are Pharma and Biotech? The big companies are already doing CE research, the little guys? Maybe not so much.
Are you incorporating comparative effectiveness into your strategic and life cycle management plans?