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Thinking about the reform of medical insurance payment to help the high-quality development of the innovative drug industry

 Last Update: 2022-11-26
 Source: Internet
 Author: User

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In 2022, the pace of internationalization of innovative drugs in China will further accelerate.

The main reasons for promoting innovative drug companies to go overseas are that the domestic market is not as good as expected - the domestic innovative payment system is not yet perfect, and product homogenization and other factors
.
Under the complex economic situation, most innovative drug companies generally bear the dual pressure of domestic and foreign markets, facing financing difficulties and breaking arms to survive
.
Improving the payment environment for innovative drugs to stabilize market expectations and guide investment direction is an important measure
to promote the high-quality development of innovative industries.
To this end, the following considerations are proposed:

First, innovation is hierarchical, there are differences in input risk and clinical value, and refined payment policies are needed to support innovation

Innovation is hierarchical, there are differences in input risk and clinical value, and refined payment policies are needed to support innovation

"Innovation leads development" is a national development strategy and has gradually become a social consensus
.
The most important principle of innovation is to be problem-oriented, taking further risks and challenges to solve problems
.
Innovation is hierarchical, and can be divided into original innovation and imitation innovation
according to the main ability.
Different types of innovation solve different problems, face different risks, challenges and value goals
.

Original innovation has great complexity and uncertainty, and its value goal is to provide people with the possibility of choice, which belongs to a high level of innovation
.
According to the global biotechnology industry organization BIO, Informa Pharma Intelligence and QLS jointly released a report that in the past decade (2011-2020), the success rate of 9,704 drug clinical development projects from Phase 1 clinical trials to FDA approval was an average of 7.
9%, and the time required was an average of 10.
5 years
.
Imitation innovation is characterized by follow-up and re-creativity, and its value goal is to provide people with the realism
of choice.
Because these drugs are innovative based on the original drug, some uncertain risks
are excluded.
Taking targeted drugs as an example, the mechanism of action of effectively verified targets is clearer, and the development of such targets is more successful
.

Original innovation has great complexity and uncertainty, its value goal is to provide people with the possibility of choice, imitation innovation is characterized by follow-up and re-creativity, its value goal is to provide people with the reality of choice
.

As an exploratory practical activity, original innovation will face market risks
after making technological breakthroughs.
Innovation is not sustainable
without commercial success.
For innovative drugs, the core of their value is to meet the unmet needs of the clinic
.
If pricing and payment policies cannot match value, it will also affect the motivation and goals
of innovation subjects.

Second, how the national basic medical insurance can realize the payment and reimbursement of high-value innovative drugs

How the national basic medical insurance realizes the payment and reimbursement of high-value innovative drugs

Since its establishment in 2018, the National Health Insurance Administration has relied on the strategic purchasing advantages of the pharmaceutical market, practiced the value-based negotiation concept, and carried out negotiations on the access of the national medical insurance drug list, and a total of 250 innovative and life-saving drugs have been added to the catalog through negotiation, playing a significant role
in reducing the drug burden of patients and promoting the accessibility of innovative drugs.

There is an urgent need
for more original innovative drugs, rare disease drugs, CAR-T and other high-value products to be included in the medical insurance reimbursement catalog.
If innovative drugs are not covered by medical insurance due to price issues, they cannot be widely used in clinical trials and cannot reflect their value; Even in the international mature market, the payer and the pharmaceutical company are constantly playing the game of value to achieve the balance between supply and demand, and China is in the initial stage
of pharmaceutical innovation and development.
With the proof of time and the accumulation of experience, China's medical insurance payment is bound to enter the stage
of refined management.

How to form a relatively reasonable price, in the international market, innovative access models (MAAs) such as risk sharing agreements based on value theory have been carried out and implemented
in different countries.
There are three types of payment access, namely simple discounts for drugs based on volume-price relationships, payment agreements based on performance results (where the ineffective portion is borne by the enterprise), and evidence-based conditional payments (CED).

Among them, CED payment agreement is a temporary agreement, usually the medical insurance party first reaches a payment agreement with the pharmaceutical company, requiring the company to collect real-world data within a certain period of time to prove its value, before it can obtain premium payment and final reimbursement qualification
.

For example, CEPS, a French professional health economic assessment agency, reached a CED agreement with a company on the payment of long-acting injectable risperidone, and the company needs to carry out a 2-year real-world study of the drug to prove the clinical advantages of the product, and until the efficacy proof data, the payment price is mainly
based on the lowest price of the reference drug.
After 2 years of research, the clinical advantages and therapeutic effects of the drug have been effectively confirmed, and the medical insurance has also given it a premium approval
.

This flexible innovative access and pricing model provides a reference
for China to establish a value-based innovative drug evaluation system.
While the medical insurance industry is developing with high quality, how to establish a reasonable drug pricing mechanism and payment system, balance the pressure of medical insurance and industrial innovation, and guide the high-level innovation and development of the industry is worth in-depth exploration and consideration:

First, value determines price, and it is necessary to establish a unified understanding
of value.
The value of innovative drugs is the main basis for pricing, payment and clinical use decisions, and China has not yet established a unified and consensus value definition and evaluation system
.
Especially when a new drug is on the market, it may not be officially commercialized, there is a lack of reference standards and basis, and the payer prefers to significantly lower the price from the cost price consideration; Medical institutions believe that the existing clinical protocol is sufficient to meet clinical needs, and the added value of new drugs is safe and uncertain, reducing the willingness to use, while enterprises believe that the negotiated price is much lower than the clinical value
of drugs.

First, value determines price, and it is necessary to establish a unified understanding
of value.

The second is to establish a value-based drug pricing system
.
In recent years, the participation rate of basic medical insurance has remained stable at more than 95%, the future development space has been very limited, there is greater fund security and operating pressure, therefore, drug prices have always been the focus of basic medical insurance drug management, whether it is centralized procurement or medical insurance negotiation, the purpose is to squeeze out the price moisture of the stock
.

The second is to establish a value-based drug pricing system
.

With the continuous improvement of the negotiation and adjustment mechanism of innovative drugs, including the formal introduction and application of health technology assessment in 2017 to provide effective support, the National Health Insurance Administration can measure the ceiling price of drugs, enterprises can measure the floor price of drugs, and then the two play a win-win price in this range, thereby forming a reasonable price, achieving the balance of supply value and demand value, and the underlying logic
of "price for volume" has been realized.

The third is to establish a market-based and reasonable pricing mechanism
with payment standards as a means of regulation.
In order to form a reasonable price mechanism, in addition to ensuring the safety of the operation of the fund and the affordability of patients, we should also consider the encouragement of innovation, and it is necessary to use the market mechanism to form competition and incentives
for innovation.

The third is to establish a market-based and reasonable pricing mechanism
with payment standards as a means of regulation.

Taking the public documents of the Beijing Medical Insurance Bureau as an example, the medical insurance payment standards and implementation requirements for 27 drugs are clarified, and for the national medical insurance negotiation drugs (Danhong injection, compound amino acid injection, aspartate ornithine granules), the national negotiated price will be used as the medical insurance payment standard for pilot drugs, and the patients use drugs with a price higher than the medical insurance payment standard, the part exceeding the medical insurance payment standard shall be borne by the patient himself, and the part within the medical insurance payment standard shall be shared
by the patient and the medical insurance fund according to the policy.

The fourth is to establish a payment system
for innovative drugs that conforms to national conditions.
Innovative drugs do need to establish a value-worthy evaluation system, and at the same time, a payment system that meets national conditions needs to ensure the accessibility and affordability
of high-value innovative drugs by the public.
Basic health insurance has limited financing sources, and it is not practical
to immediately include innovative drugs with high value or unclear evidence of value in the scope of medical insurance reimbursement.
In the context of China's establishment of a multi-level medical security system, it is also necessary to give play to various supplementary insurance, commercial health insurance and other ways to share the pressure
of the fund.

The fourth is to establish a payment system
for innovative drugs that conforms to national conditions.

In October, the National Health Insurance Administration mentioned in its official website response to the NPC deputies' suggestions that in the future, the Health Insurance Administration will work with relevant departments to accelerate the development of health insurance, support the development of health products linked to medical insurance, and expand the scope of protection to promote the access and use
of innovative drugs.

In the context of domestic and international dual circulation, enterprises determined to lead local innovation and development will face cruel international competition, bear the same R&D costs and investment risks as multinational pharmaceutical companies, and need more improvement and support for the drug payment environment!

Policy Research Center, China Association for the Promotion of Pharmaceutical Innovation

Author: Liu Ziyu Assistant Researcher liuzy@phirda.
com

Review proofreader: Zhang Zhijuan, Liu Fapeng

Resources:

1.
Li Xiaopei.
Analysis on the Difference between Original Innovation and Imitation Innovation[J].
Wei Shi,2008(11):40-42,46.
DOI:10.
3969/j.
issn.
1004-1605.
2008.
11.
010.

2.
Chen Yi, | the first release of the research report: From the international experience of innovative MAA, talk about the risk management of medical insurance reimbursement of high-value innovative drugs

https://mp.
weixin.
qq.
com/s/84r9SUemyCrKpEkmA8j1-w

3.
Notice of the Beijing Municipal Medical Security Bureau on the pilot work of medical insurance drug payment standards

http://ybj.
beijing.
gov.
cn/zwgk/2020_zcwj/202205/t20220506_2703125.
html

4.
The birth of innovative drugs - it takes 10 years, costs 1 billion US dollars, and has a success rate of less than 10%

https://mp.
weixin.
qq.
com/s?__biz=MzA4MTgyMTA3OQ==&mid=2650415212&idx=1&sn=27e00c096419316e59095954effdc6b2&chksm=8781ac94b0f62582051c7ae3784c4836bd875f9f6dd0a196217c143788cca30a020cf7140193&scene=27

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