Pricing methods in outcome-based contracting: δ6: adherence-based pricing

Figures & data

Figure 1. Five-step method for estimating paybacks to support adherence programs. Abbreviations. t, time of contract, RCT, randomized controlled trial, RWD, real-world data; MCS, Monte Carlo Simulation.

Figure 2. Hypothetical example of a deterministic curve for drug A, with by lower and upper curves.

Figure 3. Hypothetical example for estimating efficacy probabilities for 1-year contracting.

Table 1. Model inputs.

Parameter	Estimates	Reference
OS (osimertinib)	OS K-M curve	^17
PFS (osimertinib)	PFS K-M curve	^17
Osimertinib price^a	$14,616	^16
Inputs for the hypothetical outcome-based contracts
Medical Inflation rate projected for 2019–2020	0.44%	^14
Medical Inflation rate projected for 2019–2021	0.72%	^10

^aThe price of osimertinib is based on the wholesale acquisition cost (WAC) of a 30-day prescription in 2018 US dollars.

Abbreviations. OS, overall survival; PFS, progression-free survival.

Figure 4. Overall survival (OS) Weibull upper, deterministic, and lower curves.

Figure 5. Progression-free survival (PFS) Weibull upper, deterministic, and lower curves.

Table 2. Equations used to predict mean, lower, and upper Weibull curves for overall survival (OS).

	Mean Weibull	Lower Weibull	Upper Weibull
Osimertinib OS Weibull
Mean OS curve	OS(t) = exp (–λd × t ^ γd)
Lower OS curve		OS(t) = exp (−λU × t ^ γU)
Upper OS curve			OS(t) = exp (– λL× t ^ γL)

Abbreviations. OS, overall survival; λd, λL, and λU, mean, lower, and upper scale coefficients, respectively; γd, γL, and γU, mean, lower, and upper shape coefficients, respectively; t, time.

Table 3. Equations used to predict mean, lower, upper Weibull curves for progression-free survival (PFS).

	Mean Weibull	Lower Weibull	Upper Weibull
Osimertinib PFS Weibull
Mean PFS curve	PFS (t) = exp (–λd × t ^ γd)
Lower PFS curve		PFS (t) = exp (−λU × t ^ γU)
Upper PFS curve			PFS (t) = exp (–λL× t ^ γL)

Abbreviations. PFS, progression-free survival; λ_d, λ_L, and λ_U, mean, lower, and upper scale coefficients, respectively; γ_d, γ_L, and γ_U, mean, lower, and upper shape coefficients, respectively; t, time; HR, hazard ratio; SOC, standard of care.

Table 4. Probability and differential estimates.

	1-year contract estimates		2-year contract estimates
	Mean, Lower, Upper	Differential (Upper–Mean)	Mean, Lower, Upper	Differential (Upper–Mean)
OS-based Weibull	0.91, 0.76, 0.97	0.06	0.72, 0.35, 0.91	0.18^a
PFS-based Weibull	0.71, 0.35, 0.89	0.18	0.23, 0.01, 0.64	0.41^a

^aThe mean differential estimated for the 1-year contract is added to the 2-year estimates for 2-year contracting.

Table 5. Adherence-based pricing for 1-year contract (2019–2020) and 2-year contract (2019–2021).

Adherence-based pricing	1-year contract (2019–2020)^b	2-year contract (2019–2021)^c
Based on OS
Upper price reductions (−6.00% for 1-year contract; −18.00% for 2-year contract)	$13,835	$12,054
Lower price reductions (0%)	$14,680	$14,721
Based on PFS
Upper price reductions (−18.00% for 1-year contract; −41.00% for 2-year contract)	$11,997	$8,724
Lower price reductions (0%)	$14,680	$14,721
Average price (SD)	$13,798 ($1,265)	$12,555 ($2,847)
DSPAdherence (% price adjustment)^a	$13,785 (−5.69%)	$12,582 (−13.92%)

^aPrice adjustment to 2018 WAC price for 30-day prescription of osimertinib.

^bInflation rate in 2019–2020 was projected at +0.4395833% but rounded to +0.44% for reporting.

^cInflation rate in 2019–2021 was projected at +0.71875% but rounded to +0.72% for reporting.

Abbreviations. OS, overall survival; PFS, progression-free survival; SD, standard deviation; DSP_adherence, Dimension-specific price in dimension 6.

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