The challenge of value-based pricing in combination therapy: the case of trastuzumab and pertuzumab in HER2+ metastatic breast cancer

ABSTRACT

Background

Under current reimbursement (CR) practice even though an add-on drug in a combination therapy may produce marginal value in terms of health gain, the original therapy may also share in the reward for this additional value. We examine an alternative ‘marginal value-based reimbursement’ (MVBR) model in which an original therapy would not share in the marginal value.

Methods

In a case study for treatment of HER2+ metastatic breast cancer, we computed the incremental cost-effectiveness ratios (ICERs) of adding pertuzumab to trastuzumab and docetaxel (PHT) vs. trastuzumab and docetaxel (HT) under the CR and the MVBR models, respectively. We further estimated the revised cost of pertuzumab under three alternative willingness-to-pay thresholds based on (a) using the current ICER of PHT vs. HT, (b) the historical ICER of HT vs. docetaxel, and (c) applying the oft-used $150,000/quality-adjusted life year (QALY) gained.

Results

If reimbursement were changed from CR to MVBR, at the current price of pertuzumab, the ICER would decline from $409,213 to $323,236/QALY gained. If the price were adjusted under the three thresholds, the payment for pertuzumab would be increased by between 32% and 93%.

Conclusion

The proposed MVBR model would provide a stronger economic incentive to develop add-on drugs.

KEYWORDS:

• Combination therapy
• cost-effectiveness analysis
• pertuzumab
• trastuzumab
• value-based pricing
• indication-specific pricing

Acknowledgments

The authors would like to thank Drs Josh Carlson, Ali R. Khaki and Marita Zimmermann for their insightful comments.

Author contributions

BJ and LG jointly conceived and designed the research project; BJ carried out the modelling analysis and prepared the first manuscript draft; LG revised the manuscript critically. Both authors reviewed and agreed with the final manuscript.

Declaration of interest

LG has conducted previous, related research sponsored by Genentech. The authors have no other relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript. This includes employment, consultancies, honoraria, stock ownership or options, expert testimony, grants or patents received or pending, or royalties.

Reviewers disclosure

Peer reviewers on this manuscript have no relevant financial relationships or otherwise to disclose.

Additional information

Funding

This paper was not funded.