Drug Spending % of Healthcare Spending DRUG SPENDING % OF HEALTHCARE SPENDING 20% 15% Japan, 15.0% France, 9.8% 10% US Net, 9.8% UK, 9.7% Germany, 9.0% 5% 0% 1995 2000 2005 2010 2015 France Germany Japan United Kingdom United States Net Source: QuintilesIMS Institute Sep 2016; WHO Global Health Expenditure Database Dec 2016 Chart Notes: Drug Spending from QuintilesIMS Audits of medicine spending and inclusive of all types of products and all channels of distribution, but not reflecting off-invoice discounts and rebates except where referred to as “net”. 54 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
Real Per Capita Drug Spending 1995-2015 1200 REAL PER CAPITA SPENDING 2015 CONSTANT US$ US est net, 974 1000 800 600 Japan, 576 Germany, 508 France, 492 400 UK, 395 200 0 1995 2000 2005 2010 2015 France Germany Japan UK US est net Source: QuintilesIMS MIDAS; QuintilesIMS Institute Sep 2016; Economist Intelligence Unit Sept 2016 55 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
Annual Growth from New Protected Brands 1996-2015 Absolute Growth in 5 Countries of Products <24 mths since Launch, Real 2015 Const US$Bn 30 25 20 15 10 5 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Source: QuintilesIMS MIDAS; QuintilesIMS Institute Sep 2016 56 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
France Composition of Protected and New Brands Expenditure by Drug Class 1995-2015 Protected & New Brands France Top 20 Classes & Others 100% Total Others Blood Coagulation 90% Other Cardiovasculars Antiulcerants 80% Multiple Sclerosis Antiulcerants Nervous System Disorders 70% Dermatologics GI Products GI Products Viral Hepatitis 60% Viral Hepatitis Mental Health Cholesterol Cholesterol 50% HIV Antivirals Mental Health Respiratory Hospital Solutions Antibacterials 40% Antidiabetics HIV Antivirals Respiratory 30% Anticoagulants Antidiabetics Autoimmune Antibacterials 20% Hypertension Anticoagulants Autoimmune 10% Oncology Pain Hypertension Pain 0% Oncology 1995 2000 2005 2010 2015 Source: QuintilesIMS MIDAS; QuintilesIMS Institute Sep 2016 Note: The group of therapies termed “Other Cardiovasculars” includes a variety of drugs for heart failure, heart surgery, and pulmonary arterial hypertension. In this report, cholesterol and hypertension treatments have been reported separately. 57 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
Germany Composition of Protected and New Brands Expenditure by Drug Class 1995-2015 Protected & New Brands Germany Top 20 Classes & Others 100% Total Others Hospital Solutions 90% Immunosuppressants 80% Antibacterials Cough Cold, Incl Flu Antivirals 70% Other Cardiovasculars Nervous System Vaccines Disorders GI Products Viral Hepatitis 60% HIV Antivirals Antibacterials Mental Health Dermatologics 50% Multiple Sclerosis Nervous System Disorders Respiratory Vaccines 40% Mental Health Autoimmune 30% Viral Hepatitis Anticoagulants Hypertension Respiratory Antidiabetics 20% Pain Hypertension Multiple Sclerosis 10% Oncology Anticoagulants Pain 0% Autoimmune 1995 2000 2005 2010 2015 Antidiabetics Oncology Source: QuintilesIMS MIDAS; QuintilesIMS Institute Sep 2016 Note: The group of therapies termed “Other Cardiovasculars” includes a variety of drugs for heart failure, heart surgery, and pulmonary arterial hypertension. In this report, cholesterol and hypertension treatments have been reported separately. 58 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
Germany Cholesterol Volumes Average Prices and Expenditures by Product Type 1995-2015 Cholesterol Real Drug Expenditures Cholesterol Volumes (Standard Units (Euro Mn) Mn) and Average Price Real Euros 1,000 2,500 0.90 € 900 0.80 € 800 2,000 0.70 € 700 0.60 € 600 1,500 0.50 € 500 0.40 € 400 1,000 0.30 € 300 0.20 € 200 500 0.10 € 100 0 0.00 € 0 1995 2000 2005 2010 2015 1995 2000 2005 2010 2015 Standard Units Mn Average Real Expenditure per SU Existing Protected Brands New Protected Brands Brands No Longer Protected Generics Source: QuintilesIMS MIDAS; QuintilesIMS Institute Sep 2016 59 Understanding the Dynamics of Drug Expenditure. Report by the QuintilesIMS Institute.
What payers want … The four evidence categories required by G-BA are: Mortality (OS) 1. Morbidity (symptomatic progress such as pain & 2. SRE, opiate use: documented medication is expected, fatigue, etc.) Patient reported QoL (e.g., FACT measures, SF- 3. 36, and EORTC) Adverse Events 4. Head of G-BA : “Proven added benefit for PRO is a must-have for the success of future submissions!” - August 2013 63
… but does that work for disruptive innovation ? What insurers need to think of : • Innovation needs vision and incentives, it is not stimulated by HTA, price control and fixed budget thinking. • Budget therefore needs to be released outside government systems. AND • The future is about Disease Interception – Genomic profiling è Data è prediction of risk è Personalised prevention of disease – Examples : Pre-prodromal Alzheimers, pre-diabetes, circulating tumor cells. • Therefore new insurance models are needed in both developing and developed countries.
Five predictions about RWE 1. All data in the world will become available to anyone who desires to analyse them. 2. All databases will become richer, better and linked. 3. RWE will become an essential part of Price & Reimbursement negotations. 4. Randomisation within databases will replace RCT’s and registries. 5. Colourful coalitions of patients, payers, academics and activists will take clinical trials out of the industry’s hands.
Dynamic Efficiency And The fallacy of fixed budget thinking
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