‘Economic Evaluation of Health

Technologies in France: from

Theory to Practice

Lise Rochaix, Ph.D Professor at the economics department of AMU (Aix-Marseille

University) and member of GREQAM (Groupe de Recherches

Quantitatives d’Aix-Marseille), former member of HAS board.

CHE Seminar Series, February 6th, 2014

The author declares

having no conflict of interest

2

3

In their 1983 paper on Regional allocation of health

care resources in the UK and France, Alan Maynard

and Ann Ludbrook regarded France as ‘le mauvais

élève’ (the last of the class) for health care expenditure

management*. The purpose of the presentation is to

assess whether this still holds today. To address the

question, the seminar will draw on the recent

experience of the French National Health Board (HAS

–Haute Autorité de Santé-), which was given legal

remits in 2008 and 2012 to carry out economic

assessments of health care technologies and

interventions. The obstacles encountered in the process

of setting up the new efficiency advices on pricing for

new technologies will be reviewed, as well the

prospects for further developments in the use of

economic analysis for decision-making in health care

in France.

* Social policy and administration, vol. 17, number 3

01

The context

4

The ‘open-ended’ funding approach

Rather than define priorities and make explicit choices, France has, over the past 30 years:

1 – expected that growth would generate enough value to

finance increasing needs

2 – assumed that waste could be reduced and would match

the growing financial needs ;

3 – reduced other public expenditure (such as defence) for

the benefit of the health care sector

4 – borrowed from future generations by running fast

increasing deficits …

These strategies can no longer be adopted in order to

postpone (or shy away) from choices and priority setting 5

The OECD 2010 shared diagnostic

While no definite answer has been given to the macro-

efficiency’ question of ‘how much is enough’… with

variations in the percentage of GDP spent on health care

All EU countries converge on the need to:

- make limits on health care spending more explicit …

and more binding

- make the best use of available resources (allocative and

productive efficiency)

- Define priorities increasingly based on cost-

effectiveness studies

6

OECD assessment for France

The French health care system shows:

• a generous cover (‘over the basic coverage

performance’ indicator)

• A better than EU average information on quality and

prices

• An ability to set priorities …

Coupled with:

• Limited stringency in the budget constraint

• Little ability to control prices billed by providers

• Restricted levers for insurers (basic coverage) 7

How to reap efficiency gains? The new set of policy indicators provides guidance

8

9

The ‘true’ obstacles to change

• Reluctance to make clear choices (eg the ‘gatekeeping saga’)

which makes implementation difficult

• Lack of recognition of the need to prioritize at national level,

due to doctors’ legal obligation of means

• Fragmentation of professions’ representatives, strong

corporatism and medical power in decision-making

• Exacerbation of the value of freedom of choice compared to

other objectives (equity, efficiency)

• Economics associated with cost containment and rejection of

utilitarianism and Qalys

• Little use of evidence to support public policy definition

• Lack of adequate information systems on which to base

contracting and incentives

10

What is needed:

• Increased governement accountability to Parliament through

greater respect of the national health insurance annual

expenditure target (=> making the constraint on resources

explicit and credible)

• Systematic and robust evaluation of public policy

• Prioritization to ‘verticalize’ the 100 public health priorities

• Use full evidence when assessing health care strategies,

including economics

02

Can HAS help?

A case study on drug

pricing

11

HAS: an integrated approach

1

Assess Medical

Technologies

What does HAS assess?

•Medicinal products

•Medical devices

•Health technologies and

medical procedures

2

Recommend Healthcare

Strategies

What type of

recommendations

does HAS provide?

•Clinical Practice Guidelines

•Public health

recommendations

•Healthcare safety guidelines

3

Act to improve healthcare

quality

What does HAS do?

•Accredit HCOs

•Certify medical practice

evaluations

•Chronic diseases

management

•Provide information and

mediation on adverse

events

•Certify medical

information provision

Integrate medical,

organisational

and economic

factors

HAS ensures high-quality healthcare for all

Define quality

evaluation

criteria for

action

12

Ministry of Health

Haute Autorité

de Sante

Unions of health professionals

Negotiation with

Advice/public health policy

!

Indicative

spending

targets

Pricing

Committee

(CEPS)

PARLIAMENT Votes law and

oversees implementation

Advice/

price

Advice/reimbursement

National health insurance funds

(compulsory and voluntary)

13

In 2011, OECD countries spent on average USD$ 500 per

capita for outpatient pharmaceuticals, or 1.6% of GDP, with

wide variations

1. Includes medical non-durables.

Source: OECD Health Statistics 2013 , http://dx.doi.org/10.1787/health-data-en.

Pharmaceutical expenditure per capita Pharmaceutical expenditure as a share of GDP

Chile

Czech Republic

Norway

Luxembourg

New Zealand

Estonia

Slovenia

Iceland

United States

Canada

Greece ¹

Japan

Ireland ¹

Denmark

Mexico ¹

Spain

Australia

Hungary

Switzerland

Slovak Republic ¹

Austria

OECD31

Italy ¹

Portugal

Korea

Sweden

Finland

Poland

Netherlands ¹

Germany

Belgium

France

178

259

266

272

284

319

325

357

373

419

433

436

443

445

469

479

483

487

500

520

525

531

541

587

615

627

632

648

648

673

701

985

02004006008001000

USD PPP

Total (nobreakdown)

Prescribed

Over-the-counter

0.9

1.7

0.7

1.3

1.0

1.5

0.6

0.6

1.5

1.4

1.7

1.2

1.1

1.5

1.8

1.1

1.5

1.5

1.6

1.3

2.2

1.0

2.6

1.4

1.8

1.6

1.6

1.6

1.9

2.6

1.9

2.1

0 1 2 3 4

% GDP

Public

Private

14

15

Generic market shares vary

widely across OECD countries

35

28 28 24

44

36

17 19

15 18 17

15

23

6

12 9

16

9 8

3

76 75 73 72

70

51

42 41

36 35 34 34 30 29

25 23 21

18 16

9

0

20

40

60

80

Value Volume

%

1. Reimbursed pharmaceutical market. 2. Community pharmacy market.

Source: OECD Health Statistics 2013

HTA guidance

CEPS Economic Committee for

Healthcare Products

L I S T I N G

Decision

Price

Pricing and reimbursement decisions for

a new technology

16 16

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• Primarily based on added therapeutic value assessement (ATB)

by HAS transparency committee (CT)

• Two types of instruments to contain drug expenditure

– Price setting together with volume contracting, using clawback

payments in case of overshooting

– Restrictions on target population

• A hybrid between

– an international reference pricing system for drugs with

major to moderate added therapeutic benefit (ATB=1,2,3)

– An additional therapeutic assessment system for ATB =4

– An internal reference pricing system (using price of national

comparators) for ATB =5

The French drug pricing system

17

Clinical aspects

• clinical efficacy

• clinical effectiveness

• relative effectiveness

Other aspects

• disease characteristics

• target population

• impact on public health

Thera.

Benefit

‘TB’ Sufficient

Insufficient

Added

Therap.

value

‘ATB’

No ATB(5)

Minor

ATVB (4)

No reimbursement

Reimbursement

only if price inferior

to comparators

‘European’ Price

Dimensions Criteria Results

P

R

I

C

I

N

G

HTA: HAS Guidance Decision: Ministry

Pricing:

Economic Committee

Initial listing: From HAS guidance to CEPS pricing

Price may be

higher than

comparators

High to moderate

ATB(1,2,3)

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18

CEPS pricing rules

Balancing objectives

Optimal use of limited healthcare resources

Public health promotion

Innovation support

Decision tree /Added Therapeutic Value (ATB)

• Major to moderate ATB (1 to 3): eligible for faster access at a

European price (Price notification in place of negotiation)

• Minor ATB (4): individual firm price/volume agreement

• No ATB (5): price lower than comparators by Law

Additional criteria

• Competitors’ prices in same therapeutic indication

• Forecast or recorded sales volumes

• Expected and/or actual conditions of use 19

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The French drug pricing system relies on an assessment of the

added therapeutic benefit by the transparency committee, based

on individual clinical benefits

– The added value to society (social value) is not addressed

per se

– The other price determinants (among which, industrial

considerations) are taken into account by the French

pricing committee (CEPS) but there is no decision

traceability (confidential agreements)

From therapeutic added benefit …

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… to collective added value

To be truly ‘value based’, pricing has to rely on the explicit and

quantitative assessment of all the individual and collective value

determinants

=> Additional elements must be documented, beyond the

measurement of therapeutic added benefit (relative

effectiveness):

• Efficiency gains measurement (both expected and effective)

• Organizational impacts

• Social values

=> The steps towards including economics into HAS advice

• Role of economic analysis strengthened for public health

and clinical practice guidelines

Screening, type 2 diabetes, …

• Cost-effectiveness analysis for class reassessment (at most

within 5 years) with possible impact on price

Statines, stents, ..

• For some technologies, full HTAs (inc. ethics and social

values)

Growth hormones for non deficient children

50 economic assessments produced as well as

methodological guidelines for economic assessment

But no economic analysis at first listing

Step 1: The 2008 Law

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Methods

23

23

http://www.has-

sante.fr/portail/jcms/r_1499251/fr/choi

x-methodologiques-pour-l-evaluation-

economique-a-la-has?xtmc=&xtcr=1

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Methodological guides

1 – Methods for public consultation

2 – Choices in methods for economic

evaluation at HAS

3 – Integration of ethical dimensions in HAS

guidance

4 – joint diagnostic tests and treatments (work

in progress)

• Time frame for first listing advice:

=> Can we do it in 90 days?

• Added therapeutic benefit not assessed

• => Can we do it in parallel?

• Price information availability:

- Link between individual drug value and price is

difficult to establish as price negotiation at firm level

- Actual prices differ from facial price through rebates

Can simulations over price ranges be used?

• Strategic interaction between HAS and CEPS:

=> How far can HAS go in documenting all dimensions of

a price decision without locking CEPS in its negotiation?

The challenges for economics at first listing

25

The 2012 Financing law for social security (LFSS 2012) strengthens

the role of HAS in documenting the collective added value

(efficiency) at 1st listing

– HAS’ existing committee (economics and public health

evaluation committee – CEESP) set up in 2008 has now the same

legal status as HAS medical committees for drugs (transparency

committee - CT) and medical devices (CNEDIMTS)

– From 22 to 33 members (various profiles: economics,

ethics/philosophy, other social sciences, patient representatives,

public health specialists, GPs and specialists)

– CEESP is in charge of establishing and disseminating public

health and economic recommendations as well as efficiency

assessments for 1st listings and reassessments

Step 2 – The 2012 Law

26

• The decree specifies that from Oct. 3rd, 2013, firms will have

to submit economic dossiers, based on HAS guidelines, both

for first listing and reassessments (1 year for implementation)

• Two conditions:

i) Only applies for ‘innovative’ drugs and medical devices (ie

for which the firm claims an added therapeutic benefit

(ATB/ASMR) of level 1 to 3 (=>European prices)

ii) The forecasted expenditure must have a significant impact

on the health care budget

• CEESP will produce and publish efficiency guidance for the

pricing committee on expected efficiency within 90 days, in

parallel to the medical guidance

Step 3: The Oct. 2nd, 2012 Decree

27

Added Therapeutic Benefit (ATB) granted by transparency committee

ASMR/ATB 2008 2009 2010 2011 2012

I-II 7 10 4 1 6

III 5 8 8 2 10

% I-III 13 18 14 5 16

IV 17 20 20 20 22

V 48 65 46 29 58

Total number

of advice 75 100 85 58 99

28

28

29

ATB claimed / granted for drugs in 2012

• Added Therapeutic Benefit (ATB) claimed by firms for

drugs:

– ASMR I : 5

– ASMR II : 12

– ASMR III : 20

• ATB given by HAS transparency committee:

– ASMR I : 0

– ASMR II : 6

– ASMR III : 10

=> Potentially between 30 and 40 efficiency advice

produced by HAS for drugs (less for medical devices)

30

What is meant by the second

condition: ‘significant impact’?

• A three way concertation between CEPS/HAS/Industry

representatives (October 2012 – sept. 2013)

• Simulations carried out by HAS to define an entry criterion for a

CE analysis to be provided by firms at first listing

• A joint HAS/CEPS decision (sept. 2013):

– New drugs with expected gross turnover (for a full year) over

20 million € (for all indications) must have a CE analysis on

which HAS will produce an expected efficiency advice

– The firm also briefly documents the expected impact of the

new technology on the health care system

– HAS Board may decide to require a CE analysis if expected

impact is high, even with a turnover is below 20 million

31

From Nov. 3rd, 2013

• CEESP efficiency advice to CEPS for 1st listings

– methodological quality of the economic part of the

application submitted by companies (budget impact

only considered if CE analysis also available

– expected efficiency analysis (based on Incremental

cost-effectiveness ratio – ICER -) together with an

assessment of the robustness of the ratio (sensitiviy

analyses)

– Additional economic data may be requested in post-

listing studies

• Full economic analysis at the time of re-assessment

– ICER calculation

– other price determinants (ethical, sociological, …)

32

32

33

34

HAS assessment process

Economic assessment

Clinical assessment

CEPS

CEESP

CT

CNEDIMTS

35

36

1. Dossier submission

2. Checks / administrative completeness and methodological

adequacy

3. Internal analysis at HAS

4. Optional : HAS request for additional data or

clarifications

5. Draft advice

6. CEESP validation

7. Advice sent to company and pricing committee

8. Contradictory phase + price negotiation

9. Final advice published on website

The 90 days economic evaluation stages

37

• Producing guidance on both clinical and economic dimensions

within 90 days

• Developing early advice to identify relevant data collection for

economic assessment

• Ensuring complementarity between clinical and economic

dimensions by clarifying respective contributions

• Identifying important societal dimensions at first listing through a

check list to ensure full analysis at time of reassessment

• Encouraging use of economics for value assessment (not short

term cost-control) and for all health interventions (not just drugs)

• Taking part in European initiatives (EunetHTA) to encourage

mutualisation of resources

Challenges ahead

38

• HAS’ experience with quantifying the individual documented

and expected magnitude of the technology benefit is of relevance

when considering value based pricing

• The more recent contribution of non-medical disciplines

(economics, sociology, ..) to assessing the collective added value

of technology benefit, in comparison to other strategies, is also

relevant

• Strengthening the link between HAS guidance (based on both

dimensions) and P&R pricing policy may contribute towards a

more transparent assessment of collective value, provided

economics is not used as a rationing tool

Conclusion

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