Copyright © 2012 Quintiles

Media Briefing ~ May 17, 2012

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Introduction

WHAT IS THE NHR?• The New Health Report is an annual survey of stakeholders who are involved in or impacted by

drug development. Data received from this year’s The New Health Report was obtained from responses received from biopharmaceutical executives, managed care/payer executives, investors and patients being treated for a chronic illness. Those surveyed for this year’s report were from the U.S. and the U.K.

WHY DID QUINTILES UNDERTAKE THIS ANNUAL SURVEY?• As a global service provider to the biopharmaceutical industry, Quintiles launched The New Health

Report in 2010 to offer perspective and insight into several key topics that are relevant to our customers. Quintiles continues to commission this stakeholder survey in an effort to better understand the dramatic changes that occur within the drug development landscape.

HOW MANY PEOPLE PARTICIPATED IN THE SURVEY?• The New Health Report 2012 is a survey of more than 1,350 U.S. and U.K.-based

biopharmaceutical executives, managed care executives, investors and patients being treated for a chronic illness. The survey included 102 biopharmaceutical; 75 managed care executives in the U.S.; 72 NHS executives; 509 U.S. adults and 500 U.K. adults ages 18+ who were diagnosed with and receiving treatment for a chronic illness; and 100 investment professionals focused on the healthcare/biopharma sector.

Frequently Asked Questions

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John Doyle, Dr.P.H., MPH

BIOGRAPHY• Dr. Doyle has authored over 50 original research articles

in a variety of therapeutic areas. As a health economist and epidemiologist, he has lectured on research methodologies for academic and commercial audiences in the U.S., Canada, Asia, Europe and Latin America. He has consulted global pharmaceutical and biotech firms on strategic concerns regarding product development, pricing, reimbursement, market valuation and other commercialization issues.

• Adjunct faculty member of the Mailman School of Public Health at Columbia University

SELECTED AREAS OF EXPERTISE• Comparative Effectiveness Research (CER)• Rising cost of healthcare• Drugs for orphan indications• Healthcare reform and policy

Senior Vice President and Practice Leader,Commercial and Market Access Strategy, Consulting at Quintiles

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Dean Summerfield, D.Phil., M.A.

BIOGRAPHY• Summerfield has worked with a wide range of

pharmaceutical and medical device companies in engagements from long-term strategy to day-to-day operations that spanned the clinical and commercialisation spectrum across clinical, marketing, market access, medical and sales functions.

• For over 16 years, he has been focused on delivering management consulting solutions to life sciences clients with a proven track record of enabling companies to achieve greater commercial successes and profitable business growth by creating fact-based strategies and enabling their implementation.

SELECTED AREAS OF EXPERTISE• Health Technology Assessments• Market Access• Risk-sharing alliances • Pre-competitive alliances

Vice President and Managing Director - Clinical & Product Development Strategy;

Commercial Strategy; Commercial Effectiveness; Market Access; Consulting at Quintiles

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Focus of the 2012 Report

The New Health Report 2011 looked to provide further understanding of stakeholder perceptions toward value in healthcare and medicine, and called upon open dialog and ongoing collaboration to foster an environment conducive to pharmacologic innovation. This report aims to build upon that call for collaboration by exploring the element of value at risk as it relates to biopharmaceutical development and delivery.

Given the global macro-economic environment and many governments’ focus on balancing unfeasible budgets through austerity programs, the pressure for biopharmaceutical companies to demonstrate the value of their products for driving optimal improvement in public health has never been greater. As such, resulting policies—i.e., reimbursement and coverage decisions—will in large part be dictated by a framework that includes a formulaic process for determining a biopharmaceutical product’s value relative to its risks. Yet, while centralized paying bodies are a critical component for the ultimate commercial success of a new treatment, all other stakeholders within the healthcare ecosystem— biopharmaceutical companies, providers, patients and financial investors—also have to determine the tradeoffs of how much of value is worth being put at risk, without the benefit of having either a standardized or centralized formula for doing so.

Rethinking the Risk Equation in Biopharmaceutical Medicine

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Geography

WHY US & UK?• An equal number of patients and payers were surveyed from both countries to

enhance the report’s global appeal and relevance to the global economic crisis. The UK is not only an accurate, progressive representative of Western European countries, but it also possesses a long track record of using quantitative measures to make reimbursement decisions for new biopharmaceutical products.

• For the biopharmaceutical industry, data from The New Health Report illustrate that there is no universal approach to risk/benefit. As such, an opportunity exists for the industry to engage stakeholders in dialogue to better design and communicate the various tradeoffs involved in healthcare decision-making.

Payer and Patient Respondents from both the U.S. and the U.K.

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Implications

• STAKEHOLDERS EACH POSSESS A UNIQUE PERCEPTION AND TOLERANCE LEVEL OF RISK/BENEFIT WITH REGARDS TO HEALTHCARE AND MEDICINE.> Biopharma respondents themselves have no clear consensus as to whether their company

should accept more risk in clinical development and commercialization. This could partly be explained to the current financial state of the company, as companies with looming patent expirations or thin pipelines will have a different risk-tolerance appetite than companies who are performing well.

• BETTER TOOLS ARE NEEDED TO ACCURATELY ASSESS RISK.> Current metrics used by biopharma and payers are insufficient and fail to account for the

varying degrees of weight different stakeholders assign to clinical, quality-of-life outcomes and value.

• BIOPHARMA AND PAYERS NEED BETTER ACCESS TO ROBUST SOURCES OF DATA.> Biopharma continue perceives Phase III as the most risky, but also as the phase in which they

feel less confident about available data.

• DESPITE THE PERCEIVED OBSTACLES, OPPORTUNITIES EXIST TO MITIGATE RISK.> Pre-competitive alliances and risk-sharing agreements are supported by both biopharma and

payers, and are perceived as increasing patient access to new therapies.

For the Biopharmaceutical Industry

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FindingsOutlook on the Future of Healthcare

• In terms of the quality of healthcare a decade from now, more than two-thirds of biopharma executives, U.S. payers and U.K. payers plus nearly three-quarters of the investors express optimism, but less than half of the U.K. and U.S. patients agree.

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FindingsIndustry Challenges

• Biopharma still perceives the FDA as the biggest challenges for the industry. Access to capital and payer reluctance to cover new medications are also concerns.

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FindingsPatient Perceptions of Risk

• Patients feel adequately informed about benefit, but feel less informed about potential risks and side effects.

• Patients are willing, however, to accept greater risks for a greater benefit. This sentiment is particularly among UK patients.

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FindingsRisk Assessment

• Currently used measures are not perceived as excellent and do not adequately assess risk in meaningful terms.

• This is likely due to an underlying lack of confidence in the data that feed the model.

• Better tools that are more reflective of how stakeholders – particularly patients – weigh risk/benefit tradeoffs are needed.

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FindingsComparative Effectiveness Research / Health Technology Assessments

• The UK payers’ lack of confidence in HTA may be a learning opportunity for stakeholders in the US as they rush to embrace CER and value-based medicine.

• Stakeholders in the US should focus their CER efforts toward proper methodology and data.

• As both countries move toward a more value-based healthcare system, the UK experience in weighing risk/benefit must be closely examined.

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FindingsRisk Mitigation

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Contact Information

Mari Mansfield, Corporate Communications

mari.mansfield@quintiles.com

O: +1 919 998 2639

M: +1 919 259 3298

Laura Wilson, Corporate Communications - Europe

laura.e.wilson@quintiles.com

O: +44 118 450 8392

M: +44 7854 173 106

www.quintiles.com/newhealthreport

For additional information about The New Health Report