Evidence Generation Is the Foundation to Optimal Product Positioning

Start a formal evidence-generation process early in Phase II development to ensure that necessary information is at hand to make pricing, reimbursement and product-positioning decisions at launch

By Teresa Wilcox, RPh, PhD, Peter Marangos and Beth Hahn, PhD, United BioSource Corporation Obtaining optimal product positioning and market uptake requires thoughtful planning and a fresh perspective in this turbulent global economy. While the need for product differentiation and comparative assessment has been a constant, there are increasing pressures from formulary decision makers and payers demanding evidence backed by an increasing level of scientific rigor. The economic environment is acting as a catalyst in the movement, truly signaling that it is time to provide value-based evidence data to support formulary positioning and product access.

It is therefore critical that pharmaceutical and medical device manufacturers attempt to address the questions that will define product value at an early stage in development:

What is the unmet need in the marketplace from the perspective of payers, physicians, and patients?

Does the clinical and other evidence generated to support the product address each stakeholder’s view?

Do the product development/commercialization plans include risk mitigation to allow appropriate assessment of the risk-benefit ratio?

What are the critical thresholds for evidence that must be met to enable decision making?

What are the competitive, regulatory, and reimbursement environments, present and future, that the product will face? Does the product development strategy address the dynamic environment?

Although European health authorities have long required value-based evidence, the US has lagged behind in their requirements. However, this expectation is evolving.

A recent summary of Centers for Medicare and Medicaid Services (CMS) coverage decisions found that the available evidence that is evaluated for national coverage decisions (NCDs) was seldom graded as better than “fair.”[1] Similarly, WellPoint, Inc. has recently re-issued their health technology guidelines outlining the process by which drugs are considered for placement on the Outcomes Based Formulary.[2] WellPoint’s process, similar to other MCOs, starts with a request to the manufacturer for data on safety and effectiveness, humanistic outcomes, total cost of care, productivity, and interventions/education. The product is reviewed first by the clinical review committee for clinical appropriateness and second by the value assessment committee for financial considerations. These guidelines highlight the need to plan value-based evidence for payers in parallel to evidence for regulatory authorities.

To date, evidence development planning for many pharmaceutical and device manufacturers has focused on simple publication strategies and economic or outcomes studies piggybacked onto regulatory trials. Because manufacturers often operate in a departmental system, an integrated approach that synthesizes all data to support a drug or device is difficult to achieve. The result is misalignment of research and a failure to leverage studies that may be ongoing in other departments.

As a result, the “evidence portfolio” to support a product is a collection of publications that may or may not address the concerns of the target audience, or properly highlight the value of the product or therapy. A scant evidence portfolio has clear ramifications when making the case to support a product with a payer, but also consequences for internal decision-making. A clear example of this is in pricing. Historically, pricing decisions have been made either by commissioning complex models that are not easily understood or communicated or to an informal judgment call by senior management rather than an analytical process that synthesizes all data to support a drug and is revised throughout the development process.

A comprehensive pricing and reimbursement strategy with supportive value-based evidence generation should include the same stage-gate needs as the clinical development process, and be an integral part of the development of a new product. The strategic planning approach for evidence generation that is proposed here will serve to build a strong evidence base to support the product at launch and throughout the lifecycle.

A strategic planning framework

The process that we propose to guide the building and refinement of the knowledge base to support product value is Evidence Generation Strategic Planning (EGSP). EGSP is much like a product strategy document, but goes further to provide a comprehensive, multi-year, multi-dimensional approach to document and communicate product value. Establishing a standard and consistent EGSP methodology will facilitate coverage, reimbursement, and market adoption by ensuring that the right value-based evidence is communicated to the right audience at the right time (Figure 1).

The EGSP process we propose is results-oriented to ensure that available data are fully integrated and new research projects are designed to build on a unified body of evidence that will effectively communicate value to decision-makers. The EGSP process has four key steps:

1. Evaluate - Identify, summarize, and evaluate the available evidence, the marketplace (i.e., standards of care, comparator treatments, key stakeholders, etc.), and competitive challenges to identify evidence gaps and unmet need. This should include the following components:

Pricing and reimbursement landscape and objectives

Clinical and health outcomes data

Thresholds for evidence required by key decision-makers

2. Position - Determine the target value proposition that addresses unmet need and describes (or demonstrates) product value to internal stakeholders and external decision makers.

3. Develop - Identify and prioritize the evidence required to support the target value proposition, define the resources needed, and outline a timeline for evidence generation.

4. Communicate - Outline a publication plan and communication strategy to ensure that the right evidence reaches the right audience at the right time.

Effective EGSP Implementation

EGSP is most effective when a systematic, standardized, and repeatable process is in place, and, when properly implemented, it will result in efficient demonstration of product value. Ideally the EGSP process should occur alongside clinical development to build a strong evidence base to support the product at launch and throughout the lifecycle. Internal manufacturer stakeholders involved in the process should include project planning, clinical, epidemiology, risk management, regulatory, pricing and reimbursement, health outcomes/economics, managed markets, and brand marketing teams working as a cross-functional group within the organization.

The charge of this cross-functional EGSP implementation team is two-fold.

The first objective of the EGSP implementation team is to create a useful tactical plan that includes the following elements:

An assessment of the available evidence and current market landscape, including the key value drivers and unmet need.

A value proposition for the product, composed of target value statements that correspond to the identified unmet need. Value statements should be provided alongside the available supporting evidence and current therapeutic marketplace. This should also include a description of the validation process for the target value proposition according to each relevant audience (e.g., payers, physicians, patients, regulatory, etc.)

Recommendations for evidence generation tasks, studies, or other research projects.

A communication and dissemination plan.

The second objective is to execute the plan. Creating a meaningful and valuable plan requires senior scientific expertise with an emphasis on evidence, and recommendations that are both solutions-oriented and communication-focused. A successful EGSP implementation process will align both internal and external teams to ensure that all groups are communicating and leveraging the work that others are doing. Strict adherence to timelines and deadlines is also critical, as is the ability to manage outsourcing and maintain transparent working relationships with vendors. This includes simultaneous management of a number of ongoing research projects across internal divisions, as well as vendors and other external organizations.

Opportunities for EGSP Implementation

Virtually all products and product scenarios may be able to benefit from additional and proper planning, and as a result the benefits of implementing an EGSP process are not limited to early stage products. EGSP may be implemented at nearly any point in the product development lifecycle; however, the needs of the particular product will dictate the approach. The decision making process required for effective EGSP during each phase of product development is outlined in Figure 2.

Exploratory phase:

The exploratory phase involves decision making around the target product profile and the characteristics of the particular product being considered. The degree to which the product characteristics align properly with objectives outlined in the target product profile will drive the go/no-go decision for further development of the product. EGSP can set the stage for these due diligence decisions by prioritizing information gathering on disease burden and competitive landscape, thereby informing early clinical trial design (e.g., endpoints, patient population, etc.) and implementation, as well as pricing and label decisions.

EGSP will also facilitate prioritization of target indications and determination of the target value proposition. Ideally, this phase should also include a preliminary payer analysis to validate these decisions, as well as a coding analysis (if the product is considered a medical benefit). The objective of the preliminary payer analysis is to understand market feasibility and requirements for favorable acceptance by the payer community. This information can be useful to the design of Phase II clinical trials with regard to particular requirements needed to support reimbursement. At this stage, the objectives of the coding analysis are to investigate whether resources need to be dedicated to securing one or more new diagnosis, procedural, or drug billing codes, or whether any existing codes may support reimbursement.

Registration phase:

Products in the registration phase, following successful proof of concept, can benefit from EGSP to not only define evidence generation tasks, but also to define the external decision-maker and internal-stakeholder audiences, as well as competitive and regulatory hurdles. Decision making during this phase focuses on establishing superiority (or non-inferiority) of a product via clinical trials, economic and epidemiological studies, risk management planning, and pricing and reimbursement strategy.

Prior to the completion of Phase II clinical trials, an initial pricing model that incorporates the existing data is needed. Many pricing decisions are currently based only on the clinical profile of a product; however, these decisions must also include epidemiology, cost of the illness, and patient, physician, and payer data. The objective of pricing at this stage is to establish optimal price bands that are supported by the product’s value proposition and the reimbursement environment. The initial reimbursement strategy is also developed at this time, building upon the payer analysis conducted in Phase I.

Components of a comprehensive strategy include assessment of reimbursement by competitors for all major markets, decisions, and recommendations imposed by reimbursement authorities, the initial payer value proposition, and strategy for all major payers. The reimbursement strategy results in a detailed plan of activities (e.g., evidence generation plan) focused on securing favorable access, coverage, and reimbursement. Optimal pricing supported by reimbursement and access expectations should be evaluated along with Phase II clinical trial results to determine whether further investment is warranted. Implementation of EGSP at this phase will allow for input into the design of Phase III trials, including consideration of appropriate comparators and the addition of endpoints to support health economic analyses.

The majority of pricing and reimbursement research will be conducted when the results of Phase III studies have been established internally (although they may not yet be published). The completed product profile—including economic and burden information, as well as target indications and patient groups—is used to further refine the pricing model with data that test a variety of prices for the final value proposition against the competitors with key decision makers, which typically include payers, physicians, and, depending on the disease state, patients. The refinement results in a narrower price band with an optimal launch price.

The results of Phase III studies and parallel value-based evidence generation (i.e., cost of care analysis) also are important for the refinement of the reimbursement strategy, as this information is used to conduct payer research to understand receptivity to the product, test the value proposition, and identify barriers or issues to address strategically in preparation for launch.

Approval and commercialization:

Communication of available evidence for the product and other launch decisions focuses on establishing disease awareness, the final label, and product image. Once commercialized, decisions around market support and label expansion, as well as comparative effectiveness and patient access, are of primary concern. At this stage, EGSP may be implemented to leverage or expand upon existing evidence, revitalize an underperforming product to increase market uptake, or respond to new competitive challenges, new information, or changing market dynamics.

Examples of EGSP Implementation

As described above, there are a number of opportunities for EGSP implementation throughout the product lifecycle. Table 1 identifies specific product scenarios in which implementation of EGSP may be valuable and should be considered.

The Value of EGSP

EGSP not only provides coordination of the evidence base to support product value to payers, but also assists internal decision-making in a systematic way. A further benefit of EGSP is the ability to maximize product development efficiencies by eliminating redundancy and streamlining efforts across internal groups, thereby facilitating decision making at all stages of product development. Using EGSP to establish a common focus eliminates the need to constantly justify the value, budgets, and objectives of research projects. It also raises awareness of ongoing work across internal stakeholder groups and external vendors, which reduces information gathering and duplication.

When implemented properly, EGSP provides a comprehensive, multi-year strategy, across the product lifecycle, to document and communicate evidence of product value. This systematic approach allows for thoughtful planning of evidence generation and associated resource allocation to optimize product positioning. In others words, EGSP provides the ability to generate the right value-based evidence, for the right audience, at the right time. PC

REFERENCES

1 Neumann PJ, Kamae MS, and Palmer JA. Medicare’s national coverage decisions for technologies, 1999-2007. Health Affairs, 2008; 27(6):1620-1631

2 WellPoint, Health Technology Assessment Guidelines: Drug Submission Guidelines for New Products, New Indications, and New Formulations (updated September 2008), https://www.wellpointnextrx.com; last accessed April 15, 2009

All the authors are executives at United BioSource Corporation, Bethesda,

MD. Teresa Wilcox, RPh, PhD, is Senior Research Scientist, Center for Health Economics and Science Policy ([email protected]). Peter Marangos, is Manager, Product Marketing, and Beth Hahn, PhD, Managing Director, Center for Pricing and Reimbursement.