ICER Publishes Alternative Vaccine, Therapy Pricing Policies Amid Pandemic

In an effort to inform both the public and policy makers, the Institute for Clinical and Economic Review (ICER) published a white paper this week entitled “Alternative Policies for Pricing Novel Vaccines and Drug Therapies for COVID-19.”

“Leaders in government, business, and society all seek to adopt policies that will spur the development of treatments and preventive therapies for COVID-19 that can be delivered as rapidly as possible in an affordable and equitable manner,” said ICER President Steven D Pearson, MD, MSc, in a statement. “One critical issue will be how new treatments will be priced to ensure that this goal can be met.”

The white paper provides background and historical context by summarizing experiences and lessons learned from past health crises including previous epidemics, flu vaccines, polio vaccines, HIV treatment, and more. It then delves into six different main points with both pros and cons of each approach. The six main topics include: (1) status quo/unrestricted pricing; (2) cost-recovery pricing; (3) value-based pricing; (4) monetary prizes; (5) compulsory licensing; and (6) advanced market commitments and subscription models. 

Each model comes with its own advantages and disadvantages. For example, the white paper explains that status quo or unrestricted pricing is a “tried and true approach that has produced innovative products,” however, pricing without restrictions could lead to significant affordability problems. 

Value-based pricing, on the other hand, would set a “ceiling price for new treatments based on the clinical benefit patients receive,” but due to the timeliness and accelerated process of drug approval during a pandemic, it is difficult to measure clinical benefit. Value-based pricing also does not take into account the population size. 

“No single policy option will gain consensus as the best approach,” ICER stated in the white paper. 

In addition to the concepts outlined in the paper, ICER stated that it will be hosting a three-part online series in which health experts from across the nation will debate the advantages and disadvantages of several proposed approaches to pricing. —Edan Stanley