ISPOR Methods GuidanceA Report of the ISPOR Task Force on Budget Impact Modeling

January 21, 2009

Sean D. Sullivan, PhD

Pharmaceutical Outcomes Research and Policy Program

School of Pharmacy

University of Washington

Seattle, WA

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Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Topics
        - Introduction to the Task Force
        - Task Force Report
        - Outline of Report
        - Key Recommendations
        - Comments From Reviewers
        - Publication

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Background
        - Evidence requirements from payers now include mandates for budget impact analyses (models)
        - No formal methods guidelines exist on conduct and reporting of budgetary impact analyses.
        - Heterogeneity in type, quality and reporting of analyses conducted for/by payers.
        - The ISPOR BIA Task Force has produced the first set of Methods Guidance on the conduct and reporting of budgetary impact analyses.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Source:  IMS Health Consulting  Nov 2005

 Pharma’s Shift to Specialty Products

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Source: EC 2006, adapted
| Relative efficacy | Relative effectiveness | Cost effectiveness | Budget impact |
|-------------------|------------------------|--------------------|---------------|
| Austria           | x                      | x                  | x             |
| Belgium           | x                      | x                  | x             | x |
| Czech Republic    | x                      | x                  | x             |
| Denmark           | x                      | x                  |
| Estonia           | x                      | x                  | x             |
| Finland           | x                      | x                  | x             |
| France            | x                      | x                  |
| Germany           | x                      | x                  | x             |
| Greece            | x                      | x                  | x             |
| Hungary           | x                      | x                  |
| Ireland           | x                      | x                  | x             | x |
| Italy             | x                      | x                  | x             |
| Latvia            | x                      | x                  |
| Lithuania         | x                      | x                  |
| The Netherlands   | x                      | x                  | x             | x |
| Poland            | x                      | x                  |
| Portugal          | x                      | x                  |
| Slovenia          | x                      | x                  | x             |
| Spain             | x                      | x                  | x             |
| UK                | x                      | x                  | x             |

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Pharmaceutical Outcomes Research and Policy Program

University of Washington

*

History of ISPOR Guidance
        -  ISPOR Health Sciences Policy Council
        - Advise the ISPOR BOD on matters related to science policy.
        - Determine areas of scientific consensus and translate into methods guidance documents for researchers and users.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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History of ISPOR Guidance
        -  Current ISPOR Methods Guidance Documents
        - Research Ethics
        - Modeling Studies
        - Retrospective Studies
        - Real World Data/Evidence
        - Budgetary Impact Analyses
        - Patient-Reported Outcomes

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Task Force Mission
        - Develop a coherent set of methodological guidelines* for those developing or reviewing budget impact analyses  
        - Develop a template for presenting the results of budget impact analyses that is useful for decision makers

* Not an instruction manual

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Task Force Members
        - Jo Mauskopf, PhD and Sean D. Sullivan, PhD (Chair)
        - Jerusha Harvey – ISPOR Staff
        - Lieven Annemans, PhD
        - Jaime Caro, MD, CM
        - Dan Mullins, PhD
        - Mark Nuijten, MD, PhD
        - Ewa Orlewska, MD, PhD
        - Paul Trueman, MA
        - John Watkins, Pharm.D., MHA

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Report Outline
        - Abstract
        - Introduction
        - Definitions and Intended Use
        - History of BIA
        - Task Force Process
        - Recommendations for Analytic Framework
        - Recommendations for Inputs and Data Sources
        - Recommendations for Reporting Format
        - Recommendations for Budget Impact Computer Model
        - Final Discussion

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Purpose of BIA
        - Budget Impact Analysis (BIA) is an essential part of a comprehensive economic assessment of a health care technology and is increasingly required, along with cost-effectiveness analysis (CEA), prior to formulary approval or reimbursement. 
        - The purpose of a BIA is to estimate the financial consequences of adoption and diffusion of a new health care intervention within a specific health care setting or system context given inevitable resource constraints. 

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Purpose of BIA
        - There may be circumstances where the CEA indicates an efficient technology while the BIA results indicate that it may not be affordable to the budget holder.     
        - In such instances, there is, unfortunately, no current scientific guidance on how to resolve this dilemma.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Intended Audience
        - The intended audience is health care decision makers who are responsible for local, regional or national budgets as well as research analysts who perform these studies for health care decision makers.
        - Others who may find this guidance useful include patient advocacy groups, health care professionals, drug and other technology manufacturers and those developing guidelines for their settings.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

*

BIA - Analytic Framework
        - The purpose of a budget impact analysis is not to produce exact estimates of the budget consequences of an intervention but to provide a valid computing framework that allows users to understand the relation between the unique characteristics of the budget holder and the possible budgetary implications of introduction of a new health technology.  
        - The modeled outcomes should reflect the impact on the budget of interest to the decision maker and should be based on relevant scenarios that consist of a set of specific assumptions about the likely impact of the new technology in the health plan and other health plan characteristics rather than a scientifically chosen “base case” or “reference case” based on nationally valid assumptions and inputs.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Pharmaceutical Outcomes Research and Policy Program

University of Washington

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BIA - Analytic Framework
        - Specific recommendations in this section relate to:
        - Proper design of the analytic framework
        - Disease model consistent with CEA disease model
        - Reports all budgetary implications NOT JUST the technology under  evaluation
        - Perspective of the analysis
        - The budget holder
        - Base case analysis
        - Most likely funding scenario w/wo restrictions
        - Population included
        - All persons likely to receive the new technology including induced demand

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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BIA - Analytic Framework
        - Specific recommendations in this section relate to:
        - Time horizon of the analysis
        - One to three years with longer time horizons if of interest to budget holder
        - Costing and discounting
        - Budget holder transaction prices, stream of costs over time and no discounting
        - Uncertainty analysis and validation
        - Primarily alternative scenarios chosen by budget holder
        - PSA not required

Pharmaceutical Outcomes Research and Policy Program

University of Washington

*

BIA - Inputs and Data Sources
        - Specific recommendations in this section relate to:
        - Size and characteristics of the population
        - Epidemiology, disease natural history, and database estimates
        - Current intervention mix (without the new intervention)
        - Budget holder data or published or market research data
        - New intervention mix (with the new intervention)
        - Market forecast with transparent assumptions about how switch from or add-on to other treatments occurs
        - Cost of the current and new intervention mix
        - Acquisition cost plus administration, monitoring, and side effects, adjusted for adherence, product discounts, and co-payments from budget holder database or assumptions
        - Use and cost of condition- and treatment-related healthcare services
        - Based on data from clinical trials or that used in disease model designed to estimate impact on population resource use and costs each year after product approval.

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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BIA - Reporting Format
        - This section of the report contains a suggested format for reporting on the conduct and results of a BIA.
        - Important in that it promotes a consistent and standard format for reporting model and results
        - Output
        - Budgetary implications represented by monetary flow (raw or per capita) over the study time horizon.
        - Components of budget impact to be displayed.
        - In addition to a report that follows the main headings of the framework, inputs and data sources section, guidance is given on tabular and graphical display.  These include:
        - Figure of the model structure
        - Table of model assumptions
        - Tables of inputs and outputs
        - Schematic representation of uncertainty/scenarios

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Recommendations for Computer Model
        - This section of the report contains recommendations on the development and use of computer simulation models for reporting the results of BIA
        - Simple spreadsheet model
        - Include default input parameter values and text description of each parameter and reference to data source
        - User ability to change all input parameter values and also to restore defaults
        - Presentation of results in tabular and graphical format
        - Presentation of results at different levels of detail
        - User ability to change the scope of the analysis including the duration of results and the cost components included

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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Peer Review Process
        - Comments from Researchers and Users Representing
        - Belgium, Canada, Korea, Poland, Spain, The Netherlands, Sweden, UK, US
        - ISPOR Membership (> 40 respondents)

Pharmaceutical Outcomes Research and Policy Program

University of Washington

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ISPOR Web Site
        - www.ispor.org