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| Express Scripts CMO Steve Miller |
Novartis ($NVS) has said it's planning to offer an outcomes-based plan for its new blockbuster-in-the-making to secure payers' favor. But skeptics see some kinks in the plan--and the CMO at leading PBM Express Scripts ($ESRX) is one of them.
Novartis' proposition involves insurers initially paying a lower price, followed by another payment if the heart failure med, Entresto, successfully keeps patients out of the hospital and helps cut associated costs. But with so many factors affecting a patient's outcome, Entresto's success will be hard to gauge, Express Scripts' Steve Miller told Bloomberg.
"If patients on this new drug go out and have a salty pizza and end up in the emergency room, is that the drug's fault or the patient's fault?" he said. "If the patient isn't adherent with taking the drug, is it the drug's fault or the patient's fault?"
The way he sees it, the U.S. doesn't have the infrastructure to collect the necessary patient data, and right now it's unclear whose job it would be to track their outcomes.
"These are the discussions we're having with Novartis--how will we actually do this so it's not burdensome for patients, payers and the pharma industry?" Miller told the news service.
It's not the industry's first foray into pay-for-performance. Drugmakers have set up cost-sharing deals with the U.K.'s cost-effectiveness watchdog, NICE, to get their pricey treatments through the gate. Johnson & Johnson's ($JNJ) Janssen, for one, struck a January deal with the NHS for hep C-fighter Olysio; under the terms, the NHS will only pay for the drug if it effectively cures patients after 12 weeks of treatment. If not? Janssen will refund the NHS' costs.
But some industry watchers have questioned whether those pacts really save the NHS any money. Back in 2010, a group of British health economists took a look at the NHS' first such deal--for Teva's ($TEVA) multiple sclerosis med Copaxone--determining that it was "a fiasco" and a "costly failure." Treated patients saw their MS progress faster than that of untreated patients, throwing the whole scheme out of whack.
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| Novartis pharma chief David Epstein |
Still, Novartis would rather work with payers than risk facing the pricing backlash its peers have gone up against lately. So while it may have some kinks to work out, it's still set on making pay-for-performance an option to payers.
"We can't make them do this," David Epstein, the Swiss drugmaker's pharma chief, told analysts Wednesday, as quoted by Bloomberg. "My guess is many won't even want to bother, but it is part of the offering."
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Special Report: The 25 most influential people in biopharma in 2015 - Steve Miller - Express Scripts - David Epstein - Novartis