Innovative Methods for Outcome-Based Pricing of Treatments from the US Payer Perspective (The Six Delta Platform)

Abstract

An independent group of researchers from the Center for Health Outcomes and PharmacoEconomic Research (HOPE), University of Arizona, has committed to designing, validating, and disseminating a platform of transparent methodologies for pricing of treatments that could potentially be used for outcome-based contracting from the US payer perspective. In brief, the suggested pricing methodology uses a multidimensional price assessment in which six dimensions (also termed δ) are used to provide price variations. Two-time horizons for assessing these 6 δs are considered, comprising two δs based on long-term assessments and four δs based on short-term assessments (Figure 1). Individually, each of these six δs is designed to use different scenarios for creating price variations (also termed dispersions) at the dimensional level. The price variations in each δ are simulated by Monte Carlo Simulation (MCS) methods to generate a price at the dimensional level (i.e., the dimension-specific price, DSP), and a price when all dimensions are integrated (i.e., the average of all dimensional prices, ADP). A proof-of-concept for the six pricing δs is provided for osimertinib in the treatment of non-small cell lung cancer (NSCLC) with epidermal growth factor receptor (EGFR) mutation.