So-called “risk-sharing” pricing schemes are being discussed to justify high drug prices:
Johnson & Johnson has proposed that Britain’s national health service pay for the cancer drug Velcade, but only for people who benefit from the medicine, which can cost $48,000 a patient. The company would refund any money spent on patients whose tumors do not shrink sufficiently after a trial treatment.The groundbreaking proposal, along with less radical pricing experiments in this country and overseas, may signal the pharmaceutical industry’s willingness to edge toward a new pay-for-performance paradigm “” in which a drug’s price would be based on how well it worked, and might be adjusted up or down as new evidence came in.
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- The new tiered pricing for drugs
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By coincidence, I happened to post on my Bioethics Discussion blog the broader topic of pay for performance regarding physicians and hospitals but also included the pharmaceutical aspect as written up in the New York Times article. The issue of what degree of shrinkage of a tumor should be called effective drug treatment in a patient and require payment for the drug is one thing. The issue of how to establish realistic benchmarks for physicians and hospitals with patients with complex medical conditions or intentional avoidance of those complex cases by healthcare providers is another matter.
Kevin, your visitors may be interested in reading the current July 12, 2007 issue of the NEJM p.111 for the Perspective article “Is Zero the Ideal Death Rate?” which deals with benchmarks and report cards for evaluation of physician and hospital performance.
..Maurice.
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