Francesca Sandrini, JSB Medical Service Consultant, introduces the second part of the article on advanced therapies ATMP about changes on drug production flow, with the analysis of differences and prospective in the economic and commercial field among Advanced Therapy Medicinal Product, ATMP and traditional drugs.
The main topics: production costs of ATMP in the drug sales process | Economic consequences for pharmaceutical companies e for the National Health System (SSN) | Savings generated by Real Word Data in post-marketing.
Production costs and marketing price of a traditional drug
In the drug production, the product development has three phases: experimentation, industrialization, production, commercialization. Usually, time required to cover the entire cycle is very long – around 10 to 20 years – and costs are entirely borne by the pharmaceutical company. Once on the market, drugs can be purchased by patients (an example is over-the-counter drugs, such as a painkiller) or by the National Health System (an example is essential drugs, such as anticancer drugs).
The drug price is defined during the bargaining process that between the manufacturer and the Italian Drug Agency (AIFA) and must be economically viable for the company, thus covering production costs and guaranteeing a profit. In this way the company is encouraged to promote research in the pharmaceutical field and to develop other drugs for new disease treatments.
Production costs and marketing price of an Advanced Therapy (ATMP) drug:
In contrast, in the development of an Advanced Therapy drug, the initial phases of the research and experimentation usually take place within small biotechnological companies, Universities or hospitals and need funding.
Big pharmaceutical companies take over once the efficacy of the product is proven in experimentation and manages all the following steps, from clinical trials to industrialization and drug commercialization.
In Italy, Advanced Therapy drugs are included in the category of drugs borne by the National Health System and cannot be purchased by patients. The ATMPs are high technological drugs and its production has high costs comparing to traditional drugs. In addition, the target population is smaller in terms of numbers: these are drugs produced for selected patients or for patient-specific therapies, addressed to niches of patients suffering from a rare disease or a specific form of a more widespread disease. The result is that the selling price proposed by the pharmaceutical company under negotiation challenges the budget of the National Health System.
The new reimbursement system in Advanced Therapies
For this reason, new reimbursement models are under study, which can be sustainable in terms of costs both for companies and for the Health System. Among those already in use, there is the “payment by result”: the drug is bought by SNN and, if is not effective on the patient, the pharmaceutical company must reimburse the value. Recently, has been introduced even the “payment at result”: a drug is paid by instalments by SNN – a first fee during the drug administration, the following fees after patient check-ups to measure the effectiveness of the therapy. When the therapy is not effective on the patient, the payment is suspended.
The main goal is the definition of a new reimbursement system in Advanced Therapies, that take into consideration production costs and the impact of the therapy on the costs incurred by the National Health System. ATMPs therapies generate a significant improvement on the patient’s quality of life (if not the complete recovery), that means less hospitalizations, less surgical procedures, reduction of disability benefits.
To measure the impact on the use of ATMPs there are no specific tools yet, but even in this case several systems have been studied that will soon be integrated with existing ones. An example is Real World Data, data based on real evidences, such as the experience of patient that have already received the therapy o data generated by patient with the same disease. This data analysis (Real World Evidence) will also help companies to optimize the development and control of the post-marketing products, with a further reduction of time and costs.
With a focus on Smart Data management, we have been invited to take a speech on Blockchain & Healthcare at BODYNETS 2020 – 15th EAI International Conference on Body Area Networks: Smart IoT and big data for intelligent health management.
«This is the beginning of a story that continues to open up new challenges as well as promises», Luigi Naldini (Director of Istituto Telethon-San Raffaele per la Terapia Genica)