Analysis Shows Health Care Cost Predictions Grossly Incorrect

This study, once again disproves the misleading claims that pharmacy benefit managers and insurers (among others) make about spending on new innovative medicines. The report found that predictions of health care costs made prior to the introduction of new medicines were often dramatically overstated. The study points to the example of new cholesterol-lowering medicines, also known as PCSK9 inhibitors. The Institute for Clinical and Economic Review (ICER) predicted that the one-year cost of the two PCSK9 inhibitors would be $7.2 billion. However, in reality, based on reported sales, the actual cost will be approximately $83 million. The difference between the predicted cost by ICER and the actual cost based on reported sales is a difference of over $7.1 billion. Unfortunately, it wasn’t just those PCSK9 inhibitors where the predictions were far off-base. PHAR studied a total of fourteen medicines, launched since 2012, that treat various forms of cancer, hepatitis C, obesity management, cystic fibrosis, heart failure, psoriasis, and diabetes. The researchers found twenty-four published predictions for the fourteen drugs and compared them to actual sales. On average, predictions for the drugs analyzed were eleven times higher than actual sales. That means that for every $11 of predicted costs, there was only $1 of actual cost to the health care system. Such a gross overestimate may have a negative impact on patient access – payers may be more likely to impose utilization ...
Source: Policy and Medicine - Category: American Health Authors: Source Type: blogs