A new model promoting the development and sustainable use of antimicrobials has been proposed by the Duke University Margolis Center for Health Policy.
Dubbed the “Priority Antimicrobial Value and Entry (PAVE) Award,” the model “provides developers quick access to a significant reward upon market entry of an effective antimicrobial, and provides strong incentives to shift reimbursement from insurance plans to population- and value-based contracts, not payments based on volume of sales,” according to a white paper detailing the proposal.
“This model builds on and reinforces the shift to quality and value in U.S. health care, with payments more directly linked to public health benefits and total costs,” Gregory Daniel, PhD, deputy director of the Margolis Center and lead author of the report, said in a viewpoint published online in JAMA ( 2017 Aug 3. doi: 10.1001/jama.2017.10164 ). “Along with strong push mechanisms that remove some of the financial risk associated with initial development of drug candidates, these measures could make a major contribution to the global effort to create and sustain a robust pipeline of antimicrobials that address current and growing public health needs – and would do so through an approach well suited to the reforming U.S. health care system.”
The proposal combines incentives provided from both the public and private sectors.
“In the PAVE Award, the MER [market entry reward] component would be available over the first few years upon market entry for a very limited set of high priority antimicrobials with specific eligibility criteria to give manufacturers clear development goals, and the magnitude of the MER could increase if the drug meets additional desired characteristics that are beneficial to larger public health needs, such as novel mechanism of action, oral availability, or new class of drug,” the report states.
Payments from public funds would be largest in year 1 and would decrease over the next 5-6 years, with each payment “contingent upon developers demonstrating an increasing share of their revenue from population-based [alternative payment models] linked to value to society through availability, support for sustainable use, and continued data collection,” the report notes, describing a method that emphasizes value and delinks revenues from volume.
Delinking revenues from volume has been a part of two prominent proposals in Europe. One proposed by Chatham House, a London-based public policy institute, also proposed a number of financial incentives, such as public funding and tax credits, to help finance development in addition to MERs. A second being developed in the European Union, expected to be finalized later this year, would provide grants for early stage research, establishment of a nonprofit developer to manage and finance discovery through commercialization, a MER to developers that meet certain criteria, an annual licensing fee to developers for access to their product, and a dual-pricing model that allows for higher prices to be charged for appropriate use.
The Duke paper identifies a number of contracting models, such as a manufacturer contracting with a health plan on a per-member per-month basis to provide the drug as needed, or episode-based payments as needed, for all hospitalized patients identified with specific diagnosis-related groups.
“Successful implementation of the PAVE Award will require cooperation between developers, payers, and providers,” the Duke policy researchers stated. “The contract should encourage short- and long-term savings from reduced inappropriate use, as well as reduced infection-related costs, such as extended hospital stays, treatment complications, and additional infections.”
For infectious diseases physicians, there are a few specific roles in addition to any that are played beyond being a part of the medical research.
“For example, as the clinicians on the front lines seeing the patients, they are able to really identify what are the emerging threats on the horizon and where do we need to be targeting R&D. I think that is useful for helping to inform which antibiotics should be eligible to receive market entry rewards,” Amanda Jezek, senior vice president of public policy and government relations at the Infectious Diseases Society of America, said in an interview. She also noted that physicians will be instrumental in “helping to create the political will to advance proposals like this because they are the ones who can really speak to what the need for patients is on the ground, in communities, and in hospitals.”
Physicians also will play a vital role in ensuring that any new antimicrobial drugs are not overused.
“Once these antibiotics are approved, infectious diseases physicians lead stewardship programs that are essential for ensuring that these drugs are used appropriately, and that is critical because if you start overusing the new antibiotics, resistance to them will develop quickly and you are back to where you started,” said Ms. Jezek, who was part of the advisory group that helped to inform the report.
