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Abstract Details
The Payer License Agreement, or "Netflix model," for hepatitis C virus therapies enables universal treatment access, lowers costs, and incentivizes innovation and competition
Liver Int. 2022 Mar 15. doi: 10.1111/liv.15245. Online ahead of print.
David W Matthews12, Samantha Coleman3, Homie Razavi3, Jean-Manuel Izaret12
Author information
The Boston Consulting Group, Exchange Place, 31st Floor, Boston, Massachusetts 02109, USA.
The Bruce Henderson Institute, 10 Hudson Yards, 42nd Floor, New York, New York, 10001.
The Center for Disease Analysis (CDA), Lafayette, CO 80026, USA.
Abstract
Background & aims: High unit prices of treatments limit access. For epidemics like that of Hepatitis C virus (HCV), reduced treatment access increases prevalence and incidence, making the infectious disease increasingly difficult to manage. The objective of the current study was to construct and test an alternative pricing model, the payer licensing agreement (PLA), and determine whether it could improve outcomes, cut costs, and incentivize innovation versus the current unit-based pricing model.
Methods: Computational modeling study evaluating the economics and epidemiology of the PLA model to treating hepatitis C in three high income countries.
Results: The present study had three key results regarding treating HCV. First, if the PLA model had been implemented when interferon-free direct-acting antiviral (DAA) combinations launched, the number of patients treated and cured would have more than doubled while the liver-related deaths would have decreased by around 40%. Second, if the PLA model were to be implemented beginning in 2018, the year that several Netflix-like payment models were under implementation, the number of treated and cured patients would nearly double, and the liver-related deaths would decline by more than 55%. Third, implementing the PLA model would result in a decline in total payer costs of more than 25%, with an increase to pharmaceutical manufacturer revenues of 10%. These results were true across the three healthcare landscapes studied, the U.S., the U.K., and Italy, and were robust against variations to critical model parameters through sensitivity analysis.
Conclusions and relevance: This study suggests that implementation of the PLA model in high-income countries across a variety of health system contexts would improve patient outcomes at lower payer cost with more stable revenue for pharmaceutical manufacturers. Health policy-makers in high-income countries should consider the PLA model for application to more cost-effective management of HCV, and explore its application for other infectious diseases with curative therapies available now or soon.