Managing costly new drugs to support equitable access: international collaboration and patient engagement to assess value, and managed entry agreements

Abstract

Tarang Sharma and colleagues argue for increased collaboration across public and private sectors—internationally and with patients—in drug assessment and managed entry agreements to support equitable and sustainable access to costly medicines

Over the past decade, the pharmaceutical market has shifted from one dominated by high volume blockbuster products—that is, having at least $1bn (£0.75bn; €0.86bn) in annual global revenues—to one featuring targeted therapies for smaller populations, often for rare diseases with limited treatment options. Such therapies include orphan drugs (treatments needed by no more than five in 10 000 people in the European Union)^{1 2} and advanced therapy medicinal products (ATMPs), including gene, cell, and tissue therapies. Government policies have incentivised and spurred growth in these specialised therapies, yet equitable and affordable patient access is still a challenge, even in high income countries.¹

Standard reimbursement models are not suitable for costly new drugs. We argue for increased dialogue among governments, industry, and other stakeholders which encourages assessment of value that captures the perspectives of patients and their families as well as managed entry arrangements that share risk between industry and payers to create sustainable access for patients.

This paper is part of a BMJ Collection on equitable access to costly new drugs (https://www.bmj.com/collections/novel-medicines) that highlights topics explored by the Oslo Medicines Initiative and the Access to Novel Medicines Platform of the World Health Organization Regional Office for Europe. The Oslo Medicines Initiative was a collaboration between the WHO Regional Office for Europe and the Norwegian Ministry of Health and Care Services and the Norwegian Medicines Agency in 2020-22 that aimed to tackle equitable and affordable patient access to costly new drugs.¹ Building on this work, the WHO Regional Office for Europe established the Access to Novel Medicines Platform, which brings together governments, industry, and other stakeholders online to facilitate the development and implementation of policy solutions and establish pilot projects.³

Voluntary international collaborations, such as the Baltic Procurement Initiative, Beneluxa Initiative, FINOSE, and Nordic Pharmaceutical Forum, show that countries working together can achieve better access to drugs for patients at more affordable prices.^{4 5} Such collaboration could help in key ways: joint agreement on assessment of the value of novel treatments; agreement on whether a managed entry agreement would be appropriate and if so, what type; and the potential for joint negotiations and procurement increasing purchasing power. However, challenges may include navigating legal and confidentiality constraints, aligning different national regulatory and reimbursement frameworks, and fostering trust and transparency among stakeholders, which the Access to Novel Medicines Platform attempts to tackle through consensus and dialogue.^{4 5}

Challenges in price regulation

Many different approaches exist for regulating the prices of drugs. One approach is value based pricing, where value to the health system is determined through an estimation method that maximises population health with limited resources and constrained budgets.⁶ Implementation of value based pricing for drugs varies among countries, depending on perspectives of value (benefits) identified and considered alongside costs.⁷ Solidarity based health systems (built on the principle that access to healthcare should be determined by need rather than ability to pay and are typically publicly funded) frequently use elements of value based pricing to inform reimbursement decisions, often through health technology assessment.¹ Many value frameworks and formats for multicriteria decision analysis have been developed to contextualise value based pricing that allows trade-offs and opportunity costs to be considered.^{4 8}

The use of orphan drugs, including ATMPs, has been encouraged through various policy incentives often by high income countries, which has led to the successful development of many treatments for rare diseases. In Europe, for example, it is estimated that more than half (74) of the 142 of the drugs granted orphan designation between 2000 and 2017 would not have been commercially viable without government incentives.² Yet, at the same time, orphan drugs can become blockbuster products because they obtain authorisation for multiple, mostly rare, conditions. The European Medicines Agency has approved 29 ATMPs to date in 2025,⁹ with the US Food and Drug Administration expecting a further 10-20 cell and gene therapies targeting rare diseases to enter the market each year.¹⁰ These drugs are generally administered in a single dose, at high cost per patient, and with potential benefits anticipated many years after the end of clinical studies.^{11 12}

Although many of these drugs are anticipated with hope by patients and caregivers, three main problems exist—costs, evidence, and health system readiness. Costs can be prohibitive, with the most expensive currently priced at more than €2m (£1.7m; $2.3m) per single dose treatment. The pharmaceutical industry argues that this reflects the assumed benefits over a patient’s full lifetime and the costs avoided for existing models of care. Payers and health technology assessment bodies face challenges as they need to determine cost effectiveness and ensure sustainability for the health system, while regulators need only to consider efficacy and safety.¹³ Moreover, despite the potential of tailoring for timely and targeted prevention and treatment,¹⁴ these new treatments often risk “orphanisation”—that is, they become targeted monopoly therapies for very small patient groups. As many of these treatments are currently single source products (available from only one manufacturer or supplier) with both patent protection and regulatory exclusivity and given the small patient numbers, it is unclear how therapeutic competition through biosimilars might evolve over time to reduce costs.¹⁵

Moreover, as these drugs treat rare diseases, they are often approved by regulatory authorities based on small, sometimes single arm clinical trials, which often rely on surrogate endpoints instead of final clinical outcomes. This leads to considerable uncertainty about their effectiveness and, by extension, the full value of these treatments, making it difficult for health technology assessment bodies and payers to use their standard criteria for evidence assessments, which often require more rigorous clinical designs.¹⁶ Value is difficult to determine when the evidence is immature. Health technology assessment bodies and payers thus face the challenge of managing the high costs per patient of these therapies that enter the market with limited evidence,¹⁶ which risks substantially increasing public expenditure on therapies.¹⁷ For example, recent reviews of novel oncology treatments in Belgium¹⁸ and a multicountry study evaluating similar treatments¹⁹ found that added benefits were limited, although benefits were assessed using standard value assessment frameworks.

Companies also often launch these complex therapies only in markets that have substantial numbers of patients or with systems ready to use the treatments, or both. These products require extensive health system infrastructure and specialised healthcare expertise. As a result, many such treatments are unavailable in all but the largest economies, or they become available only a decade or more after initial regulatory approval, leading to inequitable access for patients.¹⁶

Reconsidering assessment and reimbursement

Standard value assessment frameworks that have been commonly used until now are proving inadequate for the evaluation and pricing of these new treatments^{4 20} because different stakeholders have different priorities: regulators focus on safety and efficacy, and health technology assessment bodies and payers emphasise cost effectiveness and the effect on budgets, leading to differing value assessments for the same product.¹³

Patients advocate for using a wider perspective beyond traditional clinical endpoints when evaluating the value of novel therapies. They also support faster access to innovative therapies, facilitated by regulators through schemes such as accelerated assessment by the European Medicines Agency. However, payers and health technology assessment agencies may have to delay reimbursement when upfront costs are high and the real benefits are uncertain, especially long term value, as currently is the case for ATMPs.

The pharmaceutical industry aims for the best pricing to support and foster continued innovation.^{21 22} It has called for dynamic value based pricing to integrate the value of new drugs over their lifecycles as new evidence emerges, and to take into account lower prices that may occur after patent expiry.²³ A recent Dutch study found that this approach of considering value over a drug’s lifecycle including after patent expiry can substantially improve cost effectiveness.²⁴ However, the assumptions of this approach, especially the emergence of competition from generics to reduce costs, may not hold true. The industry also advocates for wider perspectives to be considered beyond traditional cost effectiveness, but it can experience challenges at reimbursement from payers and health technology assessment agencies for not providing enough robust evidence of good value for money for the population these agencies serve.^{21 22}

Many health technology assessment agencies have updated their methods to support the reimbursement of such treatments, often permitting higher thresholds or specialised processes. For example, the National Institute for Health and Care Excellence (NICE) in England and Wales has a “highly specialised technologies process”²⁵ or recent Estonian guidance considers “high value-added health technologies.”²⁶ New oncology drugs and ATMPs, followed by orphan drugs, are in the first of two waves of joint clinical assessments by the European Health Technology Assessment Regulation (Regulation (EU) 2021/2282), with implementation from 12 January 2025. This regulation promotes the joint clinical assessment of such therapies but leaves the non-clinical aspects, including assessment of cost and budget, to national authorities. The Oslo Medicines Initiative considered some analyses that highlighted the inadequacies of current reimbursement systems for these costly new drugs, as well as proposals for change,^{27 28 29} and recommended several policy options for improvement.

Stakeholders need to find common ground and align perspectives to determine the value of costly new drugs to support equitable patient access, ensure sustainable expenditure by public programmes, and send clear signals to industry about what health systems value and are willing to pay for. Users of the Access to Novel Medicines Platform have identified 10 proposals that could improve the status quo; these should be pilot tested and implemented in a pragmatic staggered approach.³⁰

The perspectives of different stakeholders are essential to determine the value of drugs, although views often differ, leading to ethical challenges.³¹ Increasingly, patient insights, including their knowledge, preferences, and lived experiences, are being considered to enrich understanding of the value and effect of drugs in the real world.³² Having patient representatives and their families share direct experience of living with or supporting someone with a condition can also give the discussion of unmet needs a more holistic perspective, which is essential in determining the benefits of treatments. Outcomes reported by patients help embed patient perspectives in benefit assessments,³³ but they may not fully capture lived experiences; hence, measures of patient experiences need to be factored in too. Indeed, countries including Canada, Norway, Sweden, and the UK now incorporate syntheses of qualitative evidence of patient experiences into value assessments to complement traditional effectiveness reviews.³⁴ Moreover, countries such as Belgium and New Zealand have adopted deliberative public engagement processes as part of their national reimbursement processes to reflect broader public preferences and societal values,³⁵ instead of focusing on the health perspective alone.

These mechanisms support a better understanding of the value of new treatments as well as the practical implications and the need health systems may have for them. Patient representatives contribute valuable information on their needs. A good example of actively engaging with patients to understand the full value of specialised treatments in early dialogue with industry is the Mechanism of Coordinated Access to orphan medicinal products. This includes patients alongside clinicians in discussions with payers, health technology assessment bodies, and regulators and has provided a pathway for faster access for treatment for rare diseases for 23 products.³⁶

Instead of restricting this approach to orphan drugs, it should be expanded to all costly new drugs throughout a drug’s lifecycle, as the Access to Novel Medicines Platform has proposed in Europe.³⁰ This forum could support structured dialogues between patients, payers, regulatory and health technology assessment bodies, and industry. This could allow for discussion of challenges and cocreation of solutions at two levels of engagement: first, general dialogue to facilitate health system readiness; and second, product specific dialogue to support pooled procurement among groups of volunteer countries for joint negotiations for pricing and reimbursement.

Better managed entry agreements

Managed entry agreements are arrangements between drug companies and healthcare payers that allow for the coverage of new drugs while managing uncertainty about the financial impact or performance. Agreements can be financial (such as simple discounts or discounts for volume purchases) or outcomes based (such as pay for performance or coverage with evidence development-type agreements). In the WHO European region, such agreements are often used for costly new drugs with high uncertainty about effectiveness.^{4 37}

Managed entry agreements are a promising tool for improving access to high cost drugs with uncertain evidence profiles at launch by measuring value over time and ensuring that risk is truly shared between the industry and payers. This is often done by making payment conditional on achieving specified outcomes based milestones. Unfortunately, the terms of most agreements are confidential³⁸ because of the commercially sensitive nature of this information and the inter-relationships between prices in different countries through international reference pricing. These agreements often have undisclosed discounts while maintaining high list prices.

A study of managed entry agreements in six countries using data from 2016 estimated that they increased list prices on average by 6%.³⁷ Therefore, improving transparency is key to keeping prices contained. Another study looked at levels of evidence and subsequent reimbursement decisions and prices of new hospital financed drugs in Norway in 2021 and 2022. The study concluded that these agreements and evidence generation after launch were the correct strategies for balancing early access with affordability and evidence based decision making.³⁹ A 2023 review of ATMP reimbursement in 20 countries identified the need for harmonised approaches and shared frameworks to improve affordability and access.⁴⁰

Some managed entry agreements require the collection of additional real world data and long term outcomes that can provide valuable supplementary evidence.³⁸ For instance, real world data can offer insights on subgroups of atypical patients who may have been excluded from randomised control trials,³¹ which may support the determination of value of costly drugs. However, recognising the biases inherent in observational data can leave payers with lasting uncertainty about the clinical value of these therapies. Thus, where additional data are collected, these should be drawn from methodologically sound observational studies or pragmatic clinical trials. Where diseases are life threatening and alternative therapies non-existent or unavailable, community pressure may be exerted on governments to make these therapies available quickly, despite the lack of enough evidence. In responding to this pressure, some countries have established separate funding mechanisms to facilitate access to selected novel therapies. For example, in 2021 the Innovative Medicines Fund was launched in the UK, with a starting budget of £340m ($454m; €391m) to support access to all non-cancer novel therapies after the Cancer Drugs Fund was revised through an evidenced based approach by NICE. Similar innovation funds have been established in Belgium, Croatia, Italy, and Poland.⁴ These additional funding streams have improved patient access but can quickly become unsustainable and they may undermine robust value assessments. Such funds need to finance not only the new treatments but also the managed entry agreements that assess their value over time and the infrastructure and personnel required to manage them.

Managed entry agreements should be more transparent so that countries and the pharmaceutical industry can learn from each other’s experiences, as the Access to Novel Medicines Platform advocates. This platform is identifying criteria for suitable candidates (ie, those with clinical uncertainty, high unmet need, budgetary impact, and low patient numbers) and is developing a checklist for countries, industry, and patients to use together to improve consistency, transparency, and better assessment of value.³⁰ An incentive for industry is that this approach could encourage consistency among markets and increase access to more countries. Although this may lead to more such agreements, the practical tools offer support to countries in navigating these processes, enabling them to provide access to complex treatments and thereby reduce inequities and variability in access across our region, while also increasing the market size for industry.

Public sector investment and public-private partnerships

In addition to new approaches to value assessment, another important component in the appraisal process to inform a pricing and reimbursement decision is public sector funding of drug research and development.^{16 28} Calls have been made by academics and the public sector to take into account the contribution of public investment.²⁸ Publicly funded, large adaptive platform trials during the covid-19 pandemic, such as the Recovery and Solidarity trials,⁴¹ highlighted the benefit of public sector investment in clinical research. For ATMPs, the regulatory pathway of hospital exemption in the European Union allows ATMPs to be developed in academic institutions in the public sector; however, implementation varies substantially among countries.⁴² Moreover, little knowledge is shared between countries and industry in the field of ATMPs.

The covid-19 pandemic offered a unique example of industry, regulators, health technology assessment agencies, and payers coming together to facilitate the adoption of new technology such as mRNA vaccines, through swift regulatory approval, reimbursement, and procurement. The speed of the response showed how effective such cooperation between the public and private sectors was for emerging technologies. Because new drugs also often require additional data collection after launch, stronger public-private partnership is needed to ensure that robust and appropriate data are collected. This is especially true for new and emerging technologies such as ATMPs and other genomic and precision medicine treatments, as the Oslo Medicines Initiative and Access to Novel Medicines Platform contend.³⁰ Although building such infrastructure requires substantial investment in resource constrained times, working together could provide economies of scale.

Key messages.

• Development of gene and cell and other complex therapies are expected to increase substantially

• Current ways of assessing the value of novel medicines, especially for complex therapies, are inadequate and are leading to unsustainable costs for payers and limited access for patients

• Stronger dialogue between countries, patient organisations, and industry—for example, through the Access to Novel Medicines Platform—could help explore sustainable and innovative access mechanisms such as managed entry agreements