Elucidating ICER’s methodologies for Unsupported Price Increase assessments  

Introduction

In 2017, the Institute for Clinical and Economic Review (ICER) received funding from Arnold Ventures to develop annual Unsupported Price Increase (UPI) assessments to identify whether drugs with recent substantial price increases are supported by clinical evidence. To date, 2 UPI reports have been published to account for price increases that occurred in 2017–2018 and in 2019, respectively; the next report evaluating price increases in 2020 will be available in November 2021. Recent payer research conducted by Xcenda in 2020 found that payers are using ICER’s UPI reports with two-thirds of payers (66%) reporting them to be somewhat to extremely useful and 61% reporting them as somewhat to extremely influential on coverage decisions. Therefore, it is important for manufacturers to be familiar with the methodological approach of these assessments to prepare for future negotiations with payers. This article discusses ICER’s approach to the UPI assessment, considerations for manufacturers, and reactions from stakeholders.

ICER’s findings from the most recent UPI assessment

The protocol for the most recent UPI assessment notes that ICER’s approach is to evaluate up to 13 drugs that have experienced substantial price increases in 2019, review changes in the evidence base for these drugs, and report on whether potential evidentiary support for price increases was found. Manufacturers are provided with opportunities for input on pricing estimates and new clinical evidence. Of the 10 drugs evaluated in the most recently published UPI assessment (Table 1), 7 were found to have price increases unsupported by new clinical evidence and 3 were found to have price increases that were supported by new clinical evidence. ICER estimated that the total increase in spending in the United States (US) over 1 year due to price increases for the 7 drugs found to have unsupported price increases amounted to $1.2 billion.  

Table 1. Drugs selected for UPI assessment in 2020

^aThis is not a determination that the new evidence necessarily justified these price increases.
Key: UPI – Unsupported Price Increase; WAC – wholesale acquisition cost.

Preparing for the next UPI assessment

In April 2021, ICER published a protocol outlining how they will conduct their next UPI assessment for price increases occurring in 2020. The protocol also describes how price increases will be identified, how manufacturers can engage with ICER throughout the process, and how the clinical evidence will be assessed. Table 2 notes the milestones and timeline for public input, manufacturer notification, manufacturer input periods, assessment, and final report.  

Table 2. Milestones and time frame for 2020 UPI assessment

Note: Milestones in darker color are forthcoming.
Key: UPI – Unsupported Price Increase.

Figure 1 describes how price increases will be identified. After resolution of any discrepancies about pricing estimates, the top 10 drugs remaining on the list will constitute the first part of the final list of drugs for evidence review. 

Figure 1. Drug selection process in UPI assessment protocol

ICER may also choose to review up to 3 additional drugs based on public input and selection criteria described in Table 3. ICER will not publicly announce the list of drugs due to concerns that manufacturers could be stigmatized while determining whether the price increase is supported.

Table 3. Selection process for additional drugs following public input 

Key: CPI – consumer price index; WAC – wholesale acquisition cost.

During the manufacturer input period, ICER will contact manufacturers of the 10 to 13 drugs and invite them to submit information on their drugs and/or competitor drugs to justify price increase. Examples of pertinent manufacturer evidence can be found in Table 4. Of note, information provided by manufacturers will be included in the final report and will be transparent to the public and policymakers.

ICER will then perform independent systematic reviews looking for new information from randomized controlled trials (RCTs) on benefits and harms within these indications which have been published or presented during the evidence review period. Although ICER will not independently look for information from sources outside of RCTs, they will assess both RCT and non-RCT information (eg, meta-analyses, economic models, and observational data) published or presented that is submitted by manufacturers. ICER will assign separate ratings to the quality of new evidence using 3-level Grading of Recommendations Assessment, Development and Evaluation (GRADE) (low, moderate, and high) and to the magnitude of new net benefit demonstrated by the new evidence or analyses. For evidence that is rated moderate or high quality, ICER will rate the new net benefit as none, small, or substantial using the ICER Evidence Rating Matrix.

Stakeholder perspectives on the UPI assessment

Despite national efforts to address drug affordability, stakeholders have had mixed reactions to ICER’s UPI assessments. 
In 2020, the National Academy for State Health Policy’s (NASHP) implemented a new law entitled, “Act to Protect Consumers from Unsupported Price Increases on Prescription Drugs,” which aims to levy fines on manufacturers with unjustified price increases and use the revenue to lower costs for consumers. NASHP’s new model law uses ICER’s annual UPI list to identify unsupported price increases and requires manufacturers of the drugs identified to report the total sales of the drug in that state to the state’s tax assessor, the list price of the drug for the current and previous year, and other relevant information. Health policy experts note that legislation pertinent to ICER’s UPI assessment is appealing for several reasons. First, they avoid the issue of how to evaluate the fairness of launch prices. Additionally, the recommendations are likely to hold up in legal challenges and are considered a policy win-win because they deter large price increases or generate revenue for the state when enforced against violators. 

Others have suggested these assessments are being used by payers to deny patient access to medications and nongovernment entities, such as ICER, should not be given the power to drive prescription drug access determinations. Some have also suggested there is a lack of context provided in the UPI report, noting that ICER should “not select only products that had price increases, but instead look at the overall US bill for prescription drugs.” The National Pharmaceutical Council (NPC) described the 2020 UPI report as an “unnecessary and misleading exercise,” which “should not be relied on by policy- or decision-makers.” Given that some therapies can be cost-effective over the long-term, particularly in terms of quality of life and reduced hospital stays, NPC recommends that UPI assessments need to provide a longer view of how prices, costs, and healthcare spending fluctuate over the years. Other concerns included economic analysis as well as the ability to influence legislation punishing manufacturers. 

Conclusion

Despite some notable limitations of ICER’s UPI assessments, recent payer research has shown that UPI reports may have an impact on coverage decisions. Therefore, stakeholders should engage with ICER throughout the UPI assessment process to provide feedback on which drugs should be selected for review. Manufacturers whose products are selected for review should be prepared to justify their cost and value with data-supported input, including, for example, real-world evidence, meta-analyses, and/or economic models, where appropriate. ICER is consistently evolving its approach to UPI assessments; so, it is important to stay informed of any changes to the methodology, timelines for providing feedback, and findings that might impact discussions with payers.

The article should be referenced as follows: 

Hydery T, Loos A. Elucidating ICER’s methodologies for unsupported price increase assessments. HTA Quarterly. Fall 2021. https://www.xcenda.com/insights/htaq-fall-2021-valq-icer/

Sources

• ICER. Unsupported Price Increase Report. 2020 Assessment. January 12, 2021. Accessed May 28, 2021. https://icer.org/wp-content/uploads/2020/11/ICER_UPI_2020_Report_011221.pdf
• ICER. Unsupported Price Increase Assessment. 2020 Protocol. June 19, 2020. Accessed May 28, 2021. https://icer.org/wp-content/uploads/2020/10/UPI_Revised_Protocol_20200715.pdf
• ICER. Unsupported Price Increase Report. 2019 Assessment. October 8, 2019. Updated November 6, 2019. https://icer.org/wp-content/uploads/2020/10/ICER_UPI_Final_Report_and_Assessment_110619.pdf
• Choi M, Hydery T, Tan R, Tennant L. Trends in the uptake and impact of the Institute for Clinical and Economic Review value assessment framework in payer coverage decisions from 2016 to 2020. Presented at: AMCP Annual Meeting; April 12-16, 2021; virtual meeting. 
• ICER. Unsupported Price Increase Assessment. Protocol. April 12, 2021. Accessed May 28, 2021. https://34eyj51jerf417itp82ufdoe-wpengine.netdna-ssl.com/wp-content/uploads/2021/04/UPI_2021_Working_Protocol.pdf
• ICER. Evidence rating matrix. Accessed May 28, 2021. https://icer.org/evidence-rating-matrix/
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• National Pharmaceutical Council. ICER pricing report: creating a dialogue or just playing for headlines? Accessed May 28, 2021. https://www.npcnow.org/resources/icer-pricing-report-creating-dialogue-or-just-playing-headlines
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• Riley T, Reck J. National Academy for State Health Policy. NASHP’s new model law penalizes drug manufacturers for unsupported price hikes. July 28, 2020. Accessed May 28, 2021. https://www.nashp.org/nashps-new-model-law-penalizes-drug-manufacturers-for-unsupported-price-hikes/
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