Industry Urges Caution Over Japan HTA Plans

Japan may have decided to dip an exploratory toe in the waters of health technology assessment, but the research-based pharma industry is continuing to voice early caution over potential shortcomings in methodology and expertise, and to stress the need for a holistic approach.

Japan's Ministry of Health, Labour and Welfare (MHLW) has decided on a trial health technology assessment (HTA) program to be initiated in 2016, which will be applied initially only to a limited number of existing approved drugs.

Under the pilot, 10 products will be selected for assessment, but the process will be "very different to NICE [The National Institute for Health and Care Excellence] in the UK," stressed Toshio Miyata, executive director of the Health and Global Policy Institute in Tokyo, a neutral, non-profit organization set up in 2004 to study and recommended domestic and international health policies.

The final details of the scheme have yet to be decided, but the emphasis of initial HTA efforts in Japan is likely to be more on pricing considerations rather than the more fundamental question of whether a drug should be reimbursed by the national insurance scheme or not, he suggested.

Whereas NICE has made sometimes controversial decisions that have resulted in approved products not being eligible for reimbursement in the UK, Miyata told a Japan policy session on the IBC Oncology Asia meeting in Tokyo that "In Japan there is no case of an approved drug not being covered by [national] insurance."

Simon Collier, director general of the Japan arm of European industry federation EFPIA, told the meeting that cost-effectiveness assessment is likely to be used in Japan for the re-pricing of existing products. Although selection criteria are still unclear, these may include significant budget impact and a high unit/daily price.

A 2014-15 pilot project has been looking at how HTA has been applied in Japan and elsewhere to five drug and three device products, he told the same meeting.

Ideas for some sort of stand-alone HTA system in Japan have been floating around for some years, and a recommendation to applicants to include pharmaco-economic data in regulatory submissions was first made back in the early 1990s.

However, the concept did not take off and other research has shown that after an initial spike, the proportion of products for which such evidence was provided has been falling steadily.

Then in 2011, the Committee on Health, Labour and Welfare formally proposed the use of HTA to assess medical innovation. A special committee on cost effectiveness evaluation under the Central Social Insurance Medical Council (Chuikyo), which advises the ministry on pricing affairs, held its first meeting in May 2012, and a roadmap for the partial introduction of HTA was issued in 2014.

The draft principles for the use of HTA stated that products for orphan diseases would be excluded, with the focus to be more on those for which safety and efficacy are established, but for which various treatment alternatives exist that may have major differences in health system financial impact.

Some other Asian markets such as South Korea and Taiwan do already include components of HTA in their regulatory systems. South Korea, for example, uses HTA to inform reimbursement decisions, in a process that has resulted in price cuts and has added to the regulatory timeline.

Industry Worries

The research-based pharma industry in Japan has been wary of HTA proposals since the beginning, with the main industry association, the JPMA, warning back in 2012 that HTA should not be used to limit reimbursement or drug access, or to cut prices for cost containment reasons.

It also pointed to database weaknesses and the lack of comprehensive epidemiology data in Japan, along with the possible need to revise clinical trial design, claiming somewhat alarmingly that HTA might "negatively impact the very fundamentals of the Japanese healthcare system."

With the recent progress towards the pilot system, the US association Pharmaceutical Research and Manufacturers of America (PhRMA) took the opportunity to lay out its detailed position and make suggestions on HTA at a recent seminar in Tokyo.

David Grainger, chair of PhRMA's international HTA task force and a board member of Health Technology Assessment International, highlighted in particular concerns over delayed patient access to new drugs through the need for additional data assessments, and the potential discouraging effect on innovation.

PhRMA's basic position is that "In Japan, HTA has already been incorporated over many years under the current reimbursement and pricing systems without negative impacts on patients' access," he said.

For instance, drug pricing premiums are awarded on top of a basic calculated price (derived from a comparator or cost basis) for criteria such as innovation and medical usefulness. As such, the (albeit complex) system takes account of various costs and benefits and the efficacy and safety of a product, with the innovation premium having been welcomed by the R&D-based industry (Also see "EFPIA Sees Room For Improved Japan Innovation Rewards" - Scrip, 22 Dec, 2014.).

Nevertheless, there are opportunities to enhance the system to better reward innovation and assess treatment options, Grainger said.

A number of reasons for the adoption of centralized HTA systems in other countries such as the UK also do not apply to Japan, he argued, given that all drug prices in the market are already controlled by the government, growth in health spending is similar to that in GDP, and there is a fully universal healthcare and pricing scheme.

Key Proposals

PhRMA is thus proposing four basic policy goals for an HTA framework in Japan: to maintain patients' access at the current level; ensure appropriate assessment of the holistic value of treatment options; to minimize burdens associated with value assessment; and to ensure sufficient rewards for innovation.

Key within these suggested objectives is the need to maintain prompt reimbursement of a new product following approval, Grainger stressed, given that long delays that can be caused by HTA in other markets.

He pointed for example to the UK, where such processes can take up to 54 weeks of the total 60-week approval-to-launch period in multiple technology appraisals, and South Korea, where HTA can take over half of the 38-week same period.

Japan by comparison currently has a much shorter period from approval to launch, of roughly nine weeks.

In terms of holistic approach, PhRMA proposes that a range of both direct and indirect costs and benefits be considered. For instance, this should include consideration of impact on labor productivity, and costs as well as on medical cost savings and quality of life.

The US association pointed at the seminar to shortcomings in the standard quality-adjusted life years (QALY) measure, which is required in the UK and recommended in several other countries adopting HTA.

There are limitations and no universal methodology, and QALY has been criticized for its lack of consideration of societal value and patient preferences, although research into more comprehensive “multi-criteria decision analysis” is underway in several major markets, Grainger noted.

He pointed to the advanced state of such discussions in the Netherlands, where flexible thresholds depending on disease severity are used in areas such as societal affordability and therapeutic effectiveness.

Expertise Lacking

Other major concerns over the introduction of a formal HTA system in Japan - expressed previously by industry groups - include the lack of a dedicated HTA agency, and a shortage of experts to actually conduct analyses.

Grainger highlighted the low number of basic clinical research studies with cost effectiveness analyses performed in Japan, and a lack of professional expertise as evidenced by published manuscripts on health economics in leading journals (243 from Japan in 2009-14 versus 8,882 from the US).

There are also only 210 members of IPSOR (the International Society for Pharmacoeconmics and Outcomes Research) from Japan, compared with 3,600 each from the US and EU.

Amid the ongoing moves in Japan, the over-riding message from PhRMA was that HTA is a complex topic and that much of the framework for such evaluation, including definitions, precise methodology and application of the results, still need to be discussed and established in the country.

The field is also a fluid one, with HTA systems elsewhere being revised to better balance access, costs and innovation, and Japan needs to evolve optimal approaches that put patient outcomes first, Grainger stressed.

"It will be important to recognize both the strengths of the current processes in Japan and the limited capabilities for full HTA today," he concluded.