Exploring Health Economic Models: Key Tools for Evaluating Medicine Costs, Outcomes, and Policy Impact
Health economic modelling is a process for synthesizing and comparing the costs and outcomes of medicines or devices over a specified period of time in order to help decision-makers make informed decisions about policy development, treatment strategies, and resource allocation.
Types of health economic models
There are many different types of health economic models, but some of the most common include:
Cost-effectiveness models (CEMs): These models compare the costs of different interventions or treatments with the magnitude of benefit they produce. The objective of these is to determine the most cost-effective option for achieving a particular health outcome, often measured in terms of a specific health metric. Cost-utility Analyses (CUA) are similar to CEMs but place a special emphasis on measuring health outcomes in terms of quality-adjusted life years (QALYs), incorporating utilities as a tool to reflect the quality of life. Utilities are commonly measured with the use of the EQ5D instrument in clinical trials.
Markov Models are used to represent the progression of individuals through different health states over time. This is especially useful to analyze the cost-effectiveness / cost-utility of patients with diseases or conditions that have multiple stages or states.
Certain HTA bodies recommend the use of new medicines or devices if the Incremental Cost-Effectiveness Ratio (ICER), calculated by dividing the difference in costs between two interventions by the difference in their outcomes, is below a certain threshold. In some countries, the willingness to pay and, therefore, the cost-effectiveness thresholds might be modified based on certain factors (e.g. disease severity modifier for NICE). While in some countries cost-effectiveness / cost-utility assessments are mandatory and the key driver for reimbursement decisions, in other markets they are only supportive or issued by institutions such as ICER in the US which do not have a direct impact on funding decisions but still publish information available to decision makers.
Budget impact models (BIMs): A budget impact model is an economic assessment that estimates the financial consequences of introducing new medicines, medical devices, or other health technologies within a specific healthcare system. Some common factors that influence budget impact are the cost of health technologies, patient population size, treatment duration, market share, and any potential cost offsets.
Uses of health economic models
Health economic models are used for a variety of purposes, including:
- To inform reimbursement decisions: Health economic models are often used by payers to determine whether to reimburse a new intervention.
- To support market access strategy: Health economic models can be used to help pharmaceutical, medtech and biotech companies develop a market access strategy for their products.
- To inform clinical decision-making: Health economic models can be used to help clinicians make decisions about which interventions are most appropriate for their patients.
Justin Stindt Consultants is your agency to develop your economic models: cost-effectiveness / cost-utility and budget impact models
Justin Stindt Consultants is your agency with the right experts with extensive HEOR experience in developing the economic models you need to demonstrate the cost-effectiveness / cost-utility and budget impact of your product to obtain favorable HTA endorsement.
Justin Stindt Consultants as a pharma, biotech and medtech service provider has helped many clients develop economic models to support decision making and HTA appraisal. At JSC, our specialists’ commitment lies in partnering with our clients to deliver health-economic models that are fit for purpose, from a simple cost-effectiveness simulator to support early-stage decision making to fully developed cost-utility models for submission to HTA bodies such as NICE, SMC, AWMSG.
If you are looking for a vendor to support your health economic modelling needs, select a service provider that will support you with robust and flexible models. More than just a model supplier, Justin Stindt Consultants will partner with you and can provide full-service support including engagement with the authorities and expert advice by leading health economists to ensure your models meet HTA bodies’ requirements and serve as the basis for positive guidance for your product.
Contact our firm today to learn how we can tailor our services to meet your unique needs and enable demonstration of the economic value of your asset.
WHAT SETS OUR AGENCY'S PHARMA AND MEDTECH PRICING & REIMBURSEMENT STRATEGIES APART?
Put simply, our consulting company helps our clients determine what clinical evidence they will need to get their products reimbursed at an attractive price.
Our international team of consultants conduct thorough primary & secondary research to assess the willingness to reimburse and pay of key decision-makers and identify value proposition levers to maximize return on investment. Our team of specialists and consultants have access to a large pool of key decision-makers and experts in various fields, including payers at national/regional/local level, Health technology assessment bodies (HTA), and clinical key opinion leaders for in-depth interviews and advisory boards.
We deliver specific and actionable insight on payer resonating evidence, including endpoints, how to operationalize them, and the required effect size. Our consulting agency also determines the return on investment of different evidence generation programs, e.g., the impact on access, price, and forecasting that an investment in an additional trial delivers.
Our holistic approach integrates in-depth understanding of healthcare systems, costs & reimbursement, health outcomes, strategic vision, and business sense to provide solutions truly creating value and access. We tailor every pricing & reimbursement project to the exact needs of our clients and stay in contact throughout the whole length of the project to make sure our team of experts and partners develop and co-develop the best possible strategy for the medicine or medical device.
We work with clients of all sizes, from start-ups to big pharma, and offer Pricing & Reimbursement Strategies at all stages of the lifecycle, e.g., pharma companies launching new products, biotechs looking for a directional P&R strategy in the scope of Business Development & Licensing discussions, or start-ups in need of an early P&R strategy to convince investors of the P&R potential of their assets. Our agency, with a team of experts and consultants, is dedicated to ensuring your product navigates through the complex market access landscape effectively.
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