ICER’s 2023 Value Assessment Framework Updates: How Might Changes Impact Pharmaceutical Companies?

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Article contributed by Naoko Ronquest (she/her), PhD, Executive Director, US HTA Strategy and Early Modeling and Kyle Paret, PhD, Associate Director, Health Economics with RTI Health Solutions.

ICER’s New Value Assessment Framework

On June 5, 2023, the Institute for Clinical and Economic Review (ICER) released proposed changes to the 2020-2023 value assessment framework. In reviewing the changes proposed in this framework, we identified the following as critical for stakeholders who may be engaging with ICER after September 2023 when the framework is finalized.

Comparative clinical effectiveness:     

Long-term cost-effectiveness:

Potential other benefits and contextual considerations:


How Will These Key Changes Affect Future Collaboration with ICER?  

ICER proposed to include a new subsection "Clinical Trial Diversity” in each assessment with an overall diversity rating for interventions evaluated    

In this new subsection, ICER will evaluate the racial, ethnic, age, and gender diversity of the studied population for each intervention being assessed. An overall diversity rating (good, fair, poor) will be provided for race/ethnicity, sex, and age (adults 65 and older). The ratings represent how well the United States (US) trial population compares with the distribution observed in the population with the condition across each demographic category.

A higher diversity rating is likely to differentiate treatments when multiple therapies are being assessed. Although this new rating may not have a direct impact on how payers view the clinical effectiveness of new therapies, we recommend that all stakeholders developing new treatments marketed in the US to:  

  • Consider publishing trial design and demographic information ahead of first availability of the study outcomes
  • Strengthen trial recruitment strategy to ensure that each clinical study has a recruitment target to ensure the distribution of study subjects across racial/ethnic groups, age, and gender are similar to the overall US population affected by the condition
  • Submit study population characteristic tables for the US-based subpopulation during ICER’s open-input periods  

ICER plans to provide an a priori list of key subpopulations of interest in each scoping document

Under the new framework, ICER proposes to provide an a priori list of key subpopulations of interest and scientific rationale for wanting to evaluate these subgroups in the scoping document. When new interventions’ effects are heterogeneous across different groups of patients, it is critical for patients and providers to be aware of sources of such heterogeneity and understand when to worry about such differences across subpopulations. In each assessment report, ICER will evaluate the credibility of the subgroup claim and provide evidence rating by subgroup if supported by data.  

Although evidence ratings have been provided by subgroup in previous ICER reviews, this new framework highlights the continued importance of subgroup evaluation. Manufacturers anticipating unique benefits in key subpopulations need to ensure there is high certainty evidence to support the claim. Based on these changes, we recommend stakeholders:  

  • Consider potential differences in treatment efficacy in subgroups and identify key subgroups that may provide more opportunities 
  • If the likely labeled indication is broader than the population studied in the pivotal trial, establish a strategy for rationalizing why the treatment effect should be similar in the broader, indicated population
  • When certain key subpopulations are associated with less prominent treatment effect, consider conducting and publishing studies that support alternative value of the new therapy

For long-term cost-effectiveness analyses, ICER proposed a dynamic pricing scenario for small molecule and biological products targeted to Medicare-eligible populations

To reflect future Centers for Medicare & Medicaid Services price negotiation under the Inflation Reduction Act, ICER plans to conduct dynamic pricing scenario. For drugs that are predominantly targeted to Medicare-eligible populations, ICER will conduct key scenarios reflecting changes in drug pricing over time. For example, ICER proposes that the price of small molecule drugs should be set at 75% of the launch net price at 9 years after launch. Similarly, for biologic agents, ICER will assume 65% price reduction at 13 years after launch. ICER also plans to review whether loss of exclusivity or Centers for Medicare & Medicaid Services negotiation is expected among all active comparators and allow for prices of these drugs to vary over time. Manufactures should investigate key scenarios that may impact the new treatment’s assessed value.  

What does this mean to you? 

  • Dynamic pricing scenarios for small molecule and biological products targeted to Medicare-eligible populations may vary significantly from base-case results.
  • It is critical for manufacturers to prepare US cost-effectiveness models that implement realistic dynamic drug pricing assumptions under a variety of scenarios so that the impact of these assumptions is known before ICER’s assessment of each new product. 

ICER proposed to present a range of HBPB using both QALY and evLYG

Although ICER did not propose any change in its methodology for estimating HBPB, ICER suggested that it may present a range of HBPB using the lower bound (based on the incremental cost per QALY gain at the willingness-to-pay threshold of $100,000) and the upper bound (based on the incremental cost per evLY gain at the willingness-to-pay threshold of $150,000). We recommend companies that may be reviewed by ICER consider including evLYG as one of the key health outcome measures in early and late-stage global cost-effectiveness analysis models to be prepared for potential increased usage of benchmark pricing based on evLYG in the US. 

For long-term cost-effectiveness analyses, ICER has proposed an alternative method for estimating societal costs, when such data are lacking

ICER typically does not incorporate indirect costs in its cost-effectiveness analyses from the societal perspective when data informing the impact of new treatments is not available. To overcome this challenge, ICER proposes to incorporate the impact of an intervention on patient productivity and carer time using an indirect approach. The new method uses the published relationship between patients’ utility score and how they use their time to estimate the indirect impact (time at formal and informal work, household production, leisure time, and caregiver time). When this method is used, ICER also will incorporate patient-productivity time gained and patient-consumption costs during periods of life extension. 

Under the new framework, the cost-effectiveness analysis from the societal perspective might result in a significantly different outcome compared with the healthcare payer perspective. This means manufacturers should assess the strength of available published references to support the societal analysis (such as data mapped to modeled health states regarding patients’ and their caregivers’ lost wages and productivity, needs for nursing care, etc.) 

When data to support societal analyses are lacking (or only partially available), consider conducting a societal cost-effectiveness analysis using ICER’s method and prepare for the rationale for ICER to use the societal analysis as a co–base-case analysis.

Proposals Pertaining to Benefits Beyond Health and Special Ethical Priorities

In addition to the key changes pertaining to methods for conducting comparable clinical-effectiveness and long-term cost-effectiveness analyses, ICER proposed several key changes to address challenges around health equity. First, ICER proposed updating its current terminology to describe treatments’ benefits beyond health from “Potential Other Benefits or Disadvantages” to “Benefits Beyond Health.” Similarly, they propose that the term “Contextual considerations” be updated to “Special Ethical Priorities.” These changes are intended to ensure that these elements of value are not dismissed as “merely contextual.” Furthermore, ICER proposed a revised voting format around these topics (benefits beyond health and special ethical priorities) to ensure that the responses from panel members are more interpretable. Finally, ICER plans to enrich its patient engagement program to ensure diversity in patients representing the community and to facilitate improved health equity.  

Based on these changes, we recommend that manufactures: 

  • Engage with patient advocacy groups early to fully understand the value of benefits beyond health as well as the factors that contribute to comparative clinical effectiveness and cost-effectiveness, from patients’ perspectives
  • Continue to collaborate with patient advocacy groups to generate data supporting clinical and economic evidence (e.g., conduct surveys to obtain data on hours lost by the disease, health-related quality of life impact, burden of disease for different subpopulations, etc.)

Click on the authors' names below to learn more about their expertise or to reach out to them with questions. 

ICER will present final updates to the value assessment framework in a recorded webinar on September 28, 2023. To register for the webinar or review the full proposal, please click here: https://icer.org/assessment/value-assessment-framework-2023/#overview

Read more about our experience with ICER

How are United States ICER'S evidence ratings determined?: A systematic review of ICER'S evidence ratings in evidence reports for new drugs in 2020 and 2021.

The evolution of ICER's review process for new medical interventions and a critical review of economic evaluations (2018-2019): how stakeholders can collaborate with ICER to improve the quality of evidence in ICER's reports.

Effects of stakeholder engagement with ICER on cost-effectiveness of new interventions: lessons learned from a critical review of evaluations from 2018 to 2019.

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