ICER to Work With VA on Drug Price Negotiations

Posted 03 July 2017 By Zachary Brennan


In a first for the Institute for Clinical and Economic Review (ICER), which estimates the cost-effectiveness of drugs, the Department of Veterans Affairs (VA) Pharmacy Benefits Management Services office (PBM) has agreed to use ICER drug assessment reports in drug coverage and price negotiations with the pharmaceutical industry.

ICER says it will work with staff in the VA to integrate ICER reports into the VA formulary management process of evaluating the comparative clinical effectiveness and value of drugs.

The VA requires that drug manufacturers offer a 24% discount off a drug’s average price or the lowest price paid by other (nonfederal) buyers, in addition to further discounts if a drug’s price outstrips inflation, according to the Commonwealth Fund. The VA also directly negotiates lower prices with drug manufacturers, and with ICER’s help may establish a new norm for how the government can obtain lower-priced drugs.

“All ICER reports are in the public domain, but we will work closely with the VA to support its efforts to consider the findings of our reports in the context of its own population. We will also assist the VA in exploring new ways it can use the reports to continue to provide a safe, effective and sustainable prescription benefit while more closely aligning a drug’s price with the value it provides to Veterans and the US taxpayer,” said ICER President Steven Pearson.

ICER will also work with VA staff to develop options for using “value-based price benchmarks” suggested in ICER reports. The most recent evidence report from ICER deals with abuse-deterrent opioids.


But not everyone is pleased with ICER’s teaming up with the VA. The National Pharmaceutical Council (NPC) last week expressed “some concerns” with the collaboration.

While payers routinely update coverage decisions as the evidence evolves, NPC said that “ICER assessments are a static representation of evidence at a point in time. ICER does not conduct routine updates to its assessments as new findings become available, in fact it has only conducted a supplemental ‘brief evidence update’ one time.” 

The NPC also called for the VA and ICER to ensure that a wide array of evidence is used and regularly updated, and that other frameworks and stakeholder input are considered.

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Categories: Drugs, Government affairs, Regulatory intelligence, News, US

Tags: ICER, VA, drug prices

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