Consideration Of Value-Based Pricing For Treatments And Vaccines Is Important, Even In The COVID-19 Pandemic

Health Affairs
Peter J NeumannDaniel A Ollendorf

Abstract

Prices send signals about consumer preferences and thus stimulate producers to make more of what people want. Pricing in a pandemic is complicated and fraught. The policy puzzle involves balancing lower prices to ensure access to essential medications, vaccines, and tests against the need for adequate revenue streams to provide manufacturers with incentives to make the substantial, risky investments needed to develop products in the first place. We review alternative pricing strategies (cost recovery models, monetary prizes, and advance market commitments) for coronavirus disease 2019 (COVID-19) drugs, vaccines, and diagnostics. Hybrid pricing strategies are undoubtedly needed in a pandemic, but even in a public health crisis, value-based pricing is important. Cost-effectiveness analyses can inform pricing. Ideally, analyses would be conducted from both a health system and a societal perspective. Incorporating the added value of social benefits into cost-effectiveness analyses does not mean that manufacturers should capture the entire societal benefit of a diagnostic, vaccine, or therapy. Such analyses can provide important information and help policy makers consider the full costs and benefits of products and the wide-ranging ...Continue Reading

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Citations

Feb 18, 2021·Expert Review of Pharmacoeconomics & Outcomes Research·Akira YuasaShunya Ikeda
May 3, 2021·Value in Health : the Journal of the International Society for Pharmacoeconomics and Outcomes Research·Adrian TowseRachel Silverman
Jun 5, 2021·Health Services Research·Peter J NeumannJoshua T Cohen
Jul 9, 2021·Applied Health Economics and Health Policy·Chris PainterYot Teerawattananon

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