1. Health Technology Assessment for Pharmaceuticals and New Medical Technologies - Where are we now? The industry perspective Jenny Hughes, Director, Vaccines & External Affairs

2. GlaxoSmithKline Mission & Strategy To improve the quality of human life by enabling people to do more, feel better and live longer

3. Deliver More Products of Value “To be successful in the healthcare marketplace in the next few years its all going to be about delivering value.“ Andrew Witty, CEO 1.Enhanced R&D productivity and increased externalisation for drug discovery 2.Sustaining a late stage pipeline 3.Number of filings & reimbursable product approvals

4. Bridging the “Value Gap” Short-term data Surrogate endpoints Limited Comparators Broad population What R&D provided in the past Evidence of meaningful benefit on survival/QOL over relevant comparators in a select well-defined population at a justifiable price What is needed now The Value Gap Bridge: the Reimbursable File

5. How does a reimbursable file relate to a regulatory file? Incremental clinical benefit is a necessary, but not sufficient condition. Payers look at the: Unmet economic as well as clinical needs Incremental benefit relative to the payer’s choice of comparator Economic (and social) significance of the clinical benefit Confidence that benefits will be replicated in real world practice Quality of evidence Extent of risk of inappropriate resource use and budget overspend Incremental clinical benefit is a necessary, but not sufficient condition. Payers look at the: Unmet economic as well as clinical needs Incremental benefit relative to the payer’s choice of comparator Economic (and social) significance of the clinical benefit Confidence that benefits will be replicated in real world practice Quality of evidence Extent of risk of inappropriate resource use and budget overspend

6. Health Technology Assessment  What is HTA? – It is the process of using existing evidence to evaluate the clinical effectiveness, cost effectiveness & broader impact of a health technology on patients and the healthcare system

7. Health Technology Assessment at is Cost Effectiveness? € Threshold <= Cost (new drug) – Cost (existing drug) QALY (new drug) – QALY(existing drug) Cost-effectiveness Test = Approx € 20,000 1 QALY <= Cost (new drug) – Cost (existing drug) QALY (new drug) – QALY(existing drug) Irish Cost-effectiveness Test =

8. Putting into balance the extra-benefit against the extra-cost at threshold level 1 QALY € 20,000 Health Technology Assessment

9. HTA guiding principles 1. HTAs should be based on a clear, sophisticated and differentiated view of what constitutes value 2. HTAs should be transparent and balanced 3. HTAs should be based on early and inclusive dialogue, including with patients 4. Evaluations should be flexible to allow new data to be considered 5. Risk-sharing and flexibility is required in handling uncertainty 6. Comprehensive understanding of the benefits of a drug in disease management is needed 7. Payers should commit to rewarding added value 8. Positive HTA outcomes should be implemented 9. HTA should apply to all healthcare interventions

10. “Earning Trust, Leading Innovation, Helping More Irish Patients”

11. Reimbursement process for new medicines  Pre 2006, Automatic reimbursement for new medicines  September 2006, “HSE reserves the right to assess new and existing technologies (pharmaceuticals, diagnostics and devices) that may be high cost or have a significant budget impact on the Irish healthcare system.”  September 2009, All new products applying for reimbursement subject to a preliminary rapid review to determine if HTA is required.

12. Irish Reimbursement Process Present pipeline CPU/NCPELicence granted Company submit reimbursement application to CPU NCPE ask company to complete rapid review form Yes HTA No HTA

13. Considerations during the rapid review process  Therapeutic area?  What is the appropriate comparator ?  Is there a significant price difference between the new product and the comparator ?  Are there advantages over the comparator ?  Budget impact?  Any pharmacoeconomic data available?  What is the situation in UK/Europe?

14. Examples Rapid Review Criteria Eltrombopag (ITP)Pazopanib (RCC) Is SOC clear?NoYes Is it better/as good as comparator? Comparator unclearYes Is it cheaper than comparator? Comparator unclearYes Budget impact?Comparator unclearNo Is the NCPE familiar with the area? NoYes Yes HTA No HTA

15. HTA Process Yes HTANCPE scoping meetingCompany submit HTA dossier+90 days NCPE evaluation time NCPE publish recommendation on website CPU decide whether to reimburse Company re-submit reimbursement application

16. The HTA Content Executive Summary Section 1 – Background Section 2 – Clinical Evidence Section 3 – Description of Economic Evaluation Section 4 – Results of Cost-Effectiveness Analysis Section 5 – Analysis of Uncertainty Section 6 – Budget Impact Analysis

17. Health Technology Assessment Positive HTAUncertain HTANegative HTA AcceptReject Price negotiation Risk sharing schemes AcceptRejectAcceptReject Value for money?

18. HTA guiding principles – How does the Irish system 1. HTAs should be based on a clear, sophisticated and differentiated view of what constitutes value 2. HTAs should be transparent and balanced 3. HTAs should be based on early and inclusive dialogue, including with patients 4. Evaluations should be flexible to allow new data to be considered 5. Risk-sharing and flexibility is required in handling uncertainty 6. Comprehensive understanding of the benefits of a drug in disease management is needed 7. Payers should commit to rewarding added value 8. Positive HTA outcomes should be implemented 9. HTA should apply to all healthcare interventions

19. Reimbursement Timelines Conditional reimbursement now a feature of the Irish system

20. Conclusions  Reimbursement & HTA processes are evolving  Requirements are more sophisticated  Greater role of “expert patients” in HTA process  Need for guiding principles around risk sharing arrangements  Time to market is more unpredictable, greater transparency on decision making post HTA decision required