however, collecting this new and complex evidence, especially in the preapproval
phase of the technology’s development, is proving difficult and costly and the
incentives to do so might be less than perfect at the moment (both for payers and
the industry), which also affects the uptake of diagnostic tests.
However, generating evidence is very important. A review of the factors
influencing the reimbursement of existing personalized medicine technologies by
Meckley and Neumann ( 2010 ) has shown that the strength of evidence available for
existing personalized medicine technology varies widely but appears to be the
strongest predictor of reimbursement. The review concluded that in order to achieve
favorable coverage and reimbursement and to support premium prices, manufac-
turers will need to bring better clinical evidence to the marketplace and better
establish the value of their products.
The generation of evidence may be stimulated by the incentives for drug-test
codevelopment^42 since diagnostic tests will likely become increasingly important
for optimizing the use of drugs (especially to treat cancers), which means that the
economic assessments may be more often performed for the drug-test coproducts,
instead of single test assessments, and some of the methodological concerns may be
eased while others emphasized. On the other hand, the incentives to generate more
and better evidence needs to be more explicit and improved, both for payers and for
producers, although there seems to be a lack of consensus on the right type and
amount of incentives.^43 Generating robust end-to-end evidence is very costly, and
economic incentives, such as better pricing (e.g., value-based pricing instead of
reference pricing) and public funding of evidence collection, may be needed to
generate it.^44 Where large studies with long follow-up periods are needed as part of
companion diagnostics development, the high cost of this development may not be
justified at the rates at which companion diagnostics are usually reimbursed.^45
4.3 The Value of Personalized Medicine
The majority of currently published cost-effectiveness analyses and particularly
those used to inform national-level decision making by bodies such as NICE in the
UK tend to focus on understanding the incremental costs and benefits of a single
technology, such as a pharmaceutical. In most jurisdictions and particularly across
Europe, the diagnostic component is not yet defined as a particular “product”^46 and
(^42) Danzon and Towse ( 2002 ), pp. 5–13.
(^43) For further discussion on this issue, we refer readers to Frueh ( 2013 ), pp. S21–S37; and Garrison
and Towse ( 2014 ), pp. 484–490; Burns et al. ( 2013 ), pp. 16–19.
(^44) Payne and Annemans ( 2013 ), pp. 32–38; Towse et al. ( 2013 ), pp. 288–305.
(^45) Frueh ( 2013 ), pp. S21–S37.
(^46) Annemans et al. ( 2013 ), pp. 20–26.
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