The development and registration of a medicine for a new indication can justify a higher price. Regulatory requirements, dossier development, and additional studies all involve costs and risks. But how much more are we willing to pay for a medicine that has already been used off-label in clinical practice for many years? And how does such a price relate to the actual investments made?

In a recently published article by Medicijn voor de Maatschappij and RARE-NL, a transparent cost-based plus model was developed for bevacizumab to help answer these questions. This cancer medicine has been used off-label for various eye conditions for many years, but until recently it had never been officially registered for macular degeneration. A registered variant has now entered the market at a price substantially higher than the existing off-label use. This raises questions not only about the affordability of medicines within limited healthcare budgets, but also about how we should approach pricing in drug repurposing, when an existing medicine is further developed for a new, officially registered indication.

In the model developed by the researchers, development, production, and administrative costs are systematically mapped and translated into a substantiated price that supports patient access while also preserving incentives for investment in drug repurposing. The results show that the current price is difficult to justify based on the underlying cost structure. At the same time, the analysis makes clear that investments in drug repurposing can justify a higher price than existing generics or biosimilars, provided that this price remains proportionate to the costs incurred and risks taken. In this way, a cost-based plus approach can contribute to better substantiated reimbursement decisions and a more sustainable business case for repurposing.

This aligns with our broader aim to improve patient access, make prices more transparent and better substantiated, and create sustainable incentives for socially responsible medicine development.

Read the article here: Repurposing biosimilars, rethinking costs: a framework for sustainable drug pricing for repurposed bevacizumab for intravitreal injections | The European Journal of Health Economics | Springer Nature Link