Today, W2O is launching Recommended Value, a hub for news and commentary about the way health care value, price, access and reimbursement is evolving. It extends the work we’ve been doing with our industry-leading newsletters for more than five years, allowing W2O to expand our analysis and curation and bring more visibility to these critical issues.
We’ll include W2O analytics, perspective from our Redeeming Value podcast, critical context on the topics of the day, as well as access to our curated roundups of breaking news.
There may be not topic more important than the question of how patients and society will pay for tomorrow’s medical breakthroughs, yet the conversation around this topic is often opaque, making it difficult for stakeholders to make the right decisions.
This was driven home two weeks ago, when two striking pieces of news broke on the same day.
First, research was published that showed that medicines were responsible for 35% of the increase in life expectancy in the quarter-century since 1990. That’s about three times more than all other medical interventions combined, despite the reality that medicines make up only about 16% of health care spending. (Listen to our podcast with one of the study’s authors.)
At the same time, Gallup published its annual survey on corporate reputation, finding that the reputation of the pharmaceutical industry remains underwater: only 34% of Americans think positively of pharma, and while that’s up from the lowest-ever figure of 27%, recorded a year ago, it’s still abysmal.
The two findings, juxtaposed, raise an existential question for the pharmaceutical industry: in the face of so much evidence that medicines are making a difference in the lives of Americans, why does the public think so little of the industry?
It’s not because of a lack of ingenuity. Not only can the impact of medicines be seen in life expectancy, the pace of new drug approvals has never been faster. The innovation brought to bear has never been more striking, and industry’s response to the pandemic has been extraordinary.
Instead, the reputational anchor is drug pricing. Railing against out-of-control drug prices may be the only bipartisan activity left in the country; both President Trump and former Vice President Joe Biden have suggested radical reforms to smash the existing pharma business model to create lower prices.
The irony, of course, is that the practical impact of drug prices should be waning. The nation’s largest purchaser of medicines, the pharmacy benefit managers that cut deals on behalf of insurance companies, say that drug prices are basically flat and certainly well below inflation. Four of the six companies that price data say that the price they receive for their medicines fell last year. All have seen list price increases drop steadily for five years.
But that’s not a story that’s often told. Indeed, these are not always easy stories to keep track of, let alone tell in a compelling, accurate way that can inform an educated discussion about the future of health policy. That’s the challenge we’ve set for ourselves with Recommended Value: illuminate this most important conversation in a way that drives to a better future, not a more confusing one. We’re up for that challenge.