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Value of Information in relation to risk management

Prof. Dr. Jan J.V. Busschbach

Change in policy

Now: evaluate all new medication Future: only when risk are high

When is an economic evaluation useful? When there is doubt about cost effectiveness

Low on information about cost effectivenesss

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The 3 meanings of doubt

1. The cost effectiveness might be invalid Methodologically unsound

The CFH judges the validity using guidelines

2. The cost effectiveness might be to high To high = bad

The ACP values the height of cost effectiveness

The CFH has no judgment

3. The cost effectiveness might be uncertain Much error variance

Unclear who is dealing with this….ACP? CFH?

Room for more risk management

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Uncertainty is linked to CE-ratio

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Interested in both costs and effect

Less effective More effective

Low costs (savings)

High costs

Not cost effective

cost effective

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Sensitivity analysis

Less effective More effective

Low costs (savings)

High costs

Superb!

Forget it!

Difficult…

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Good

Better

Cost-effectiveness plane

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Not cost effective

Cost effective

Cost Effectiveness Acceptability Curve (CEAC)

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Risk management

We can judge if we are in need of more information

Value of Information analysis

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Value of Information (VoI)

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Low VoI

High VoI

Low VoILow reduction of risk

Low reduction of risk

High reduction of risk

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Risk management

Make prototype cost effectiveness analysis Do a value of information analysis Triage:

Unconditional reimbursement:

• If CE-ratio is far much below threshold

• Value of information is (most likely) low

Conditional reimbursement

• If CE-ratio is close to threshold

• Value of information is high

Unconditional reject of reimbursement

• Value of information is low

Arguments not to do so…

We should reimburse all effective drugs We should evaluate all (new) effective drug

Assumes that we have the resources to do so

We do not have a threshold We can not make acceptable prototypes

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We have an indication of a threshold…

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Wetenschappelijke Raad voor het Regeringsbeleid, 2006

Example prototype model: Lucentis evaluated in the ACP

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Patel et al, 2010

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Avastin versus Lucentis

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Conclusion

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Risk management relates to value of information

Conditional reimbursement can be done on prototype cost effectiveness analysis

Only invest in (cost-) effectiveness, if Risks are high

Value of Information is high

CFH procedure

Standard procedure Test of the validity of the cost effectiveness analysis

Using the guidelines

Orphan and expensive hospital drugs Conditional reimbursement

Approval of a four year data collection

• To arrive ad a valid cost effectiveness analysis

After 4 years

• Test of the validly of the cost effectiveness analysis

Using guidelines

Valuing cost effectiveness = other committee Advies Commissie Pakket (ACP)

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Uncertainty relates to threshold

If: CE-ratio = € 15.000 per QALY Threshold = € 25.000 per QALY Then intervention is cost effective

But what if CE-ratio is an interval: Threshold = € 25.000 per QALY CE-ratio = € 10.000 till € 30.000 per QALY Then intervention might be cost effective

If: Threshold = € 11.000 Then intervention most likely not cost effective

If: Threshold = € 29.000 Then intervention is most likely cost effective

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65 Citations in PubMed

1997 [pdat] AND "value of information analysis"

0

2

4

6

8

10

12

1996 1998 2000 2002 2004 2006 2008 2010 2012

Pu

bli

cati

on

s

Why is evidence valuable?

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How things could turn out

Net Health Benefit Best we could do if we knewTreatment A Treatment B Best choice

Possibility 1 8 12 B 12

Possibility 2 16 8 A 16

Possibility 3 9 14 B 14

Possibility 4 12 10 A 12

Possibility 5 10 16 B 16

Average 11 12 14

How much evidence?

What’s the best we can do now? Could we do better?

Maximum value of more evidence is 2 QALYs per patient

Choose B Expect 12 QALYs, gain 1 QALY

But uncertain Wrong decision 2/5 times

If we knew Expect 14 QALYs

Methods

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Treatment A

QALY Cost

Clinical effect

Disease Progression

QALY

Costs

Rand

om

s

ampl

ing Asymptomatic Progressive

Dead

Treatment A

Asymptomatic Progressive

Dead

Treatment B

Model Structure

Treatment B

QALY Cost

1 £10,000

2 £30,000

0 £ 5,000

3 £20,000

2 £15,000

4 £40,000

1 £10,000

3 £30,000

Is the evidence sufficient?

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How things could turn out

Net Health Benefit Best we could do if we knewTreatment A Treatment B Best choice

Possibility 1 9 12 B 12

Possibility 2 12 10 A 12

Possibility 3 14 17 B 17

Possibility 4 11 10 A 11

Possibility 5 14 16 B 16

Average 12 13 13.6

Would more evidence improve health?

What’s the best we can do now? Could we do better?Choose B, expect additional net benefit of 1 QALY Get an extra 0.6 QALY

Maximum benefit of more evidence is0.6 QALYs or £12,000 per patient

Right decision 3/5 times (p = 0.6)

Wrong decision 2/5 times (1-p = 0.4)

How uncertain is the decision?

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0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1

£0 £10,000 £20,000 £30,000 £40,000 £50,000 £60,000

Cost-effectiveness threshold

Pro

ba

bili

ty c

ost

-effe

ctiv

e

B

A

C

Choose A Choose B

ICER = £25,000 per QALY

Do we need more evidence?

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£0

£5,000,000

£10,000,000

£15,000,000

£20,000,000

£25,000,000

£0 £10,000 £20,000 £30,000 £40,000 £50,000 £60,000

Cost-effectiveness threshold

Ma

xiu

m b

en

efit

of

evi

de

nce

.

Choose A Choose B

Cost of research

Cost of research

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Alan Williams

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