Product details

Historically, the biggest obstacle that healthcare innovators, such as pharmaceutical and medical device manufacturers, needed to overcome on their way to market was securing approval by the US Food & Drug Administration (FDA) or other international regulatory authorities. However, in the last decade, a new (sometimes even more challenging) hurdle had to be cleared: insurance coverage and reimbursement. Payers - either public payers, such as Medicare in the US and the National Health Services (NHS) in the UK, or private commercial payers, such as Blue Cross / Blue Shield and UnitedHealth Group - could deny coverage for a technology that had received regulatory approval if they determined that the supporting evidence did not adequately demonstrate that the technology was superior to existing treatment alternatives that were already being reimbursed. This had the potential to create a potentially adversarial relationship between payers and innovators in cases where they had conflicting interpretations of the evidence regarding the cost, benefits, and risks of new technologies. The challenges to innovators in managing this conflict are illustrated in this case study by an example: the 2006 decision by the UK''s NHS to deny coverage for Exubera, a new form of inhaled insulin. The learning objectives of this case are to help readers: (1) evaluate the pros and cons associated with the role payers are increasingly playing in the adoption of new technologies; and (2) consider the arguments for and against the requirement faced by companies to collect cost effectiveness data in their clinical trials.