Pharmaceutical and risk-sharing modelling


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Milliman is a key player in this niche market and works with a variety of stakeholders, including pharmaceutical companies, health technology appraisal bodies, government health officials and third-party payers. By proposing ways to reallocate financial risk within the system, our team focuses on the key sources of uncertainty to design risk-sharing arrangements and other alternative reimbursement mechanisms. We are at the forefront of applying actuarial approaches in the healthcare and public health space and have been involved with determining the value of new health technologies such as novel antibiotics and other high-cost therapies. We also excel at bridging the gap between value and reimbursement of new technologies and highlighting key insurance considerations associated with any proposed alternative payment models.

We rely on actuarial cost models to present cost and medical service utilisation of a treatment group versus a control group. This allows us to capture any differences between various population groups over time and across a range of service categories, and helps with quantifying the budget impact of any given intervention. We are practiced at presenting our modelling results from a variety of payers’ perspectives, both public and private. We also perform sensitivity analysis and scenario testing to measure the impact of changes in selected model assumptions. We rely on actuarial approaches to inform the monitoring of key assumptions over time, ultimately feeding in any subsequent risk-sharing arrangements. This is particularly relevant given the context of changing demographics and population ageing.

Our UK team draws on the expertise of health economists, clinicians and actuaries to collaborate on a range of health challenges with implications for England and beyond. We have access to proprietary real-world data to inform the parameterisation of our modelling and support any literature review that we conduct through peer-reviewed sources. Our prior research was also presented at pharmaceutical-sponsored events like International Society for Pharmacoeconomics and Outcomes Research (ISPOR) and was featured in actuarial publications. The resulting white paper on financial risk and uncertainty in new health technologies presents examples of potential risk-sharing between stakeholders using recent Hepatitis C drugs for illustrative purposes.

Other current areas of focus include the financial impact to payers of genetic testing and high-cost technologies targeting rare diseases and genetic disorders.