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Money back guarantee? A cost–benefit framework of performance-based agreements (PBAs) for the reimbursement of pharmaceuticals

A. Carletto, A. Cicchetti, S. Coretti, Vito Moramarco and M. Ruggeri ()
Additional contact information
A. Carletto: AIFA, Agenzia Italiana del Farmaco
A. Cicchetti: Catholic University of the Sacred Heart
S. Coretti: Catholic University of the Sacred Heart
M. Ruggeri: Catholic University of the Sacred Heart

Eurasian Business Review, 2019, vol. 9, issue 1, No 5, 89-101

Abstract: Abstract The aim of this paper is to provide an empirical framework based on a discrete-time Markov chain to assess the costs and benefits of Performance Based Agreements (PBAs) for the reimbursement of pharmaceuticals. We provide an empirical testing using a case study referring to a treatment recently approved for reimbursement in Italy. The implementation of this framework is challenging for the agencies dealing with pricing and reimbursement decisions given the uncertainty associated with the treatment effectiveness and safety. On the other hand, empirical evidence shows that the awareness of the expected costs associated with different reimbursement schemes is necessary to inform decision-makers.

Keywords: Performance Based Agreements; Pricing and Reimbursement; Pharmaceutical policy; Cost-benefit Analysis; Markov models (search for similar items in EconPapers)
Date: 2019
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DOI: 10.1007/s40821-018-0107-y

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Handle: RePEc:spr:eurasi:v:9:y:2019:i:1:d:10.1007_s40821-018-0107-y