Build a Budget Impact Analysis Model

8 page of writing is required.

A you tube given in the docs will help.

Sample is attached

Individual case study: 4
Starting population: hypothetical 1,000,000 commercial health plan; population growth of 1.7% per year
Indication: Moderate-to-severe rheumatoid arthritis (RA) who had an inadequate response to or who are intolerant of methotrexate (MTX)
Intervention of interest: monotherapy XELJANZ® (Brand) 5 twice weekly
Comparators to include (Brands):

Market uptake expectations (proportional from comparators): Year 1: 10%, Year 2: 15%, Year 3: 20%
Inputs: Drug acquisition costs only (wholesale acquisition cost)
Analyses:
Test which input (using +/- 25%) influences the PMPM most: price of XELJANZ®, market share uptake of XELJANZ®, or eligible population
Test the impact of taking all market share from ENBREL® only
2
Current and Projected Treatment Mix (without XELJANZ®) Year 1 Year 2 Year 3
ENBREL® 50 mg/ml once weekly 55% 57% 60%
HUMIRA® 40 mg/0.8 ml once weekly 45% 43% 40%

Objective: You are tasked with developing a budget impact analysis as an economic model and providing the total net budget impact per user per year, total net budget impact per member and the net per member per month (PMPM)

HCDA 5

1

5:
example summary deck

Weekend # 1: team presentation and individual assignment example

1

Budget Impact of product “X” in Patients with Disease “Y”
Team Name or Individual Name
Case study Number
2

2

The objective and research question
3
For a health plan of 1M members, the model estimates the budget impact in each year over a five-year period that would result from the introduction of Product “X” as a treatment option for patients with Disease “Y”
Two scenarios are compared:
Assumes treatment of patients with disease “Y” without Product “X” as a treatment option
WORLD WITHOUT PRODUCT X
WORLD WITH PRODUCT X
Assumes treatment of patients with disease “Y” with Product “X” as a treatment option
Budgetary impact is calculated as the difference in costs between the two scenarios
1M: One Million

3

Model overview
4
1 to 5 year(s) with 3 years as base case
Commercial: Patients with Disease “Y”
Medicare Advantage: Patients 65+ with Disease “Y”
Third-party payer in the US
Comparator A (Brand)
Comparator B (Brand)
Comparator C (Brand)
Comparator D (Generic)
Comparator E (Generic)
Comparator F (Generic)
Comparator G (Generic)
Comparator H (Generic)
To estimate the budget impact of Product “X” for Disease “Y”
OBJECTIVE
TIME HORIZON
PERSPECTIVE
POPULATION
COMPARATORS
Drug acquisition costs (2019 US Dollars)
Drug administration costs (2019 US Dollars)
COST INPUTS
Total scenario costs
Total cost per member per month (PMPM)
OUTPUTS

4

Model flow
5
Patients with Disease “Y” and failing 1st Line
ELIGIBLE POPULATION
Therapies without Product “X”
Therapies with Product “X”

TREATMENT MIX
Drug acquisition
Drug administration
Treatment Duration
TREATMENT COSTS
$
Total scenario costs
Total PMPM

MODEL RESULTS

Hypothetical plan of 1,000,000 members
TOTAL POPULATION
Patients with Disease “Y”
DISEASE

PATIENT POPULATION
DISEASE TREATMENTS

5

Epidemiology inputs
6
Input Commercial Medicare Advantage
Value Details Value Details
Disease “Y” 50.80% Source and methods to utilize 55% Source and methods to utilize
Failed 1st Line 23.81% Source and methods to utilize 100% Source and methods to utilize
Treated after 1st Line 1.65% Source and methods to utilize 4.60% Source and methods to utilize
With Recent Event 54% Source and methods to utilize 54% Source and methods to utilize

6

Treatment mix inputs
7
Year 1 Year 2 Year 3 Year 4 Year 5
Product “X” 0.0% 0.0% 0.0% 0.0% 0.0%
Comparator A 43.9% 43.9% 43.9% 43.9% 43.9%
Comparator B 3.0% 3.0% 3.0% 3.0% 3.0%
Comparator C 6.1% 6.1% 6.1% 6.1% 6.1%
Comparator D 9.3% 9.3% 9.3% 9.3% 9.3%
Comparator E 7.5% 7.5% 7.5% 7.5% 7.5%
Comparator F 0.8% 0.8% 0.8% 0.8% 0.8%
Comparator G 29.2% 29.2% 29.2% 29.2% 29.2%
Comparator H 0.3% 0.3% 0.3% 0.3% 0.3%
Total 100% 100% 100% 100% 100%

Current Scenario (without EVENITY™)
Year 1 Year 2 Year 3 Year 4 Year 5
Product “X” 0.0% 0.2% 0.2% 0.4% 0.4%
Comparator A 43.9% 43.9% 43.9% 43.9% 43.9%
Comparator B 3.0% 3.0% 3.0% 3.0% 3.0%
Comparator C 6.1% 6.1% 6.1% 6.1% 6.1%
Comparator D 9.3% 9.3% 9.3% 9.3% 9.3%
Comparator E 7.5% 7.5% 7.5% 7.5% 7.5%
Comparator F 0.8% 0.7% 0.7% 0.6% 0.6%
Comparator G 29.2% 29.2% 29.1% 29.1% 29.1%
Comparator H 0.3% 0.2% 0.2% 0.2% 0.2%
Total 100% 100% 100% 100% 100%

Current Scenario (with EVENITY™)

7

Cost Inputs: Drug Acquisition and Administration
8
Drug Brand/Generic Dose Frequency Strength Doses per Administration / Year WAC Annual Cost
Product “X” Brand Monthly 210 mg 2 / 12 $22,173
Comparator A Brand Weekly 70 mg 1 / 52 $98
Comparator B Brand Daily 5 mg 1 / 365 $2,586
Comparator C Brand Monthly 150 mg 1 / 12 $340
Comparator D Generic Annually 5 mg 1 / 1 $300
Comparator E Generic Daily 60 mg 1 / 365 $1,341
Comparator F Generic Daily 20 mcg 1 / 365 $40,086
Comparator G Generic Biannually 60 mg 1 / 2 $2,438
Comparator H Generic Daily 80 mg 1 / 365 $22,173

Drug Acquisition Costs
Administration and Services Fees
Commercial Medicare Advantage
Subcutaneous Injection $21.72 $16.94
One IV Infusion $93.33 $72.80

Provide sources and methods

8

Patient population – Commercial Perspective shown
9
Provide sources and methods
Provide sources and methods

9

Results: per member per month for commercial
10
Over 5 years, the budget impact of Product “X” is estimated to be -$0.001 PMPM in a hypothetical 1M commercial member plan

10
PMPM

Year 1 Year 2 Year 3 Year 4 Year 5 Net (Years 1 – 5) 0 -1E-3 -1E-3 -2E-3 -2E-3 -1E-3

Results: cumulative budget impact for commercial
11
Under the new scenario, cumulative costs are reduced by an estimated $75,566 over 5 years across 1M commercial members
Projected Total Costs Between Scenarios Over 5 Years
Net Difference
-$75,566

11

Current Scenario New Scenario 6925739 6850172

Assumptions and Limitations
12
The model assumes all patients complete the entire treatment duration
The model assumes the eligible population identified reflects the size of the population that may be eligible for Product “X”
The treatments included are assumed to reflect the treatments utilized among the eligible population
Treatment costs are assumed to be similar to the wholesale acquisition cost (WAC)
Assumptions
The model is focused on drug acquisition and drug administration costs only and does not consider differences in efficacy that may impact initial treatment
The model excludes the cost of other treatment-related resources including therapeutic drug monitoring, hospital costs, laboratory and diagnostic tests and any procedures or additional medications
Limitations

12

Conclusions
13

-$1,033,609
Budget Impact
Total Cumulative
-$0.017
decrease
Per Member Per Month
1M: One Million
The entry of Product “X” for Disease “Y” introduces the question of affordability for health plans.

The budget impact model demonstrates cost savings in a hypothetical 1M member health plan in both the Commercial and Medicare Advantage settings

The results should be interpreted within the context of the data inputs and modeling assumptions used as the results may be sensitive to changes in these inputs

-$75,566
Budget Impact
Total Cumulative
-$0.001
decrease
Per Member Per Month
Commercial
Medicare Advantage

13

You are an employee at Novartis. The company is currently addressing potential exclusions from formulary due to the introductions of generic versions as well as the introduction of other branded competitors. The company would like to develop a budget impact analysis and understand the budget impact in the treatment of Newly diagnosed adult with Philadelphia chromosome positive chronic myeloid leukemia (Ph+ CML) in chronic phase for both the Commercial and Medicare populations. You are tasked with developing this analysis as an economic model and providing your senior management with the budget impact and per member per month (PMPM) impact for both payer types.

Additional key question to answer: What is the discount needed to stay cost neutral with generic versions as well other branded products that fall within the same therapeutic class (tyrosine kinase inhibitors) of the market uptake that must occur such that the budget impact to payers exceeds $0.05 PMPM at 3 years?

DMS：Dasatinib
Dosing: One pill, once daily, either in the morning or in the evening
Dosing is the same for both newly diagnosed and imatinib-resistant or -intolerant CP Ph+ CML patients. For patients taking Dasatinib 100 mg daily, a dose decrease to 20 mg should be considered.
Novartis: : Tasigna® (nilotinib)
Dosing：300 mg
TASIGNA® (nilotinib) capsules doses should be taken approximately 12 hours apart. Adult patients should take 2 capsules in the morning and 2 capsules in the evening Capsules should be swallowed whole with water Patients must avoid food for 2 hours before and 1 hour after each dose For patients who cannot swallow TASIGNA capsules whole, the contents of each capsule may be sprinkled in 1 teaspoon of applesauce (puréed apple). The mixture should be swallowed right away (within 15 minutes) and should not be stored for future use
indicated population

Comparators–Dasatinib

Model feature Description Notes
Perspective and audience payers Novartis
Population Commercial and Medicare
Indication The worldwide annual incidence of CML is approximately 1–1.5 in 100,000 persons.In United State, 8990 people were diagnosed with CML in 2019.
Time horizon 5 years
Cost $16470/50mg The cost for Tasigna oral capsule 50 mg is around $16,470 for a supply of 120 capsules, depending on the pharmacy you visit

Drug brand/generic Dose frequency strength Doses per administration/year Average Wholesale Price (AWP)

Nilotinib(Tasigna) brand Daily 400mg 2/365 $196,473
Dasatinib(Sprycel) brand Daily 100mg 1/365 $185,932
Imatinib(Gleevec) brand Daily 400mg 2/365 $145,764
Bosutinib(Bosulif) brand Daily 500mg 1/365 $204,706
Ponatinib(Iclusig) brand Daily 45mg 1/365 $238,478

Comparators

Feature Product of Novartis Product of DMS
Benefit design Medical Medical
Patient cost-sharing Co-insurance(initial coverage phase:25% to 33%-coverage gap phase: 45%-50% coinsurance) Co-pay (driven from 4171 to 16684)

Mode of administration Orally twice daily Oral once daily
Duration of treatment Chronic(18.4 months) Chronic(15 months)
Site of care Hospital outpatient Hospital outpatient
Lab testing No monitoring No monitoring
Side effect an allergic reaction: hives; difficult breathing; swelling of your face, lips, tongue, or throat. Diarrhea, nausea/vomiting,headache, muscle pain, pain in your hands or feet

Population

Treatment Mix

Commercial Drug Costs

Medicare Drug Costs

Commercial Budget Impact

Drug Costs(Commercial)

Medicare Budget Impact

Drug Costs(Medicare)