The Case For Including Dynamic Drug Pricing In Cost-Effectiveness Analyses Under The IRA

Date: October 18, 2023
Journal: Health Affairs Forefront
Citation: Whittington MD, Neumann PJ, Cohen JT, and Campbell JD. (2023) "The Case For Including Dynamic Drug Pricing In Cost-Effectiveness Analyses Under The IRA", Health Affairs Forefront, October 18, 2023. DOI: 10.1377/forefront.20231016.197078

This commentary argues that practitioners of cost-effectiveness analyses should incorporate dynamic drug pricing into formal cost-effectiveness analyses (CEAs). For reasons we discuss, doing so will more accurately reflect drug costs over time. The advent of the Inflation Reduction Act (IRA) makes the inclusion of dynamic drug pricing in CEAs even more important, as the law includes manufacturer rebates that are tied to inflation and Medicare price negotiations that will alter the price of certain drugs prior to and after their loss of exclusivity.

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