Formulary addition of Brand X for hypertension treatment
A budget impact model was developed to estimate the financial impact of adding Brand X, a new angiotensin converting enzyme (ACE) inhibitor, to the formulary of a 500,000 member US regional health plan.
Methodology
Published epidemiological and medical cost data were combined with randomized controlled trial efficacy data and real-world adherence rates for Brand X versus generic competitors to model changes in healthcare costs before and after Brand X placement on the health plan formulary.
Model inputs were based on well-validated sources including census statistics, NHANES hypertension prevalence, claims analysis of plan hospitalizations costs, and multinational longitudinal studies of antihypertensive medication adherence and persistence. Conservative utilization and market uptake assumptions for Brand X were used.
Results
Model projections show formulary addition of Brand X and providing first-line coverage status for essential hypertension results in a medical cost savings of $12-$15 per member per month (PMPM).
This positive net financial impact is driven by reductions in preventable hypertension complications like stroke, myocardial infarction, and heart failure which lower projected inpatient hospitalization expenses.
Through best-in-class medication adherence rates and efficacy in difficult-to-control hypertension, Brand X demonstrates valuable economic value stemming from avoidance of major cardiovascular events requiring hospitalization and rehospitalization.
Conclusions
Based on demonstrated clinical benefits translating to fewer hypertension-related hospitalizations and lower total medical costs, this budget impact analysis supports formulary inclusion of Brand X as a cost-saving intervention for the health plan and its beneficiaries.