After reviewingInstitute for Clinical and Economic Reviewconsider the following: In the UK, very few drugs or procedures are approved if they cost more than $50,000 per QALY. Take the example of PCSK9 inhibitors. The PCSK9 inhibitors (PSK9i) are a class of injectable drugs approved in 2015 that have been shown to dramatically lower LDL cholesterol levels, by up to 60% when combined with a statin. The market price of the first PCSK9s to be sold in the US in 2015 was $14,350 per year. The ICER analysis shows how many more patients could be treated at lower total budget impact if the price could be lowered.

• Given this information what price should Medicare pay for a PSCK9?
• Should a state Medicaid program pay more or less?
• Should Medicaid programs inlow incomestates pay more, less or the same, compared to high income states?It should beadjusted inlow incomestates. (Research)
• Should there be one $/QALY for an entire country?
• How would you expect drug companies to react to price limits set by public programs?

Figure ES1. ICER value graph combining cost-effectiveness and potential budget impact analyses. Colored lines represent the impact on annualized budget impact of different uptake patterns (eligible patients treated) at the actual list price of the drug (dashed line) and at drug prices needed to achieve common incremental cost-effectiveness ratios. Estimated Cost/QALY: $296,850 ($14,350 annual drug price) $36 Cost/QALY $150,000 ($7,735 annual drug $32 price) $28 $24 Cost/QALY $100,000 ($5,404 annual drug $20 price) Annual Budget Impact (Billions) $16 $12 Cost/QALY $50,000 ($3,166 annual drug $8 price) $4 $0 0% 25% 50% 75% 100% % Eligible Patients Treated