Objectives: To assess price reductions of anticancer drugs in South Korea over 12 years and analyze the association between price reduction, drug characteristics, and repricing mechanisms.
Methods: We constructed a dataset based on the Health Insurance Review and Assessment Service (HIRA) price log of anticancer drugs from January 2007 to June 2019. We investigated each mechanism that resulted in a price reduction, including actual transaction price (ATP), voluntary reduction by a manufacturer, price-volume agreement, expansion of indication or reimbursement scope, price cut at generic entry, lump price cut in April 2012, and re-evaluation. The price reduction rate per year was estimated by dividing the total number of price reduction events by the total period for which the products were on the market. A Poisson regression model was used to estimate the characteristics-adjusted incidence rate ratio of the price reduction. Price reduction per event was also determined across originator and generic products. Data analysis was performed using R (version 3.5.1).
Results: Five hundred price reductions occurred in 439 new anticancer drugs, with a reduction rate per 100 product-years of 23. ATP was the most frequent cause (39.2%) but had minimal impact (average reduction per event of 3%), followed by lump price cut (19.2%) and voluntary reduction (10.2%). Generic entries and lump price cut had the greatest impact (16-29% reduction per event). ATP was the most frequently occurring mechanism, followed by generic entry, voluntary reduction, and the lump price-cut in April 2012.
Conclusions: The incidence of price reduction of anticancer drugs increased gradually due to various repricing mechanisms. Although these mechanisms are effective, improvements can be made. Well-designed mechanisms that actively regulate price adjustment are needed to establish repricing policies that adequately reflect changes in the value of drugs over their entire life cycle.