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New ARVs Could Represent Over USD 3 Billion in Cost Savings Through 2025
Vineet R. Prabhu; Cebele Wong; Sarah Jenkins; Saman Nizami; Kelly Catlin; Paul Domanico
Clinton Hlth Access Initiative, Boston, MA, USA
Several new antiretrovirals (ARVs) are likely to be introduced in low-and middle-income countries (LMICs) by 2019 that represent a range of clinical and cost advantages to current products. These include tenofovir alafenamide fumarate (TAF), low dose efavirenz (EFV400), and dolutegravir (DTG). As programs evaluate adoption of these products, it is important that they understand the cost savings implications of doing so.
CHAI’s forecast for currently available products was used as baseline. Historical uptake analogs as well as theoretical curves that fit a Gompertz function were used to model competition between new and current products based on anticipated clinical and price differentiation. Competitive sets were as follows: TAF displacing tenofovir disoproxil fumarate (TDF) and zidovudine (AZT) in first-line, EFV400 and DTG displacing EFV600 and nevirapine (NVP) in first-line, and DTG replacing TDF and AZT-based backbones in second-line. Prices over time were estimated based on market intelligence using raw material costs, formulation costs, threshold volumes required for economies of scale, and manufacturer profit margins. Each product’s annual cost savings was calculated by multiplying the price differential between new and current products by the number of patients projected to be on the relevant new product each year.
TAF was projected to aggressively replace TDF and AZT in first-line. By 2025, TAF would represent over 95% of that market and savings of over USD 1.5 billion. For first-line treatment, DTG was projected to aggressively replace EFV600 and NVP, representing 80-90% of that market by 2025, with EFV400 representing most of the remainder. Collectively, DTG and EFV400 may represent total savings of over USD 1 billion through 2025. Lastly, DTG was projected to replace over 90% of TDF and AZT-based backbone use in second-line, with associated cost savings of USD 300 million through 2025.
Current pricing methodologies and plans to advance approach will be shared.
TAF, EFV400, and DTG will enable programs in LMICs to put more patients on treatment due to lower per capita spend. Our findings support concerted efforts by national programs and donors to advocate for accelerated availability and strongly encourage uptake of new ARVs to realize their savings potential. Clear commitments for rapid adoption of these products would encourage more manufacturers to produce larger “at-scale” volumes at competitive prices, and help increase patients on care.