2023 Top HEOR Trends: HEOR as a Differentiator vs. Commodity

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Avalere experts dive into Trend #8: HEOR as a Differentiator vs. a Commodity and explore the need for tailored evidence generation planning.

In this series, Avalere is identifying the top trends in health economics and outcomes research (HEOR) that are shaping the landscape in 2023 and beyond. In this Insight, Avalere experts dive into Trend #8: HEOR as a Differentiator Versus a Commodity.

The Need for Tailored HEOR Evidence Generation Planning

Life sciences organizations of all stages and sizes have HEOR and real-world evidence (RWE) generation needs, but the emphasis and approach that organizations place on this planning and evidence generation varies due to a number of factors. Some HEOR teams sit in the Commercial vertical of their organization, while others are situated in Medical. Some teams cater their evidence generation strategies to the needs of payers, while others consider patients/patient advocacy groups interests, provider perspectives, and market and policy dynamics, such as the impacts of the Inflation Reduction Act (IRA).

There is a broad spectrum of approaches across the industry, but strategic evidence generation planning for pipeline assets is crucial to the execution of a strong HEOR evidence generation plan that supports coverage, reimbursement, and provider uptake upon launch. With a tailored approach, life sciences organizations can also integrate other evidence needs into their plan based on factors such as risk of third-party value assessment at launch, risk of Medicare drug price negotiation via the IRA, and the need to demonstrate patient-centric value of a product to enable shared-decision making. Within this dynamic HEOR landscape, it is essential for life sciences organizations to be confident, competent, and creative in advanced evidence planning and execution.

What Makes an Evidence Generation Plan Tailored and Uniquely Relevant?

Ideally, organizational readiness for HEOR planning would be a key priority from early Phase 2 onwards. However, the economic climate, funding constraints for early-stage biotech firms, and overall organizational budget pressures have resulted in impacts to manufacturers’ HEOR and RWE readiness. Some manufacturers may begin late Phase 3 without a true HEOR evidence generation plan in place. In these instances, companies may have limited HEOR resources that are allocated for developing a value story for their product and may not have a full understanding of the resources required to create and maintain a differentiated product in an ever-changing market.

If a manufacturer decides on a pared down evidence generation strategy that addresses the needs of only payers, they may have a challenging time with other stakeholders, such as value assessors and providers looking to prescribe novel therapies, or when positioning their value evidence with the Centers for Medicare and Medicaid Services during Medicare drug price negotiation. Full evidence generation planning and execution takes time, financial resources, multi-disciplinary expertise, and a convicting value story. The short-term needs of a product may not lead to long-term strategy for evidence generation and differentiating outcomes that meaningfully distinguish the product from its competitors.

Early Investment and Planning Can Drive Success Throughout the Product Life Cycle

Upfront investment in evidence generation planning can yield long-term product success late in the life cycle, but manufacturers should recognize that their HEOR evidence generation plans are living documents that must be updated frequently to adapt to the market, policy environment, and other environmental factors. A research-driven approach can be used to propel HEOR evidence generation planning. Utilizing primary stakeholder research paired with secondary landscape assessments of the literature can help build a foundation for multi-year evidence generation planning that is responsive to stakeholders and recognizes the status quo, while allowing manufacturers to best position their product based on its value proposition and anticipate market and policy pressures, such as value assessment and the IRA.

Look for future Avalere Insights and webinars on top trends in HEOR, including policy’s pressure on HEOR and novel elements of value, and view the related webinar on HEOR as a differentiator. To discuss how Avalere can support your HEOR initiatives or to receive regular Avalere updates, connect with us.


Webinar | A Closer Look at Patient Support On June 6 at 2 PM ET, Avalere experts will explore how potential implications of the Inflation Reduction Act (IRA)’s out-of-pocket cap, in addition to other key regulatory and policy activities shaping benefit design and patient cost-share (e.g., EHB), could impact patient commercial and foundation assistance. Learn More
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