Health economics and outcomes research: a pharma function evolves

While it is hardly a new line of work, HEOR (health economics and outcomes research) is experiencing a period of rapid growth, driven by the increased need to provide payers with meaningful data on drugs’ effects on patients. So says Rachel McAvoy, research director at ISR Reports, in a recently published study. “Pharma needs to sell the story of a strong value proposition for its products and HEOR is the way to do it.,” she summarizes.

The ISR study, Benchmarking the pharma industry’s HEOR functions, surveyed about 20 top 50 pharma companies, collecting commentary on best practices, costs and staffing needs. At a few top 10 pharma companies there are now over 100 employees dedicated to HEOR; others had smaller numbers ranging from a handful to essentially none. HEOR is also readily outsourced.

One of the more interesting results of the ISR analysis is how differently pharmacos structure HOR withing corporate organizational charts. While HEOR professionals themselves look at the world mostly from a medical or scientific perspective (seeking to publish results in academic journals, for example), and some companies put HEOR within the R&D department (where it can more easily commission clinical-trial-type studies), more companies place it within the Medical Affairs department or even the Market Access group, which is primarily a commercial function. Some HEOR professionals dislike the commercial focus, and some take extra steps to add rigor to studies or analyses in order to overcome the perceived commercial bias.

HEOR studies can cost around $1.1 million on average, but the range is quite broad, from $100,000 to nearly $6 million among the survey panel.

The study is available from Industry Standard Research, Cary, NC; www.isrreports.com.