Impact of Denmark’s Recent Shift to Health Economic (HE) Evaluations and Its Evolution

In recent years, Denmark has shifted from its “added medical value” framework for evaluating new medicines and indication expansions in heath technology assessments (HTA) in favor of a quality-adjusted life year (QALY) approach, similar to that of NICE’s approach in the UK.

This decision was made after a 2019 evaluation of the Danish Medicines Council's (DMC) own processes found that the "added medical value" approach was effective for negotiating net prices but was associated with limited transparency. Unlike France and Germany, the DMC’s “added medical value” approach was based on qualitative assessments that were obscure in nature given that these assessments were not analytically linked to the price of the medicine.

Impact of Denmark’s Recent Shift to Health Economic (HE) Evaluations and Its Evolution.
Article written by Adrian Jung, Senior Analyst, Windrose Consulting Group

Shift Towards HE Evaluations

In November 2020, the DMC published its new HTA processes, moving to a QALY-based evaluation system. This approach better enables consistent comparisons in the effect of new medicines across different diseases. The purpose of these changes was to increase transparency and facilitate quicker access (by reducing the workload to the DMC). The DMC worked with National Institute for Health and Care Excellence (NICE) International [a] to incorporate the QALY approach within their evaluations through knowledge transfer seminars and DMC observing NICE committees at work. [2] Leveraging these insights from NICE, the DMC launched a conditional approval pathway for medicines (not exclusive to oncology therapies) that have a likely potential to be cost-effective but there is too much uncertainty about the efficacy safety and/or costs. The eligibility criteria for this scheme largely mirrors the entry criteria for UK’s Innovative Medicines Fund (IMF). [3,b]

New HTA Processes for New Medicines and Indication Expansions

The new DMC HTA evaluations are primarily based on a health economic (HE) analysis (detailed in the table below) that results in an incremental cost-effectiveness ratio (ICER).[4,5]

A BI analysis is also required but is primarily used as a supportive assessment.

New HTA Processes for New Medicines and Indication Expansions

While the QALY approach does provide improved transparency through a consistent, systematic framework, Denmark does not publish an ICER (or a budget impact (BI)) threshold. However, a study that analysed recent DMC recommendations (as of March 2023) estimated the WTP (willingness-to-pay) threshold to fall between 458,134 – 969,518 DKK/QALY.[7] This estimation did not consider differences in disease areas, and Denmark may align with other Nordic markets, setting unofficial WTP thresholds based on disease severity. However, more data / HTA decisions are required to form more concrete conclusions.

Windrose’s Take

The shift to HE evaluations as the primary basis for reimbursement recommendations has evident knock-on implications for manufacturers seeking reimbursement in Denmark, who are now able to leverage HTA dossiers from other markets.

Manufacturers may be able to leverage the synergies in the evaluation process with other markets to streamline dossier and evidence development. The current Danish HTA framework is based on NICE’s processes, (1) conducting similar HE assessments and (2) including a conditional access pathway that mirrors the UK’s IMF. Denmark also now better aligns with other Nordic markets that base recommendations on ICERs / HE analyses (i.e., Norway and Sweden). This allows manufacturers to utilize fewer resources when developing Denmark-specific strategies by adapting strategies employed in the UK, Norway and Sweden to the Danish clinical context.

However, due to the lack of an official ICER threshold, full transparency in HTA decision-making is still lacking which remains a key challenge for manufacturers. To overcome this, manufacturers can explore analogues in other HE-based markets, specifically Norway and Sweden where unofficial WTP thresholds are set based on the severity of the disease. Still, it will be important to translate the insights from any analogue assessments to the Danish clinical context by considering Denmark-specific data.

HTAs in Denmark will require continued monitoring as more data from the DMC will be required to better establish the link between the output of HE analyses and their resultant recommendations. Also, it is unclear how HTA in Denmark could continue to evolve as they implement the EU Joint Clinical Assessment (JCA) within the coming years, which currently (as with the rest of EU markets) remains uncertain. While the JCA will not directly affect HTA processes, it will allow for a more uniform approach to handling clinical data (which are used as key inputs within HE analyses) across EU markets, including Norway and Sweden.