To appropriately assess the value of medicines in the U.S., methods must reflect the country’s decentralized and dynamic healthcare system. Research by Johnson & Johnson, in collaboration with The Swedish Institute for Health Economics, explored how generalized cost-effectiveness analysis (GCEA) can better reflect the complexities of the U.S. pharmaceutical market compared to conventional cost-effectiveness analysis (CEA), which is used in some other countries to assess the value of new medicines and inform coverage decisions.
The study, “Tailoring Generalized Cost-Effectiveness Analysis (GCEA) to the U.S. Setting: The Importance of Using the Right Prices,” reviewed existing methodological literature and empirical studies and found that the GCEA framework incorporates key factors that should be considered in assessing the value of one treatment versus another that conventional CEA does not.
However, further methodological development, empirical research and explicit guidance regarding modeling prices is warranted to more fully reflect the market-oriented nature of the U.S. pharmaceutical market. Specific areas include modeling price changes as a function of competition in the period before loss of exclusivity and clarification of what price metric to use for different stakeholder decisions. For both areas, operationalizing these features in practice will require consideration of data availability and how the market may change over time.
This research was funded by Johnson & Johnson and conducted in collaboration with The Swedish Institute for Health Economics. For full details on the study design, methodology and limitations, see: Willis M, Nilsson A, Neslusan C. “Tailoring Generalized Cost-Effectiveness Analysis (GCEA) to the U.S. Setting: The Importance of Using the Right Prices.” Poster presented at The International Society for Pharmacoeconomics and Outcomes Research (ISPOR) 2025 Conference, Montreal, Quebec, Canada, May 13–16, 2025.
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