Intended for healthcare professionals


Economics of biological therapies

BMJ 2009; 339 doi: (Published 21 August 2009) Cite this as: BMJ 2009;339:b3276

The main strength of the value-based approach for drug pricing

In examining models for pricing drugs, Kelly and Mir (1) contrast
the “existing profit and price controls” with the new value-based
approach in which drug prices are determined on the basis of cost

The rationale underlying the value-based approach is explained in
detail, and so one understands that the main advantage of this method
stems from its nearly universal applicability. However, one point has not
been stressed enough: the alternative represented by the “existing
profit and price controls” is purely empirical, has no clear underlying
rationale, and is subjected to a wide heterogeneity across different
countries (2,3). So, one important strength of the value-based method
lies in the weakness of the alternatives to it.


1. Kelly CJ, Mir FA. Economics of biological therapies. BMJ

2. Iheanacho I. Slowly, the monster dies. BMJ 2007;335:452.

3. Earl-Slater A. Regulating the price of the uk's drugs: second
thoughts after the government's first report. BMJ 1997;314:365.

Competing interests:
None declared

Competing interests: No competing interests

25 August 2009
Andrea Messori
Laboratory of Pharmacoeconomics
c/o Azienda Ospedaliera Careggi, 50136 Firenze, Italy