Pricing Treatments Cost-Effectively when They Have Multiple Indications: Not Just a Simple Threshold Analysis.

With treatment prices rising, economic evaluations increasingly employ price-threshold analyses to identify value-based prices. Standard price-threshold analyses can be overly simplistic when treatments have multiple indications.Jurisdiction-specific rules governing indication-specific prices and reimbursement decisions affect value-based price analyses.When the manufacturer is restricted to one price for all indications and the payer must make an all-or-nothing reimbursement decision, the selected price is a weighted average of indication-specific threshold prices such that reimbursement of the more valuable indications subsidize reimbursement of the less valuable indications.With a single price and indication-specific coverage decisions, the manufacturer may select a high price with fewer patients treated than in the first-best solution. There are also cases in which the manufacturer selects a lower price, resulting in reimbursement for more indications and positive consumer surplus.