The pharmaco-economics of combination therapies : a study of the effects of component and market factors on combined therapy price

For a growing number of indications, combination therapies are becoming increasingly common due in part to their superior efficacy, as compared to monotherapies. In fact, in the case of infectious diseases such as AIDS and tuberculosis, combination therapies are now the standard of care. With the emergence of drug-device combinations, genetic testing, and individualized medicine, this trend towards combination therapies is likely to continue to grow. In this context the pricing of combination therapies is a critical component that needs to be understood by medical practitioners, payors and policy makers. There are three factors to consider in the pricing of combination therapies: the characteristics and structure of the market in which the combined product is sold, the absence or presence of market exclusivity, and the prices of the components of the combined product, when sold individually. When one or more of the components of the combined product has market exclusivity, additional factors such as exclusionary bundling, tying, and double marginalization may come into play.