Amgen and Avalere Partner on Outcomes-Based Contracting for Rheumatoid Arthritis Treatment

Avalere Health, a subsidiary of Inovalon, recently entered a partnership with Amgen on value-based contracting. Under the agreement, the company will deploy its data and analytic capabilities with outcomes-based contracts (OBCs) to help further support the development of OBCs based on the value of Amgen’s products.

In an exclusive interview with Specialty Pharmacy Times, Dan Mendelson, president of Avalere Health, discusses the new agreement and the role it will play in improving patient care.

SPT: Discuss the new agreement Inovalon and Avalere has entered with Amgen?

Mendelson: We are working with Amgen to apply our data assets and our proprietary algorithms to focus on contracting strategies around rheumatoid arthritis (RA). The context is that they have made a decision, which I think is wise, that value-based contracting is what payers want and that they need to deploy resources to accommodate increased efforts in that area. We have unique resources in that space owing to the quality of the data that we have, as well as the long history of creating proprietary algorithms. We also have great relationships with a lot of health plans; we have over 120 customers.

SPT: Why is this partnership so important?

Mendelson: I think it’s important for them because we have the ability to create a scalable platform for them that will enable them to contract on a consistent basis with health plans across this country. I think that’s really the strategic importance of this relationship.

SPT: What steps need to be taken to implement a value-based model?

Mendelson: I think the beauty of it for Amgen is that once we have used the data to derive the algorithms, all they need is a partner that is interested in contracting on that basis. We take care of all the data requirements and always structure our value-based agreements in such a way that they can be implemented right away.

SPT: What impact will this have on patients, particularly those with rheumatoid arthritis?

Mendelson: A value-based contract is intended to improve patient care, and they work best when the measures of value are aligned with patient care and where the use of that contract serves to improve the patient’s experience. And that’s always our goal.

SPT: What role has data played in valued-based care?

Mendelson: The data part is critical. What we do is go in and look on a comprehensive basis of how the care of rheumatoid arthritis works in the real world, both for Amgen products as well as other products in the space. The algorithms that we produce are based on over 150 million patients nationwide, so the data certainly serves as a core facet of the creation of the algorithms. Data is necessary in order to adjudicate a relationship on a going forward basis. The plan generates the patient data, we receive that patient data, and then adjudicate on behalf of the plan and the pharmaceutical company.

SPT: What are the differences in shifting from fee-for-service to valued-based care, especially for patients with RA?

Mendelson: Many patients with rheumatoid arthritis are living in the world of Medicare Advantage, which is a value-based environment. Think about the fact that you have about 30% of the Medicare population in Medicare Advantage, and then you have many more who are being cared for in a more integrated delivery system. I think in a lot of respects, kind of, the value-based concepts are here today, and this is a matter of creating more sophisticated contracting strategies in RA that would be organized to serve the patient experience.