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Innovations that extend life can generate option value and cost of experiencing future technologies.

To understand how consideration of option value may affect the potential cost-effectiveness of a treatment through a case study of ipilimumab for previously untreated metastatic melanoma.

We estimated the cost-effectiveness of ipilimumab in 2 scenarios: a conventional scenario, for which we constructed the model using the standard methods that rely on efficacy data directly from the phase III trial of ipilimumab, and an option value scenario, where we incorporated future hypothetical improvements in mortality for metastatic melanoma owing to innovations. We developed 2 approaches to incorporate option value. In the first approach, we forecasted mortality trends based on historical trends from the Surveillance, Epidemiology, and End Results (SEER) Program registry. Alternatively, we …