Actual acquisition cost

As previously mentioned, the actual acquisition cost of a drug or service should not be used in isolation to determine the value of a drug. Value should be assessed in an analysis that takes into account all consequences (both positive and negative) that result from use of the therapy. For example, if a therapy eliminates the need for surgery, the cost of the surgery would be eliminated from the overall treatment pathway. However, if the same therapy results in an adverse event that requires specific laboratory monitoring, the cost of the laboratory tests would be added into the treatment pathway. The accurate identification and valuation of resource items that result from the use of that therapy are extremely important components of economic analysis. 

Actual acquisition cost (AAC) Average manufacturer price (AMP)... 

Office of the Inspector General (OIG). 2001. Medicaid pharmacy Actual acquisition cost of brand name prescription drug products. Report A-06-00-00023. Washington, DC OIG, August, 2001. 

The MHW sets prices for reimbursable drugs (those approved for the Social Insurance System). Physicians, clinics, and private hospitals are reimbursed at a price slightly higher than their actual acquisition cost. The government has scheduled annual reductions in the reimbursement prices to reduce this source of additional income to physicians. Patients make copayments of 20%, although for children and low-income elderly the copayment is waived, and recently a plan to eliminate copayments for persons 70 years of age and older was introduced. 

To establish EAC, most third parties use a standardized drug cost estimate that often is based on average wholesaler price (AWP) or wholesaler acquisition cost (WAC). Theoretically, AWP is the price that the wholesaler charges to pharmacies, but in reality, AWP is the list price rather than the actual price. Just as the sticker price for a car is an overestimate of the price someone actually pays for the car, AWP is an overestimate of the price pharmacies pay for the drug product. A government study found that pharmacies purchase brand-name drug products from the wholesalers at an average rate of AWP less 21.84 percent (OIG, 2001)... 

Once the right product is selected, it is important to acquire it at the right price. Purchasing pharmacy products (especially prescription drugs) is not unlike purchasing a car in that the fist or sticker price is often different from the final price that pharmacies actually pay. For pharmacy products, the fist price and the terms of sale have an impact on the overall acquisition cost. Terms of sale pertain to discounts and dating (Huffman, 1996 West, 2003). 

If any special machinery is to be transferred with the product then a specialist must check the age, state of repair and mobility of this equipment and that the final delivery facility has the capacity to contain it. During one acquisition, the head of manufacturing was only just in time in noticing that the incoming machines were actually half a metre taller than the headroom in the facility where they were due to be delivered and as a result the manufacturing had to be re-sited, and this brought unbudgeted costs. 

Spectral simulation tools provide a similar opportunity for MR researchers. In its simplest form, spectral simulation allows changes in a data acquisition to be observed without having to program an MR pulse sequence and scan a volunteer on an actual MR scanner. This is particularly convenient in a clinical research setting where scanner time costs are high and access can be scarce. However, simulation methods additionally provide researchers with the ability to run "experiments" on instruments that are not available at their institution. Variations in the "samples" can also be part of a simulation and the effects of their variability on the MR results calculated. Properly characterized, a spectral simulation can incorporate the effects of any physical equipment or environment on a given sample.20 21... 

The difference between in-house and on-line versions of spectral libraries consists mainly in the fee, which depends upon the conditions of use. Usually, in-house versions have to be paid only once upon license acquisition and hardware purchase. Afterwards, the actual use is free of charge, regardless of its frequency. In certain cases an aimual Hcense fee has to be paid. Follow-up costs may occur if updates are demanded or if hardware service is needed. In the case of in-house systems running on UNIX workstations both initial costs as well as upkeep may be considerable. In contrast, the costs for on-line systems solely depend upon frequency of use. Both the reliability and speed of the internet connection may remarkably influence the cost If only used occasionally the on-line version is certainly financially more viable than the in-house version. At best one is able to find free-of-charge internet offers, sometimes with restricted access to certain features (cf Tab. 22.2). 

Dynamic loading problems in the offshore environment depend on either estimated or measured values of shear modulus. In practice, in situ determination of shear wave velocity on land has been used as the best approximation to the actual values for laboratory tests on samples (Richart, 1975). The techniques for using these seismic methods and data acquisition techniques to determine shear wave velocity for land-based applications have been well developed. The problem in the marine environment has been to develop methods to determine in situ shear wave velocity measurements both at the seabed surface and at known depths in the sediment column, which can be determined in a cost-effective manner. 

Overproduction is the excess production or acquisition of items beyond what is actually needed. When overproduction occurs, additional capital investment is necessary, and costs are increased without adding value since more storage space and material handling are necessary. Overproduction that results in excessive material handling adds to risks. 

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