Drugs cost-effectiveness analysis

The cost-effectiveness analysis of antiviral therapy has to be seen under the precondition that no long-term effects, such as drug resistance, occnr. Future analysis might show that we strongly underestimated the long-term costs of HIV/AIDS. 

In Chapter 4 Aidan Hollis examines three proposals in considerable detail. The first is an Advanced Purchase Commitment by sponsors, who offer an explicit subsidy in advance for innovative products. The subsidy offer includes a fixed-dollar amount per unit as well as a commitment to purchase a specific number of units at that price. The second proposal is that sponsors pay annual rewards based on the therapeutic effectiveness of innovative drugs. The third approach is to offer a patent extension on patented products to pharmaceutical companies if they successfully developed a vaccine for a disease such as HIV/AIDS that is highly prevalent, particularly in some low-income countries. Hollis concludes that the third approach is an extremely inefficient way to reward innovation. By contrast, the second approach could correct the market failure directly by rewarding innovative drugs according to their therapeutic effectiveness, which is measurable by cost-effectiveness analysis, a topic discussed later in greater detail in Chapters 10 and 11. 

Measures of Costs and Benefits for Drugs in Cost-Effectiveness Analysis... 

IV. The Usual Practice in Cost-Effectiveness Analysis of Drugs from a Societal Perspective... 

The most common practice in cost-effectiveness analysis involving a drug is to use average wholesale price (AWP) as the measure of cost from a societal perspective. Here is a classic example. The well-regarded Gold et al. (1996) book on methods for cost-effectiveness analysis presents some worked examples of analysis done from a societal perspective. One is the study by Stinnett et al. (1996) on the cost effectiveness of dietary and pharmacologic therapy for cholesterol reduction. The authors stated that they use a societal perspective. 

Traditional cost-effectiveness analysis of general interventions, assuming there exists the incremental cost ofvarious inputs, assumes perfectly elastic long-run supply curves. That is, the product can be acquired at the same price, regardless of the quality of the product purchased. While this may be a reasonable approximation for such services as hospital care, perhaps physician services, and some non-research-intensive materials and devices, this is not a proper assumption for patent-protected drugs. 

Measures of cost used in existing cost-effectiveness analysis of drugs done from a societal perspective are wrong. But we do not know how to reconcile theoretically correct analysis with proper and practical pricing and payment policies. 

Grabowski, Henry, and C. Daniel Mullins. 1997. Pharmacy Benefit Management Cost-Effectiveness Analysis and Drug Formulary Decisions. Social Science and Medicine 45(4) 535-544. 

Van Lent-Evers, N.A., Mathot, R.A., Geus, W.P., van Hour, B.A., and Vinks, A.A. (1999) Impact of goal-oriented and model-based clinical pharmacokinetic dosing of aminoglycosides on clinical outcome a cost-effectiveness analysis. Ther Drug Monit 21 63-73. 

Zhang L, HayJW. Cost-effectiveness analysis of rizatriptan and sumatriptan versus Cafergot in the acute treatment of migraine. CNS Drugs. 2005 19 635-642. 

Cost-effectiveness analysis is concerned with how to attain a given objective at minimum financial cost, e.g. prevention of postsurgical venous thromboembolism by heparins, warfarin, aspirin, external pneumatic compression. Analysis includes cost of materials, adverse effects, any tests, nursing and doctor time, duration of stay in hospital (which may greatly exceed the cost of the drug). 

El-Serag HP, Graham DY, Richardson P, et al. Prevention of complicated ulcer disease among chronic users of nonsteroidal antiinflammatory drugs The use of a nomogram in cost-effectiveness analysis. Arch Intern Med 2002 162 2105-2110. 

Eerrgz MB, O Brien B. A cost effectiveness analysis of urate lowering drugs in nontophaceous recurrent gouty arthritis. J Rheumatol 1995 22 908-914. 

The use of MEMS technology in the health care arena leads to the developments of indispensable sophisticated intelligent devices. The miniaturization of these analytical devices is critical since it wiU enable the analysis of large number of drugs per sample and may be used directly with small biopsy s samples or small volumes of body fluids. This in turn leads to fast response time, sensitive and cost-effective analysis. 

H.G. Grabowski and C.D. Mullins, Pharmacy benefit management, cost-effectiveness analysis and drug formulary decisions, Social Science Medicine 45 (1997), 535-544. 

Does it work Kirby and Peel introduce us to the concept of therapy economics the comparative analysis of alternative courses of therapy, which is taken to include treatment and drug regimes, in terms of their costs and consequences. The complex calculations include cost-benefit analysis cost-effectiveness analysis cost-minimization analysis the cost of illness, e.g. the annual cost of cardiovascular disease in the UK and quality-of-life measurements, the impact of alternative treatments on patient well-being and expectations. 

With these findings we can conclude that the drug costs strongly increased since the introduction of HAART. However, other provider costs strongly declined with the introduction of this drug regime, so that the total costs remained stable or declined. HAART is - at least in the short-term analysis given in this literature review - cost-effective. 

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