Prices/pricing cost-effectiveness evaluation

The pharmaceutical manufacturer may he claiming a pricing premium because of a claimed additional benefit (that is, improved effectiveness, a better adverse-event profile or delivery system) conferred by the new product over its therapeutic rivals. If no such benefit is established, the PBAC process is known as "cost minimization" and involves a recommendation for therapeutically equivalent doses and prices (Birkett, Mitchell, and McManus 2001). Once a decision is made to recommend listing of the drug for government reimbursement, the PBPA then evaluates the requested price against an international benchmark price and the clinical and cost-effectiveness data from the PBAC. 

Attempts could be made to systematically evaluate the social benefits of linking cost-effectiveness analysis not only with reference pricing, but government controls over industry-level profit and promotional expenditure, price-volume agreements, and competitive tendering. 

Surfactant-Hypochlorite Digestion. The surfactant-hypochlorite digestion method is a cost-effective process with a limited effect on PHA degradation. It has been evaluated that US 5.58/kg of P(3HB) is produced for the annual production of 2850 tonnes of purified P(3HB) using the surfactant-hypochlorite digestion method from C. necator. However, it has a lower price compared to the chloroform-hypochlorite system. The cost of P(3HB) declined to US 4.75/kg due to an increase in the production scale to one million tonnes per year. ... 

The cost of feed and fuel is typically the largest component of the overall production cost of hydrogen. Feed and fuel usually account for more than 80% of the total before the steam credit is taken. The overall operating cost changes significantly as the natural gas price varies. Figure 10 shows the effect of varying the natural gas price. For this evaluation, the export steam credit to natural gas price ratio was held constant. 

Finally, while total promotion expenditures over all types of promotional efforts approximately doubled between 1996 and 2001 (Table 9.1), so too did revenues, and thus total promotional intensity remained relatively constant. The total promotion-to-sales dollar ratio has hovered between 14% and 16% between 1996 and 2002, but it appears to have increased tol7.1% in 2003. This most recent increase may reflect the rising relative importance of free samples provided physicians, which in large part (Table 9.1), as noted above, are evaluated at their full retail prices rather than at marginal production costs. The apparent increases might also simply reflect the effects ofvarious measurement errors. 

Selection of appropriate treatment alternatives in a clinical smdy is essential for a useful economic evaluation of a pharmaceutical therapy. This issue is both a clinical and an economic one. Comparators can be the most common alternative therapies for a condition or the lowest possible cost alternatives, even when not frequently used. However, in pharmacoeconomic studies, treatment comparators may be inappropriately selected as much for their relatively high price as for their likely effectiveness. Phase III smdies have special limitations in this regard, because agents will be compared against the... 

The primary results of economic evaluations usually is a comparison of average, or pooled, differences in costs and differences in effects among patients who received the therapies under study. It is an open question, however, whether pooled results are representative of the results that would be observed in the individual centers or countries that participated in the study. In some, the therapy may provide good value for the costs, whereas in others it may provide poor value. Three reasons commonly cited for these differences are differences in practice patterns (i.e., medical service use), differences in absolute and relative prices for medical service use (i.e., unit costs), and differences in underlying morbidity/mortality patterns in different centers and countries. 

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