Risk and Cost

If one is less restrained in setting specification limits, a balance can be struck between customer expectations and the risk and cost of failure a review of available data from production and validation runs will allow confidence limits to be calculated for a variety of scenarios (limits, analytical procedures, associated costs see Fig. 2.15 for an example). 

In conclusion, there are no absolute reasons in nature that would indicate a convenience for every species to embark on the risks and costs of a profound morphophysiological remodeling, at either the root or stem level, and to face the odds of hosting and feeding invasive bacterial populations. In many instances... 

It is clear that patients with febrile neutropenia represent a heterogeneous group. Some patients are at lower risk and potentially could be treated as outpatients, thereby avoiding the risk and cost of hospitalization. The Multinational Association for Supportive Care in Cancer (MASCC) has validated a risk-assessment tool that assigns a risk score to patients presenting with febrile neutropenia7 (Table 96-3). Patients with a risk-index score of 21 or greater are identified as low risk and are candidates for outpatient therapy (discussed under Treatment ). 

Most chemical companies aim at making about a 10% profit on all sales. This means that the pretax profits must be around 20%. Since new products involve a large amount of risk and cost uncertainty, a new process is generally not considered unless at least 30% average profit is expected before paying federal corporate income taxes. From this a reasonable rate of return or interest rate may be obtained if some other information on the plants is available. This is done in the following example. 

The decision to use radioimmunotherapy requires consideration of the complexity, risks, and cost. The ideal candidate has limited bone marrow involvement and adequate blood cell counts. 

Currently, physicians and patients determine the demand for pharmaceuticals and employers and insurers assume the risk and cost. As the price of new health care technologies escalates, payers will design and implement strategies to share risk and cost. Defined employer contributions, increased patient cost sharing, and benefit exclusions will be used to help control utilization and cost. In this environment, value-based assessments will be crucial to the adoption of any technological innovation. It is reasonable to expect public and private coverage for new therapies if evidence is provided regarding the costs and consequences of treatment. However, social and ethical dilemmas will certainly arise as therapies whose costs exceed their benefits are debated in the public arena. 

There are risks and costs to a programme of action, but they are far less than the long-range risks and costs of comfortable inaction. 

Nonetheless, Canada, Japan, the United States, and Russia all have active research and exploration programs in this area. As global oil supplies dwindle, using methane hydrates might increasingly be seen as worth the risk and cost. 

Scalability of the systems is a must and the use of low MOI strategies is obligatory if the goal is the industrial application. Complex feeding strategies must be avoided since they impose high risks, and costs, to the overall process. 

Avorn, Jerry. 2004. Powerful Medicines The Benefits, Risks, and Costs of Prescription Drugs. New York Alfred A. Knopf... 

Avorn J. Powerful medicines the benefits, risks, and costs of prescription drugs. New York Knopf 2004. 

Lower risk and cost (relative to other containment technologies) because the soil is not excavated and there are no by-products. 

Mitre. 1991. Comparative Assessment of Risk and Cost for Munitions Transport for On-Site Disposal in the Chemical Stockpile Disposal Pro-... 

Naturally the most efficient method will be employed to achieve the desired result, and it is the capacity of the company to service the funding mechanism which will determine the cost of this capital. The lower their capacity the higher the risk and cost will be to secure the funding. The risk in the product must therefore have a full compensating value to justify the investment. Although the pharmaceuticals industry is high risk, it becomes possible to find funds in most cases due to the high rewards available for success. 

For non-thresholded contaminants some mechanism is required that will allow the benefits in terms of reduced risks and costs associated with control to be taken into account. The costs of control will include enforcement costs as well as costs to producers in reaching ever stricter standards. Ultimately these costs will be borne by consumers in taxes, increased prices or reduced choice. Economic theory dictates that there must be a point where the extra increase in the cost of control is not justified by the corresponding increase in benefit (reduction in risk). This optimal point will differ for each contaminant according to the technology needed to control it, the nature of the hazard, and the relationship between dose and risk. It is in this latter context that quantitative risk assessment (QRA) becomes critical (see section 2.3.4 of this chapter). 

Infrastructure and distribution raise similar problems. Capable third-party chemical distributors offering consistently high levels of service are not universally available. According to a 2002 study published by the State Council s China Development Research Centre, 70 percent of China s commercial enterprises have their own fleet of vehicles and 80 percent own their warehouse facilities. MNCs thinking about setting up their own (Western-style) nationwide chemical distribution network have soon been discouraged by the high risks and costs involved. 

The statistician s work is crucial both to the justification of the studies proposed for all phases of IND research and to the related study designs. Scientific determination of the necessary size of the initial patient population (phase 2) must depend largely on a statistical estimate of the smallest number that would be sufficient, because the fewer people exposed to the risk of a new drug product, the better. Both risk and cost are reduced. 

The team develops in phases to allow management to monitor what is happening, and to keep a balance between risk and cost (Figure 3-2). In the first phase one does not know which of the many ideas will make it (if any). The risk that an idea will fail is large. That is why the team only spends small amounts of time and money on each idea. As you go to further stages, the product and development project must become more and more defined. The team has to focus, because the cost there increases greatly. If too much uncertainty remains management should stop the project. 

Once an attractive product has been identified, the time factor becomes extremely important, risk and cost are no longer the only relevant criteria. From now on speed and efficiency are of paramount importance. A minor planning error which results in a delay of a task on the critical path for only one month can delay the entire project by one month. Almost inevitably it also adds 1/12 of the annual budget to the development cost. Thus, in a project with an average annual budget of 2.5 million, a delay like this can cost more than 200,000. Apart from these direct cost, later access to the market can cause much higher losses. 

The implications of those safety requirements for urgently needed new adjuvants are significant. The adjuvant issue appears to be caught in a vicious circle. Risky vaccine projects cannot afford the extra risk and cost of an adjuvant development project, which could cost several million dollars. On the other hand, the success of several recombinant vaccines under development seems to depend on new and better adjuvants. The lack of clearly superior adjuvant candidates with reproducible effects aggravates this current situation. 

A similar trade-off between diagnostic accuracy and risk is necessary when imaging the carotid bifurcation in patients with TIA or ischemic stroke. Performing intra-arterial catheter angiography in everyone is clearly unacceptable because of the risks and cost. Fewer than 20% of patients will have an operable carotid stenosis even if only those with cortical rather than lacunar events are selected (Hankey and Warlow 1991 Hankey et al. 1991 Mead et oL 1999). Coirfining angiography to patients with a carotid bifurcation bruit will miss some patients with severe stenosis and still subject too many with mild or moderate stenosis to the risks. Nor will a combination of a cervical bruit with various clinical features do much better (Mead et al. 1999). 

Problem definition and solution will usually be an iterative process. Each solution of the approximate problem can be used to provide estimates of cost and to indicate the critical values of the uncertain parameters. This information allows the project team to trade off risk and cost at a very high level. In working with industrial project teams, we have found them to be quite comfortable with defining problems in this way and with exploring the interactions between problem definition and the cost of the resulting design. 

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