THE PILLARS OF COST-EFFECTIVENESS
A PRACTICAL GUIDELINE FOR NEW
TECHNOLOGY COST-EFFECTIVE DECISION-MAKING
Mario-Ricardo Calderón, Alejandro Salvatierra & Roel Roording
Novartis Pharma AG, Central America & Caribbean
Presented at ISPOR 20th
Annual International Meeting, 16 – 20 May, 2015, Philadelphia, USA.
The critical importance and use of health technology assessment in health care decisions towards improved health is practically nonexistent in many Central
American and Caribbean countries. A culture with a health economics mindset that enhances access to new technologies is needed; one that increases the
knowledge and application of economic evaluation among health stakeholders to make cost-effective decisions that improve health.
Health care progress depends on the effective use of resources including knowledge of what drugs or interventions work, how much they cost and how they are
administered or implemented. Patients, providers, policy makers and payers share universal goals in terms of drugs and technology use and acquisition --best
quality, lowest cost and reasonable access. This has resulted in (1) greater focus on healthcare spending, cost-containment, prescribing behavior control and smaller
perceived drug differentiation within the healthcare industry, and (2) increased need for differentiated products, compelling value propositions and better support and
patient access strategies in the pharmaceutical industry.
The rising costs of healthcare and limited resources have spurred the need for evaluating the economic viability of any drug or intervention. However, evaluation of
health technologies and economic evaluations represent only one of the components of a comprehensive strategy to make technologies more accessible to patients.
patients, healthcare providers, governments and society as a whole.
industries to make new technologies more cost-effective and available to
patients in resource-limited settings.
METHODS AND DISCUSSION
A needs assessment was conducted among key internal (pharmaceutical
and the Caribbean to gain insight about their behaviors, patterns and practices
regarding new technology acquisition. Health stakeholders were interviewed at
Panama and the Dominican Republic during 2014. A literature review of lessons
learned and best practices around the world complemented information collected
from local stakeholders.
No standardized way to make budget allocations or procurement decisions was
based on empiric estimates, previous year consumption, earmarked budgets,
drugs is critically important but, due to limited budgets and lack of cost-effectiveness
evidence or knowhow, the key driver behind most decisions is price, the lowest price
possible. Stakeholders acknowledge that inexpensive drugs may turn out expensive
at the end in terms of increased tangible (direct and indirect) and intangible costs and
poor health outcomes.
A simple, useable, read-do Checklist could guide stakeholders to select
cost-effective health technologies, particularly new, innovative high cost drugs. The
Checklist concept has been used effectively for over 75 years by the aeronautical
Boeing Corporation, October 1935). The World Health Organization translated this
concept intuitively to the operating room to reduce the number of surgical deaths
around the world in conjunction with the Harvard School of Public Health (WHO
Surgical Safety Checklist, 2008). A basic organization tool –the simple
Checklist—when properly conceived has proven effective in a wide range of
cases, protect personnel and respond appropriately (U.S. Centers for Disease
save lives and cope with extreme weather conditions and disasters (American Red
In pharmacoeconomics, as in aviation, medicine and public health, checklists can
help ensure consistency and completeness in carrying out complex tasks. Hence, a
practical Checklist with all knowledge domains needed to select new drugs and
technologies could improve the decision makers´ communication and consistency of
information and data, facilitate the decision-making process and determine the most
cost-effective options for the health system.
cost drugs and technologies more cost-effective.
technology selection and acquisition.
policy-makers and payers to (1) get the best drug and technology quality at the lowest cost with reasonable access, and (2) enhance healthcare partnerships and solutions towards
improved individual and population health outcomes.
CLINICAL EFFECTIVENESS MEDICAL ACCESS EFFECTIVENESS ECONOMIC EFFECTIVENESS
1. EFFICACY 4. VALUE-ADDED SERVICES 7. COST OF ILLNESS
2. SAFETY 5. MANAGED-ENTRY AGREEMENTS 8. COST-EFFECTIVENESS EVIDENCE
3. QUALITY 6. IMPACT INFORMATION 9. BUDGET IMPACT ANALYSIS
Symptoms Relief Training Programs Direct Costs
Survival Diagnostic Tools Indirect Costs
Quality of Life Patient or Provider Services Intangible Costs
Frequency of Adverse Events Performace-Based Agreements Cost-Utility Analysis
Serious Adverse Events Financial-Based Agreements Cost-Benefit Analysis
Risk Management Plan Risk-Sharing Arrangements Cost-Effectiveness Analysis
Good Manufacturing Practices Epidemiological Burden Current Technology Mix Cost
Bioavailability Evidence-Based Clinical Research New Technology Mix Cost
Bioequivalency Real World Evidence Research Comorbidity Related Costs
Table 1 NEW TECHNOLOGY COST-EFFECTIVENESS CHECKLIST *