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Pharmacoeconomics & pharmacoepidemioology
- 1. Pharmacoeconomics & Pharmacoepidemiology Dr. Divya Singh JR- II Department of Pharmacology & Therapeutics
- 3. Introduction • Term pharmacoeconomics - – Townsend in 1986 Pharmacoeconomics Oikonomia Management of a household Pharmakon Drug
- 4. Pharmacoeconomics is a scientific discipline concerned with the cost and value of drugs, often with the goal of optimizing the allocation of health care resources.
- 5. Definition “The field of study that evaluates the behaviour of individuals, firms, and markets relevant to the use of pharmaceutical products, services, and programs, and which frequently focuses on the costs (inputs) and consequences (Outcomes) of that use” -ISPOR
- 6. Need And Scope • Healthcare in India - easy availability and affordability for the patient • Responsibility of the caregivers – maximize the beneficial outcomes – minimize the financial burden – increase humanistic outcome goals
- 7. Need And Scope • To find the optimal therapy at the lowest price. • In Industry- To decide among specific research and development alternatives. • In Government- To determine program benefits and prices paid. • In Private Sector- To design insurance benefit coverage
- 9. Basic pharmacoeconomic equation – Left hand side of equation - cost analysis (or a partial economic analysis) – Right hand side of equation -clinical or health outcome study COSTS(₹) OUTCOMESRX
- 10. Basic pharmacoeconomic equation – Complete pharmacoeconomic study -evaluation of both sides of equation COSTS(₹) OUTCOMESRX
- 11. The Pharmaconomic Data – Evaluation Of Pharmacoeconomic Data Along Side Clinical Trial – Naturalistic Pharmacoeconomic Study – Economic Modelling On The Basis Of Prospectively Collected Clinical Trial
- 12. Economic value of a new medicine = + COMPARATOR VALUE DIFFERENTIAL VALUE ( savings , clinical benefits , survival /Quality of Life benefits , value in use ) ECONOMIC VALUE
- 13. Evaluations from a pharmacoeconomic perspective COSTS(₹) OUTCOMESRX Evaluation of cost of treatment Evaluation of health outcome after treatment
- 14. Costs From A Pharmacoeconomic Evaluation Perspective : • Direct Medical costs • Direct Non Medical cost • Indirect cost • Intangible costs
- 15. Examples of type of costs Direct Medical cost Medications ( monitoring , administration) Diagnostic tests Clinic visits Nursing services Ambulance services Emergency department visits Hospitalizations Direct Non Medical cost Travel costs to receive health care (bus, gas, taxi) Nonmedical assistance related to condition (e.g., Meals-on-Wheels, homemaking services) Hotel stays for patient or family for out-of-town care
- 16. Examples of type of costs Indirect cost Lost productivity for patient Lost productivity for unpaid caregiver (e.g., family member, neighbour, friend) Lost productivity because of premature mortality Intangible costs Pain and suffering Fatigue Anxiety
- 17. The Outcome Measurement • Final health outcome considered as the effectiveness measure • If health outcome are multidimensional – Result outcomes adjusted in a single index using health utilities – QALYs , Health year equivalent
- 18. Outcomes • Clinical -Cure, comfort and survival • Humanistic -Physical, emotional, social function, role performance • Economic -Expense, saving, cost avoidance
- 19. Types Of Pharmacoeconomic Studies Based On Health Gain Outcome • Four basic types – Cost- Minimization Analysis (CMA) – Cost –Effectiveness Analysis (CEA) – Cost – Benefit Analysis (CBA) – Cost – Utility Analysis (CUA)
- 20. Cost Minimization Analysis • Simplest • Outcomes - assumed to be equivalent • Only costs of intervention compared • Cannot be used when – outcomes of intervention are expected to be different
- 21. TYPES OF PHARMACOECONOMIC STUDIES BASED ON HEALTH GAIN OUTCOMES METHODOLOGY COST MEASUREMENT UNIT OUTCOME MEASUREMENT UNIT Cost- Minimization Analysis (CMA) Rupees or Monetary units Assumed to be equivalent in comparable groups COSTS(₹) OUTCOMES
- 22. Cost Effectiveness Analysis • Outcome - natural units • Outcomes easier to quantify • Programs with different types of outcome can not be compared
- 23. Cost Effectiveness Analysis Two types – Average cost-effectiveness ratio (ACER) = Total health care costs (₹) ÷ clinical outcomes(not in ₹ ) – Incremental cost-effectiveness ratio (ICER ) = COST (A)- COST (B)(₹) ÷ Effectiveness A(%) - Effectiveness B(%)
- 24. TYPES OF PHARMACOECONOMIC STUDIES BASED ON HEALTH GAIN OUTCOMES METHODOLOGY COST MEASUREMENT UNIT OUTCOME MEASUREMENT UNIT Cost –Effectiveness Analysis (CEA) Rupees or Monetary units Natural units (no of life years gained , mm Hg B.P. , mMol /L of blood sugar COSTS(₹) OUTCOMES
- 25. Cost Utility Analysis • Outcomes -years of life that are adjusted by “utility” weights • Range from 1.0 for “perfect health” to 0.0 for “dead” • There are no consensus how to measure the utility weights • C:U Ratio = COST÷ QALY gained
- 26. TYPES OF PHARMACOECONOMIC STUDIES BASED ON HEALTH GAIN OUTCOMES : METHODOLOGY COST MEASUREMENT UNIT OUTCOME MEASUREMENT UNIT Cost – Utility Analysis (CUA) Rupees or Monetary units Quality adjusted life years (QALYs) or other utilities COSTS(₹) OUTCOMES
- 27. Cost Benefit Analysis • Both cost and benefits -monetary units • Two major advantages – advantages of implementation of treatment plan can be determined – Multiple programs can be compared • Difficult to place monetary values on health outcomes
- 28. TYPES OF PHARMACOECONOMIC STUDIES BASED ON HEALTH GAIN OUTCOMES METHODOLOGY COST MEASUREMENT UNIT OUTCOME MEASUREMENT UNIT Cost – Benefit Analysis (CBA) Rupees or Monetary units Rupees or Monetary units COSTS(₹) OUTCOMES
- 29. Other Types Of Analysis • Cost Sequence Analysis – Lists of costs and various outcomes presented – No direct calculation or comparison between interventions
- 30. Other Types Of Analysis • Cost Of Illness Analysis : – Total economic burden (including prevention , treatment , losses caused by morbidity and mortality ) – May be direct costs or indirect costs
- 31. Importance Of Economic Evaluation In setting up guidelines Amending existing policies Aiding clinical decision making Resource allocation becomes more authentic Develop effective, efficacious and available treatment to the intended population. To lessen health expenditures
- 32. Examples of pharmacoeconomic studies • To investigate the cost-effectiveness – administering tranexamic acid (TXA) for the treatment of significant haemorrhage following trauma • Early administration (within 3 hours) of TXA would cost $ 66 (4837 ₹ )per LY saved in India
- 33. • Cost- Effectiveness of Preventing AIDS Complications • 3- month course of isoniazid plus rifampin and a 6-month course of isoniazid • Both decrease TB incidences in HIV patients
- 34. Conclusion • Time and money can only be spent once- choice is inevitable • Pharmacoeconomics can enhance the quality of practice by strengthening evaluation process and increasing the probability that deliver better value in patient care
- 35. Pharmacoepidemiology Pharmakon -drug Epi- upon or among Demos – people or district Logos – study
- 36. Definition The study of the use and effects of medication in large number of people The application of epidemiologic knowledge , methods and reasoning to the reasoning of the effects (beneficial and adverse) and use of drugs in human populations
- 38. Pharmacoepidemiological Research • Pharmacoepidemiological studies focus on – Global trends in prescribing – Medication adherence – Lifestyle effects on drug therapy – Special population (Elderly, Pediatric, etc.) drug therapy – Drug Interactions – Predictable ,uncommon and unpredictable ADRs
- 39. Contributions of pharmacoepidemiology • Supplementary information • New type of information not available from premarketing studies • General contributions from pharmacoepidemiology
- 40. Reasons to perform pharmacoepidemiologic studies • Regulatory – earlier approval, response to query • Marketing – name recognition , repositioning • Legal – liability litigation • Clinical – hypothesis testing , generating , safety
- 41. Epidemiologic Study Designs Epidemiologic Study Experimental trial Randomized controlled trial Non – randomized controlled trial Observational studies Analytical study Cohort study Case control study Cross- section study Descriptive study
- 42. Summary • Pharmacoeconomics provide the means to quantify the value of pharmacotherapy through balancing costs and outcomes • Healthcare professionals will be prepared to make better, more informed decisions regarding the use of pharmaceutical products and services.
- 43. TYPES OF PHARMACOECONOMIC STUDIES BASED ON HEALTH GAIN OUTCOMES METHODOLOGY COST MEASUREMENT UNIT OUTCOME MEASUREMENT UNIT Cost- Minimization Analysis (CMA) Rupees or Monetary units Assumed to be equivalent in comparable groups Cost –Effectiveness Analysis (CEA) Rupees or Monetary units Natural units (no of life years gained , mm Hg B.P. , mMol /L of blood sugar Cost – Benefit Analysis (CBA) Rupees or Monetary units Rupees or Monetary units Cost – Utility Analysis (CUA) Rupees or Monetary units Quality adjusted life years (QALYs) or other utilities
- 44. Summary • Information about drug safety and effectiveness that is not available from pre- marketing studies • Pharmacoepidemiology is a field, bridging between clinical pharmacology and epidemiology
- 45. Summary • From clinical pharmacology - focus of inquiry • From epidemiology - methods of inquiry
- 46. Thank you
Editor's Notes
- It compare the cost of various drugs with the outcomes, such as benefits of patients receiving the drugs and costs. Over the last decade there has been tremendous interest in economic evaluations of healthcare programmes, especially in the pharmaceutical field.
- Healthcare in developing countries including India is not solely driven by the best treatment option but by the easy availability and affordability for the patient . The responsibility and the difficulty of the caregivers thereby increases as to maximize the beneficial outcomes and minimize the financial burden and increase humanistic outcome goals
- Healthcare in developing countries including India is not solely driven by the best treatment option but by the easy availability and affordability for the patient . The responsibility and the difficulty of the caregivers thereby increases as to maximize the beneficial outcomes and minimize the financial burden and increase humanistic outcome goals
- The pharmacoeconomic evaluations can be classified according to the mode of data collection :
- The economic value of a new medicine is calculated based on the comparator price and differential value . The comparator value is the price of the standard therapy /regimen prevailing in the present healthcare
- Costs can be categorized broadly as Direct medical cost , Indirect medical cost , Indirect costs , Intangible costs Calculation of these costs takes into consideration various expenditure made during the course of illness and loss of income due to abstinence from work or decrease of productivity. Direct Costs : costs which are incurred for medical products or services used in prevention ,detection or treatment of the disease . Direct Non Medical Costs : Non medical services that are results of illness , but do not involve purchasing medical services . Indirect Non Medical Costs : costs of reduced productivity . Intangible Costs : costs of pain, suffering, anxiety, or fatigue that occurs because of an illness or the treatment of an illness
- Most of the economic evaluation guidelines,such as that of the ISPOR and the Dutch Health Care Insurance Board, are intended to be used for clinical studies and focus on measuring health(i.e. ,QALYs) as the main (or sometimes only)outcome measure of interest
- Simplest to conduct Outcomes are assumed to be equivalent Only the costs of the intervention is compared Cannot be used when outcomes of intervention are expected to be different
- Outcomes easier to quantify as compared to CUA OR CBA
- The average cost-effectiveness ratio (ACER) is the ratio of the cost to benefit of an intervention without reference to a comparator The incremental cost-effectiveness ratio (ICER) is a statistic used in cost-effectiveness analysis to summarise the cost-effectiveness of a health care intervention. It is defined by the difference in cost between two possible interventions, divided by the difference in their effect
- Measures the number of years of life gained by the treatment Rough estimate
- Both cost and benefits are valued in monetary units. Measuring both cost and benefits in monetary units has two major advantages Firstly the healthcare professionals can determine the effectiveness of the treatment and determine the advantages of implementation of that treatment plan Multiple programs can be compared for their effectiveness irrespective of similar or different outcomes. But it is difficult to place monetary values on health outcomes.
- Direct Costs : costs which are incurred for medical products or services used in prevention ,detection or treatment of the disease . Direct Non Medical Costs : Non medical services that are results of illness , but do not involve purchasing medical services . Indirect Non Medical Costs : costs of reduced productivity . Intangible Costs : costs of pain, suffering, anxiety, or fatigue that occurs because of an illness or the treatment of an illness Direct Costs : costs which are incurred for medical products or services used in prevention ,detection or treatment of the disease . Direct Non Medical Costs : Non medical services that are results of illness , but do not involve purchasing medical services . Indirect Non Medical Costs : costs of reduced productivity . Intangible Costs : costs of pain, suffering, anxiety, or fatigue that occurs because of an illness or the treatment of an illness
- Direct Costs : costs which are incurred for medical products or services used in prevention ,detection or treatment of the disease . Direct Non Medical Costs : Non medical services that are results of illness , but do not involve purchasing medical services . Indirect Non Medical Costs : costs of reduced productivity . Intangible Costs : costs of pain, suffering, anxiety, or fatigue that occurs because of an illness or the treatment of an illness Direct Costs : costs which are incurred for medical products or services used in prevention ,detection or treatment of the disease . Direct Non Medical Costs : Non medical services that are results of illness , but do not involve purchasing medical services . Indirect Non Medical Costs : costs of reduced productivity . Intangible Costs : costs of pain, suffering, anxiety, or fatigue that occurs because of an illness or the treatment of an illness
- An economic analysis is a guide to better investment to obtain a better health value. Developing countries like India where government does not hold the responsibility for health insurance or any scheme covering expenditure of the health expenditure. Surveys indicate that Indians spend most of their income for fooding or secondly for purchasing medications. Inflation is beating the income hikes in an average earning individual’s life where health expenditure is on bargain.
- an economic evaluation was carried out to investigate the cost-effectiveness of administering tranexamic acid (TXA) for the treatment of significant haemorrhage following trauma in India, Tanzania, and the United Kingdom. The LYs gained were estimated from a simple Markov model. The study showed that early administration of TXA to bleeding trauma patients is likely to be highly cost-effective in low, middle and high-income settings. Early administration (within 3 hours) of TXA would cost $ 66 per LY saved in India. However, it was important to demonstrate that it was likely to be cost-effective in countries with much more limited health care budgets, such as Tanzania and India where because of the high number of trauma victims this simple intervention can avert thousands of deaths every year
- A study from South India used the Cost- Effectiveness of Preventing AIDS Complications International model, a computer-based, state transition model of HIV and TB combined with data of a clinical trial from the National Institute for Research in Tuberculosis. The analysis showed that a 3- month course of isoniazid plus rifampin and a 6-month course of isoniazid alone both decrease TB incidences in HIV patients. The therapy also came out to be cost –effective by WHO criteria