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Pharmaco -Economics

Pharmaco -Economics. John Q. Wong, MD, MSc 30 September 2010. Outline. Quiz Ethics of health economics Quick guide to types of economic evaluation Critical appraisal of a CEA article Homework. Quiz.

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Pharmaco -Economics

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  1. Pharmaco-Economics John Q. Wong, MD, MSc 30 September 2010

  2. Outline • Quiz • Ethics of health economics • Quick guide to types of economic evaluation • Critical appraisal of a CEA article • Homework

  3. Quiz • By how many months does bevacizumab (Avastin) extend the life of lung cancer patients when used at double the regular dose? • The claim that trastuzumab (Herceptin) increases survival by almost 50% is based on what measure of association? • In the economic evaluation study of Drummond et al, which two regimens are being compared? • Which of the two regimens in #3 was discovered to be more effective? • Which of the two regimens in #3 was discovered to be less costly?

  4. Ethics of Health Economics

  5. Ethical basis of health economics • What is the utilitarianism? • Health care examples • Counter-example

  6. Fleck's Article • Belief: human life is priceless • Implications • Social worth • Cost of treatment • Moral obligation

  7. Fleck's Article • Why a price has to be placed on human life • Health care resources are limited • Rationing decisions are being made whether we like it or not • Sometimes, prolongation of life is marginal • Without conscious rationing, health priorities can become skewed • A just rationing process is explicit, rational, and democratic

  8. Uses of measures or association • Breast cancer recurrence • Without trastuzumab (Herceptin) = 17% • With = 11% • Compute • RR • ARR • NNT • Which measure of association should be used when talking about populations (public health)?

  9. Quick Guide to Types of Economic Evaluation

  10. Types of EconomicEvaluations

  11. Forms of Economic Evaluation • Cost-minimization analysis • Outcomes are the same in terms of volume and type • Cheapest choice based on grounds of efficiency • Branded vs generic drugs

  12. Forms of Economic Evaluation • Cost-effectiveness analysis • Volume of outcomes are different • Efficient choice • Which option costs least to produce a unit of outcome • Different interventions that prolong life for people with breast cancer

  13. Forms of Economic Evaluation • Cost-utility analysis • Type of outcomes are different • Use a common outcome currency • QALY or DALY • Choice • Depend on the cost of producing a unit of the chosen currency • Hip replacements vs. CABG vs. hemodialysis

  14. Forms of Economic Evaluation • Cost-benefit analysis • Places monetary values on benefits • To enable comparison with the monetary units used to measure costs • Doing something vs doing nothing • Instead of vs. doing something else • Whether or not to invest in crash barriers along a road to avoid traffic deaths and injuries

  15. Critical Appraisal of an Article on Economic Evaluation

  16. An Economic Evaluation of Sequential IV/PO Moxifloxacin Therapy Compared to IV/PO Co-Amoxiclav with or without Clarithromycin in the Treatment of Community-Acquired Pneumonia Drummond, Becker, Hux, et al

  17. Questions • Research question • Description of alternatives • Measurement of effectiveness • Identification of costs and consequences • Measurement of costs and consequences • Valuation of costs • Adjustment for differential timing • Incremental analysis • Sensitivity analysis • Discussion included users’ concerns

  18. Answering critical appraisal questions • Choices • Yes • No • Can’t tell • Support answer by paraphrasing and citing the appropriate portions of the article

  19. Was a well-defined question posed in answerable form? • Both costs and effects studied? • Comparison of alternatives? • Perspective • Patient • Provider • Payor • Society • Yes • Variables (abstract) • Exposure • Moxifloxacin vs. co-amoxiclav +/- clarithromycin • Outcome • Cure rate 5-7 days after treatment • Costs • Perspective (abstract) • French and German health care system

  20. Was a comprehensive description of the competing alternatives given? • Detailed description • References for clinical protocols • Identification of control arm • Any important alternatives omitted? • Nice to have • Flow chart or decision tree of patients • Yes • Detailed description, references, and identification of control arm • p. 527, column 1, par. 1 • No alternatives omitted • No flow chart

  21. Was there evidence that the program's effectiveness had been established? • Randomized controlled trial done? • Efficacy or effectiveness study? • Meta-analysis or systematic review done? • If observational studies used, what were the biases? • Yes • TARGET study

  22. Were all important and relevant costs and consequences for each alternative identfied? • Costs • Capital costs • Operating costs • Consequences • Clinically relevant outcomes? • All relevant viewpoints? • Yes • Costs • P. 528, column 2, par. 2 • Consequences • P. 529, column 1, par. 1

  23. Were costs and consequences measured accurately in appropriate physical units? • Consequences • Physical units • Costs • Quantities of all resources used • Unit costs of each resource • Total costs • Any items omitted? • Yes • Consequences • P. 529, column 1, par. 1 • Costs • P. 528, column 2, pars. 2 and 3

  24. Were costs valued credibly? • Source data for costs • Market values used? • If not used, what adjustments were made to approximate market values? • Yes • Adjustments • P. 528, column 1, par. 6 • P. 528, column 2, pars. 1-4

  25. Were costs and consequences adjusted for differential timing?

  26. Discounting • Time preference • An advantage to receive a benefit earlier and/or to incur a cost later • It gives you more options • Benefit in the future valued less highly than a benefit today

  27. Discounting • Why people have a positive time preference • Short-term view of life • The future is uncertain • Individuals expect to be wealthier in the future • Can obtain a positive rate of return from a riskless investment • Give costs and benefits in the future a present-day value • WHO = 3% discount per year

  28. Were costs and consequences adjusted for differential timing? • Future costs and consequences discount to present values? • Any justification for discount rate? • No, but not necessary since costs and consequences all occur within one year

  29. Was an incremental analysis of costs and consequences of alternatives performed?

  30. Incremental cost-effectiveness ratio (ICER) = CostA - CostB EfficiencyA - EfficiencyB

  31. ICER Matrix

  32. Strong dominance for decision 1 = accept treatment 2 = reject treatment Weak dominance for decision 3 = accept treatment 4 = reject treatment 5 = reject treatment 6 = accept treatment Non-dominance; no obvious decisions 7 = is added effect worth the added cost to adopt treatment? 8 = is reduced effect acceptable given reduced cost to adopt treatment? 9 = neutral on cost and effects. Other reasons to adopt treatment? Key

  33. Was an incremental analysis of costs and consequences of alternatives performed? • Incremental costs compared to incremental effects? • Moxifloxacin dominant • ICER not necessary • P. 531, table 3

  34. Was allowance made for uncertainty in the esttimates of costs and consequences?

  35. Sensitivity analysis • Data on costs and outcomes are seldom precise • To check how much a range of estimates affect the final outcome

  36. Was allowance made for uncertainty in the esttimates of costs and consequences? • If real data, statistical tests performed? • Sensitivity analysis • Justification for • Variables adjusted • Range of values • Were the study results sensitive? • Yes • P. 521, tables 3 and 4 • P. 532, figures 1 and 2

  37. Did the presentation and discussion of study results include all issues of concern to users? • Conclusion based on ICER? • Interpreted correctly? • Results compared with previous studies? • External generalizability discussed? • Other issues discussed: ethics, equity? • Implementation issues? • Feasibility • Alternative use of freed resources • Conclusion • P. 533, column 1, par. 3 • Comparion • P. 533, column 2, par. 2 • External generalizability • P. 533, column 1, par. 3 • Ethics • P. 534, column 1, par. 1 • Equity • P. 534, column 2, par. 1 • Feasibility • P. 533, column 1, par. 1 • Alternative use • No

  38. Homework • Critical appraisal of • Schermer, Thoonen, Van den Boom, et al. Randomized Controlled Economic Evaluation of Asthma Self-Management in Primary Health Care. Amer J Resp and Crit Care Med, Vol 166, 2002. • Group work • Due: 6 Oct, 12 nn via email to Keshia

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