Editorial
Why study pharmacoeconomics? ‘Pharmacoeconomics research is a flourishing industry with many practitioners, a large research and applications agenda, several journals and flourishing professional societies.’
Josephine A Mauskopf, PhD, Executive Director, RTI Health Solutions, 3040 Cornwallis Road, Research Triangle Park, North Carolina, USA 27709 Tel.: +1 919 541 6996 Fax: +1 919 541 7222
[email protected] www.rtihs.org
Why study pharmacoeconomics? Well the first 1 year of treatment. The clinical data showed reason is so that you will know how to spell it!!! that the drug would increase life expectancy You will not get any help from your ‘spell- for persons with AIDS by approximately checker’ software as I realized when I sat down 1 year. My model therefore showed that the incremental cost-effectiveness ratio for AZT to write this editorial! Before I try to give a more serious answer, I was $10,000, which was then and is now conneed to start with a little history – when was the sidered to be good value for money. However, the idea of having to pay term pharmacoeconomics first coined and why did it catch on? – and an attempt at a definition $10,000 each year for a drug was shocking to persons with AIDS and to the public. This of the term – what is pharmacoeconomics? Probably one of the first times that the term was especially so in the US where at that pharmacoeconomics was used in a public time many people did not have any insurforum was in 1986, at a meeting of Pharma- ance coverage for outpatient drugs. This cists in Toronto, Canada, when Ray resulted in a lot of negative publicity for BurTownsend, from the Upjohn Company, used roughs Wellcome Co. and for the whole the term in a presentation. Ray and a few oth- pharmaceutical industry. The industry knew that AZT was just the ers had been performing studies using the term pharmacoeconomics within the pharmaceuti- beginning. Drug development costs had risen because of cal industry since the early eighties. ‘Measurement and presentation increased regulatory requirements Today, pharmacof a comprehensive set of to protect the puboeconomics outcomes that describe the lic from ineffecresearch is a flourishing industry consequences of the use of a tive or unsafe drugs following with many practinew drug.’ the thalidomide tioners, a large research and applications agenda, several jour- tragedy. New techniques for drug design and nals and flourishing professional societies new types of drugs engineered using the techincluding the International Society for Phar- niques of biotechnology, meant that the cost of manufacturing drugs was also likely to rise. Both macoeconomics and Outcomes Research. What had happened just prior to 1986 that of these increases in costs meant that drug comprompted Ray to coin the term? Why did the panies would likely be charging more for drugs term catch on? Let me give you a little more that successfully made it to market, in order to history, personal this time, that might suggest obtain an acceptable return on their higher the answers to these questions. Around this investment. I think that these changes may be same time, my career in pharmacoeconomics some of the reasons that the new disipline of started with a study of the cost-effectiveness of pharmacoeconomics flourished. Ray’s initial definition of pharmacoeconomAZT for treatment of persons with AIDS. This was a modeling study based on data from ics was ‘the description and analysis of the a clinical trial, ACTG 002. The cost for AZT costs of drug therapy to healthcare systems when it was first introduced was $10,000 for and society’. Later this definition was
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Mauskopf
How can you learn to be a consumer of pharmacoeconomic amended by Ray and some of his colleagues to include both ‘the costs and quality of life consequences associated with the studies? For those who only need to understand the results of use of a new drug therapy’. My own definition of pharmac- pharmacoeconomic studies, the simplest way to learn this skill oeconomics is ‘the measurement and presentation of a compre- would be by taking a single pharmacoeconomics course over a hensive set of outcomes that describe the consequences of the 1 year time period during university training in the primary use of a new drug’. These outcomes include the impact of the discipline or as a postgraduate course. This course would cover new drug on healthcare costs and individual quality of life but the main topics in each of the disciplines. Many such courses also include the impact of the new drug on individual func- have been developed. Why should these people all study pharmacoeconomics? tional status and productivity, as well as the drug’s impact on The main reason for studying pharmacoeconomics is to be caregivers and families and society. Since 1986, many methodological advances have been able to estimate and understand the full impact of a new thermade that provide the tools that we need to measure this apy. This impact will be on the individual’s health and safety comprehensive set of outcomes. These advances include but also on their use of healthcare services and the cost of healthcare, on their quality of strategies for collecting phar‘The main reason for studying life and functional status, on macoeconomic data during clinical trials. Profile meas- pharmacoeconomics is to be able to their families and friends and on society as a whole. Pharures for measuring changes estimate and understand the full macoeconomics extends the in general and disease-spemeasurement of the impact cific health status have been impact of a new therapy.’ of a new drug beyond safety developed and validated using psychometric techniques. Economic techniques for and efficacy to all these additional outcomes. If we truly want eliciting preferences have been applied to the measurement to understand the value of a new drug, we need to understand of drug value. Statistical techniques have been developed, its impacts on this broad range of outcomes. The price of the using both frequentist and Bayesian approaches, for design- drug will then determine whether the drug is good value for ing trials and analyzing both trial and observational data for money, depending on its impact on this broad range of outuse in pharmacoeconomic evaluations. The reference case for comes and on the value that the decision-maker places on cost-effectiveness ratios has been developed and methods for these changes in outcomes. Why do we care about the impact of a new drug? Primarily estimating confidence limits around these ratios proposed. The concept of budget and population impact estimates has we care because the healthcare decision-makers (governments, been introduced. All of these advances have given us tools doctors, payers, patients) all care. They are vitally interested in that we need to measure the comprehensive set of outcomes better treatments for our diseases as well as better preventive associated with a new drug. They now form the body of strategies. However, they have realized that, as we have become more successful in preventing and treating disease, we have knowledge that is pharmacoeconomics. Who should study pharmacoeconomics? Anyone who is had to devote more and more of our scarce resources to healthinvolved with healthcare decision-making, including suppli- care. Thus, we now need to question more closely than ever ers of healthcare products, such as pharmaceutical compa- whether each new drug is good value for money compared nies or medical device companies, the consumers of such with current treatment. Moreover, as countries try to control the rising costs of products and the healthcare providers. All should know enough about the different elements of a pharmacoeco- healthcare in their aging populations, they have introduced nomic analysis to be able to understand the results of the requirements for economic evaluations of new drugs. They analysis. Those who plan to perform the pharmacoeconomic are all asking the question, is the new drug good value for money and what is society willing to pay for it? analyses should have a more extensive training. Guidelines for how to perform these economic analyses and How can you become a practising pharmacoeconomist? What sort of professional training is needed? You need training how to present the information were developed first in Ausin Pharmacy, Medicine, Psychometrics, Economics, Statistics, tralia and Canada and then in many European countries and, Epidemiology, Decision Analysis, Survey Techniques, Opera- most recently, by managed care organizations in the US. All of tions Research and a whole host of other disciplines. Clearly, it these guidelines require that a pharmaceutical company estiis not practical to obtain formal training in all of these disci- mate a comprehensive set of changes in outcomes associated plines, so most practitioners get training in one or two of the with the new drug. The careful study of the body of knowledge that is pharmackey disciplines and then learn something about the other disciplines on-the-job. In practice, most pharmacoeconomic oeconomics and further development of that knowledge are parprojects are completed by a team of people who have training ticularly important because of the many controversies still in the different disciplines so that the results of a pharmac- remaining in the use of pharmacoeconomic analyses for the allooeconomic study are not dependent on one person being an cation of funding to the use of new treatments. For example, there is no agreement on what should be the benchmark value for expert in all the relevant disciplines.
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Expert Rev. Pharmacoeconomics Outcomes Res. 1(1), (2001)
Why study pharmacoeconomics?
a cost-effectiveness ratio and how to restrict delivery of healthcare and policy uncertainties still present in the pharmacoecothat has a cost-effectiveness ratio above the threshold value. There nomic analyses are properly accounted for when the results is still no agreement on how to incorporate uncertainty of the of such analyses are used to help make healthcare decisions. results into decision-making and how to make decisions when only Formal training in pharmacoeconomics will ensure that the poor quality data are available. The choice of comparator, popula- methodological and policy uncertainties still present in the pharmacoeconomic analyses tion subgroups, time horizon ‘It is critical that all healthcare are properly accounted for and perspective all make a big when the results of such analdifference to the results and decision-makers have as much yses are used to help make require many more data than are generally available. It is also hard education in pharmacoeconomics healthcare decisions. Finally, to illustrate the to find a way to present the data as possible...’ field’s complexity, how many from a pharmacoeconomic analysis to decision-makers that addresses these issues without making pharmacoeconomists does it take to change a light bulb? it completely incomprehensible to them. Finally, there are contro- The answer is four! One to estimate the cost of the new light versies about who should fund the studies and whether publication bulb, one to estimate the life expectancy of this new light bulb, one to estimate the quality of life associated with the bias results in inefficient use of healthcare resources. For all of these reasons, it is critical that all healthcare light from the new light bulb and one to package the infordecision-makers have as much education in pharmacoeco- mation so that it convinces the healthcare decision-maker to nomics as possible. This will ensure that the methodological take out the old light bulb and put in the new one!
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