Pharmacoeconomics Flashcards
What are the 5 types of cost illness?
- Cost of Illness
- Cost Minimization
- Cost-Benefit
- Cost-Effectiveness
- Cost-Utility
What is the outcome of Cost Minimization?
Equivalent Measure
What is the outcome of Cost Benefit?
Dollars
What is the outcome of Cost Effectiveness
Clinical Measure/ Natural Units
What is the outcome of Cost-Utility?
Quality-Adjusted Life Years
What is the cost of illness?
- economic impact of disease on a population
- measures the economic burden of disease
What are the advantages of cost of illness?
identifying disease
epidemiology
outcomes and consequences
What is an example of cost of illness?
cost attributable to Type II diabetes in adults in the U.S
What are the three broad components of illness?
- medical resources used to treat the illness
- the non-medical resources associated
- lost productivity due to illness or disability
What is cost minimization?
compares two or more alternative treatments that produce clinically equivalent outcomes
* cannot be used when outcomes are different
* you want to choose the one with the smallest total cost
What is an example of cost minimization?
treating patient with the same therapy in hospital vs home
What is cost effectiveness?
measuring therapeutic effect in natural units in order to compare the cost per gain in therapeutic effect
What is the limitation for cost effectiveness?
must choose a single measure so different outcomes cannot be compared
What is the advantage for cost effectiveness?
clinicians are familiar with measuring these outcomes and they are routinely collected
What is the equation for cost effectiveness?
cost of treatment/ therapeutic effect (Natural units)
What is the importance of cost effectiveness?
developing a new drug is a HUGE investment and companies try to recoup that upfront investment with drug pricing after approval
cost will transfer to the patient and the insurer due to the payment companies have to make to create the drug
What are the cost effective therapies?
therapies with outcomes worth their corresponding costs relative to competing alternatives
- you define the worth
What are examples where Cost Effective Therapies are the best techniques?
- comparing the costs and outcomes of two or more antihypertensives
- compare two programs designed to prevent excess mortality
What is cost benefit analysis?
- evaluation technique for comparing the value of all resources consumed (costs) in implementing a program or intervention against the value of the outcome (benefits) from that program or intervention
- broad usually addresses societal issues
- valued in monetary units
Examples of Cost Benefit Analysis?
- AIDS prevention and awareness programs
- Smoking cessation intervention
- Diabetes drug adherence
- Breast cancer screening
What type of outcomes are not appropriate to use in cost-utility analysis?
intermediate outcomes
What does Cost-Utility Analysis require?
the measurement of final outcomes in terms of changes in life expectancy adjusted for patient preferences
What is QALY?
- quality adjusted life years
- economics attempt to assign value or benefits to actions and behaviors
- an attempt to determine the value of living an extra year with pain or illness versus living those extra years pain and symptom free
What is utility?
measures outcomes based on years of life that are adjusted by utility weights
* no real consensus on how these should be measured
What is cost utility?
the most difficult and expensive economic evaluation method to use
Examples of using cost utility?
- Psychological well-being physical and social function are important in the treatment of arthritis
- Chemotherapy may increase survival but decrease well-being, both quality and quantity of life are important
How are costs measured?
over a relevant time period such as a month or year
* dependent on span of illness
How do we determine the value of cost?
- determining the amount for each item listed can be difficult, especially for indirect and intangible costs
- it is important in determining the opportunity cost
What is the Average Wholesale Price?
the “sticker price” of a medication-pretty much like the sticker price of a car
What is the Wholesale Acquisition Cost?
the “catalog” price of the drug; its the estimate of what wholesalers pay to the manufacturer of the drug
What is the Average Manufacture’s Price?
that is the most accurate estimate of what pharmacies pay for a drug
What is discounting?
if costs of products or services extend over more than one year, the time value of money must be taken into account
What is sensitivity analysis?
testing the variability of outcome or cost assumptions under different scenarios (best, expected, worst case)
What type of approach is used when conducting pharmacogenomic studies?
systemic approach to decision making under conditions of uncertainty
What is simulation/modelling?
- used when direct observation not feasible and when time or money constraints are prohibitive
- sum of probabilities of a cost occurring x the cost is the estimated cost of each treatment alternative
