John Q. Wong, MD, MSc30 September 2010

Pharmaco-Economics

QuizEthics of health economicsQuick guide to types of economic evaluationCritical appraisal of a CEA articleHomework

Outline

1. By how many months does bevacizumab (Avastin) extend the life of lung cancer patients when used at double the regular dose?

2. The claim that trastuzumab (Herceptin) increases survival by almost 50% is based on what measure of association?

3. In the economic evaluation study of Drummond et al, which two regimens are being compared?

4. Which of the two regimens in #3 was discovered to be more effective?

5. Which of the two regimens in #3 was discovered to be less costly?

Quiz

Ethics of Health Economics

What is the utilitarianism?Health care examplesCounter-example

Ethical basis of health economics

Belief: human life is pricelessImplications

Social worthCost of treatmentMoral obligation

Fleck's Article

Why a price has to be placed on human lifeHealth care resources are limitedRationing decisions are being made whether

we like it or notSometimes, prolongation of life is marginalWithout conscious rationing, health priorities

can become skewedA just rationing process is explicit, rational,

and democratic

Fleck's Article

Breast cancer recurrenceWithout trastuzumab (Herceptin) = 17%With = 11%

Compute RRARRNNT

Which measure of association should be used when talking about populations (public health)?

Uses of measures or association

Quick Guide to Types of Economic Evaluation

Types of Economic EvaluationsAre both costs (inputs) and consequences (outputs) of the alternatives

examined?Is there

comparison of two or more alternatives?

No Yes

No Examines only consequences

Examines only costs

Partial Evaluation•Outcome description

Partial Evaluation•Cost description

Partial EvaluationCost-outcome description

Yes Partial Evaluation•Efficacy or effectiveness evaluation

Partial Evaluation•Cost analysis

Full Economic Evaluation•Cost-minimization analysis•Cost-effectiveness analysis•Cost-utility analysis•Cost-benefit analysis

Forms of Economic EvaluationCost-minimization analysis

Outcomes are the same in terms of volume and type

Cheapest choice based on grounds of efficiencyBranded vs generic drugs

Forms of Economic EvaluationCost-effectiveness analysis

Volume of outcomes are differentEfficient choice

Which option costs least to produce a unit of outcome

Different interventions that prolong life for people with breast cancer

Forms of Economic EvaluationCost-utility analysis

Type of outcomes are differentUse a common outcome currency

QALY or DALYChoice

Depend on the cost of producing a unit of the chosen currency

Hip replacements vs. CABG vs. hemodialysis

Forms of Economic EvaluationCost-benefit analysis

Places monetary values on benefitsTo enable comparison with the monetary units used

to measure costsDoing something vs doing nothing

Instead of vs. doing something elseWhether or not to invest in crash barriers along a

road to avoid traffic deaths and injuries

Critical Appraisal of an Article on Economic Evaluation

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 PneumoniaDrummond, Becker, Hux, et al

Questions Research questionDescription of

alternativesMeasurement of

effectivenessIdentification of

costs and consequences

Measurement of costs and consequences

Valuation of costsAdjustment for

differential timingIncremental analysisSensitivity analysisDiscussion included

users’ concerns

Answering critical appraisal questionsChoices

YesNoCan’t tell

Support answer by paraphrasing and citing the appropriate portions of the article

Was a well-defined question posed in answerable form? Both costs and

effects studied?Comparison of

alternatives?Perspective

PatientProviderPayorSociety

Yes Variables (abstract)

ExposureMoxifloxacin vs. co-

amoxiclav +/- clarithromycin

OutcomeCure rate 5-7 days after

treatmentCosts

Perspective (abstract)French and German

health care system

Was a comprehensive description of the competing alternatives given?Detailed descriptionReferences for

clinical protocolsIdentification 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. 1No alternatives

omittedNo flow chart

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?

YesTARGET study

Were all important and relevant costs and consequences for each alternative identfied? Costs

Capital costsOperating costs

ConsequencesClinically relevant

outcomes?All relevant

viewpoints?

Yes Costs

P. 528, column 2, par. 2

ConsequencesP. 529, column 1,

par. 1

Were costs and consequences measured accurately in appropriate physical units?Consequences

Physical unitsCosts

Quantities of all resources used

Unit costs of each resource

Total costsAny items omitted?

YesConsequences

P. 529, column 1, par. 1

CostsP. 528, column 2,

pars. 2 and 3

Were costs valued credibly?Source data for costsMarket values used?If not used, what

adjustments were made to approximate market values?

YesAdjustments

P. 528, column 1, par. 6

P. 528, column 2, pars. 1-4

Were costs and consequences adjusted for differential timing?

Discounting Time preference

An advantage to receive a benefit earlier and/or to incur a cost later

It gives you more optionsBenefit in the future valued less highly than a

benefit today

Discounting Why people have a positive time preference

Short-term view of lifeThe future is uncertainIndividuals expect to be wealthier in the futureCan obtain a positive rate of return from a

riskless investmentGive costs and benefits in the future a

present-day valueWHO = 3% discount per year

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

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

Incremental cost-effectiveness ratio (ICER)

= CostA - CostB

EfficiencyA - EfficiencyB

ICER MatrixIncremental effectiveness of treatment compared to control

Incremental cost of treatment compared to control

More Same Less

More 7 4 2

Same 3 9 5

Less 1 6 8

Key

Strong dominance for decision1 = accept treatment2 = reject treatment

Weak dominance for decision3 = accept treatment4 = reject treatment5 = reject treatment6 = accept treatment

Non-dominance; no obvious decisions7 = 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?

Was an incremental analysis of costs and consequences of alternatives performed?Incremental costs

compared to incremental effects?

Moxifloxacin dominant

ICER not necessaryP. 531, table 3

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

Data on costs and outcomes are seldom precise

To check how much a range of estimates affect the final outcome

Sensitivity analysis

Was allowance made for uncertainty in the esttimates of costs and consequences?If real data,

statistical tests performed?

Sensitivity analysisJustification for

Variables adjustedRange of values

Were the study results sensitive?

YesP. 521, tables 3 and

4P. 532, figures 1 and

2

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

Critical appraisal ofSchermer, 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 workDue: 6 Oct, 12 nn via email to Keshia

Homework