pharmacogenomics(1).pptx pharmacology m pharm

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1. PHARMACOECONOMICS

2. DEFINITION The international society for Pharmacoeconomics and outcomes research (ISROR) defines, Pharmacoeconomics as “the field of study that evaluates the behavior of individuals, firms and markets relevant to the use of pharmaceutical products, service and programs which frequently focuses on the cost (input) and consequences (output) of the use” 2

3. GOALS To determine which healthcare alternatives provide the best healthcare outcome in terms of money spent. To improve the allocation of resources for pharmaceutical products and service. 3

4. IMPORTANCE To estimate and understand the full impact of new therapy. To estimate pharmaceutical expenditure which constitute a large part of healthcare expenditures. Evaluate increased demand in healthcare quality and services with respect to cost. Help to decide about which type of drug to develop. 4

5. HISTORICAL PERSPECTIVE During the early 1960s, pharmacy began evolving as a clinical discipline within the healthcare system. In 1978, McGhan , Rowland, and Bootman , introduced the concepts of cost–benefit and cost-effectiveness analyses. Actual term was coined by Townsend in 1986. 5

6. PRINCIPLES OF PHARMACOECONOMICS Pharmacoeconomics has been defined as the description of analysis of the cost of the drug therapy to health care system and society. It is the process of identifying, measuring and comparing the costs, risks and benefits of program, service or therapies and determining which alterative produces the best health outcome for the resource invested. It includes, Cost Outcome Prespective 6

7. 1) COST Cost is the total value of recourses consumed by a program or drug therapy of interest. Economic effects of medical care is sum of its costs and benefits. Involves all the resources that are used to produce and deliver a particular drug therapy Economic effects of medical care is sum of its costs and benefits Cost includes treatment cost, cost of treating ADR, nonmedical cost and loss of earnings 7

8. CLASSIFICATION OF HEALTH CARE COST Direct medical cost Cost associated with monetary transaction and represent cost for provision of care. It include the cost of drugs, laboratory tests, doctor’s fee, fee or salary for other health professionals, time, labour and hospitalization Direct Cost = Direct Medical Costs + Direct non-medical costs Direct non-medical costs Cost of non-medical services arising due to illness. It include cost of transportation, cost of special clothing or other items needed, expenses for food and family care 8

9. Indirect Nonmedical Costs Costs of reduced productivity and include wages and salaries lost due to morbidity and loss of income due to premature death or resignation from job due to inability to work. It include lost productivity from a disease, loss of earning Intangible Costs Non financial outcomes of disease and medical care, which cannot be expressed in money such as pain, suffering, inconvenience, and grief. Opportunity Costs Cost of economic benefit forgone when one therapy is used instead of the next best alternative therapy. It includes the cost of lost opportunity Incremental Costs – The extra costs required to purchase an additional unit of effect. 9

10. 2) OUTCOME Outcome is defined as the effects, outputs, or consequence of the program or drug therapy. Categorized as… Economic outcomes Related to direct, indirect, and intangible costs with the consequences of medical treatment alternatives. Economic outcomes can be expressed in terms of money value. Clinical outcomes Medical events that occur as a result of disease or treatment, like adverse effects or efficacy. 10

11. Humanistic outcomes Outcomes of diseases or their treatment on functions or quality of life of patient. Eg : Factors like healthy life, general well being, social compatibility and physical functions and life satisfaction Outcome can be Positive : Desired effect of drug Negative : Undesired or adverse effect of drug 11

12. 3) PERSPECTIVES Assessing the cost and consequences, the value of a pharmaceutical product or services depends heavily on the perspective of evaluation. A pharmacoeconomics evaluation can assess the value of a product or service from single or multiple perspective Common perspective include Patient perspective Provider perspective Payer perspective Society perspective 12

13. PATIENT PERSPECTIVE Patient perspective is important because patients are the ultimate consumers of health care service. Cost from the perspective of patients are essentially what patients pay for a product or service. Consequences from a patient’s perspective are the clinical effects, both positive and negative of a program or treatment alternative PROVIDER PERSPECTIVE Cost from the provider perspective are the actual expense of providing a product or service. Provider can be hospital, managed care organisation or private practice physicians From this perspective direct cost can be identified 13

14. PAYER PERSPECTIVE Payers include patient, insurance companies, employers or the government. In this perspective cost represent the charges for health care products and services allowed or reimbursed by the payer. The primary costs for a payer are direct in nature and secondary cost ( indirect cost ) such as lost of working hours, lower productivity at work site etc SOCIETAL PERSPECTIVE The perspective of the society is the broadest of all perspective because it is the only one consider the benefit to the society as a whole. Costs from this perspective include patient morbidity and mortality and the overall costs of giving and receiving medical care. An evaluation from this perspective include all the important consequences an individual could experience. 14

15. METHODS OF PHARMACOECONOMICS ECONOMIC EVALUATION METHODS Full economic evaluations Cost Minimization Analysis (CMA) Cost Benefit Analysis (CBA) Cost Effectiveness Analysis (CEA) Cost Utility Analysis (CUA) Partial economic evaluations Cost consequence analysis (CCA) or Cost outcome analysis (COA) Cost-of-illness (COI) evaluation HUMANISTIC EVALUATION METHODS Health Regulated Quality of Life (HRQOL) Patient preferences Patient satisfaction 15

16. ECONOMIC EVALUATION METHODS The choice of evaluation method depends on the nature of outcomes and the context in which the choice need to be made. The perspective of the analysis is important in the selection of the method. Three important factors for any economic analysis are, Identification and choice among alternatives Assessment of costs and consequences Decision making within the limited / fixed or available budgets 16

17. COST MINIMISATION ANALYSIS (CMA) Involves the determination of the least costly alternative when comparing two or more treatment alternatives. After confirming the equivalency in outcome, the cost can be identified, measured and compared in terms of money. It is a relatively simple and direct method for comparing competing treatment alternative. Example: If drugs A and B are antiulcer agents equivalent in efficacy and adverse drug reactions (ADRs), then the costs of using these drugs could be compared using CMA. Another example would be prescribing a generic preparation instead of the brand leader. 17

18. COST BENEFIT ANALYSIS (CBA) CBA of medical care compares the cost of medical intervention to its benefit. It facilitates for identification, measurement and comparison of the benefits and cost of a program or treatment alternative. Cost and benefits are measured in same unit of money. Costs and benefits are expressed as a ratio (a benefit-to-cost (B:C) ratio). Many CBA’s measure and quantify direct costs and direct benefits only due to difficulties in measuring indirect and intangible benefits. It is a difficult task to covert the benefits or outcomes in terms of money value so it is preferably done by economists 18

19. COST OF ILLNESS EVALUATION ( COI ) Also know as Burden of disease. It is a method used to identify and estimate the overall cost of particular disease for a defined population. It involves measuring the direct and indirect cost attributable to a specific disease. COI evaluation is not used to compare competing treatment programs or treatment alternative. It is used to provide an estimation of financial burden of a disease. Application COI is used by policy makers and other government organization. Published COI reports are used in law suits to recover medical insurance claims. 19

20. HUMANISTIC EVALUATION METHOD Methods for evaluating the impact of disease and treatment of disease on a patient’s quality of life, patient preferences, and patient satisfaction are all growing in popularity and application to pharmacotherapy decisions. Health related quality of life has been defined as the assessment of the functional effects of illness and its consequent therapy as perceived by the patient. These effects often are displayed as physical, emotional, and social effects on the patient. Health related quality of life can be measured with the help of structured questionnaires filled by patients 20

21. APPLICATION Principles of pharmacoeconomics were applied in the field of hospital pharmacy activities. Thus cost effective data used for addition, deletion of a drug to or from hospital formulary. Help in the rationalization of drug procurement system in the country and for practical implementation of the standard treatment protocols and policies related to medicines. Development and implantation of protocols and guidelines based on pharmacoeconomic data have a great impact in influencing prescribing patterns and help in promote appropriate and cost effective use of medicine throughout the health care system 21

22. LIMITATIONS OF PHARMACOECONOMICS STUDIES Most of Pharmacoeconomic evaluations are conducted by pharmaceutical companies with commercial interest in ensuring their products, so chance for bias. The economic implications of the study would differ depending upon the perspective being evaluated. Pharmacoeconomic evaluation analysis conducted in one country cannot be expected to applicable in other countries due to the basic difference in money value, exchange rate of money, cost and outcome approaches etc No uniformity in the design and analysis of PE studies 22

23. CONCLUSION Pharmacoeconomics is comparatively a young science in health care which is still in the trial test of its methodologies. It focus on the cost and benefits of drug therapy. Pharmacoeconomics evaluations provide a basis for resource allocation and utilization and are important for health policy decision making. 23

24. REFERENCE K G Revikumar , B D Miglani , A Textbook of Pharmacy Practice, 1 st edition, Page No 443 -484 24

25. Thank You 25