HEALTH SYSTEMS RESEARCH Edited by K. Davis and W. van Eimeren

W. van Eimeren B. Horisberger (Eds.)

Socioeconomic Evaluation of Drug Therapy

With 52 Figures

Springer-Verlag Berlin Heidelberg New York London Paris Tokyo

Prof. Dr. Wilhelm van Eimeren MEDIS Ingolstiidter LandstraBe 1

D-8042 Neuherberg

Dr. Bruno Horisberger Interdisciplinary Research Centre for Public Health Rorschacher StraBe 103 C

CH-9007 St. Gallen

ISBN-13: 978-3-642-64811-3 e-ISBN-13: 978-3-642-61366-1 DOl: 10.1007/978-3-642-61366-1

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© Springer-Verlag Berlin Heidelberg 1988 Soft cover reprint of the hardcover 1st edition 1988

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Preface

In past decades little attention was paid to the social and economic dimensions of health care. Health as a basic human need was mainly assessed from a clinical point of view. In addition, the dominant assumption was that the demand for health services is limited and calculable. The conclusion was drawn that the necessary financial resour­ces would be both available and forthcoming.

Reality has shown this conclusion to be illusory. Health expengiture in all countries has roughly doubled as a proportion of national wealth in the past 25 years, and the proportion may double again in the next 25. By the year 2010 U. S. citizens may on average be spending one dollar out of every five on health care. Consequently there is worldwide concern over the best and most appropriate ways in which resources should be allocated in the health care sector. This concern has led decision-makers and opinion leaders to consider ways of subjecting health care practices to closer social and economic scrutiny. For pharmaceutical preparations, for example, it is no longer sufficient to demonstrate quality, efficacy, and safety. Increasingly attention is focu­sed on additional parameters: Notably, evidence of cost-benefit and quality of life. In an era of rapidly rising health care costs, choices are inevitably going to be made on therapeutic as well as on economic grounds. In addition, however, it will be manda­tory to show that the benefits of a medicine, in terms of savings in other health care resources or in improved health, justify the costs, and that the product fulfills the basic efficiency requirement of "value for money."

To discuss these trends and latest developments in the socioeconomic evaluation of drug therapy, the Interdisciplinary Research Centre for Public Health, St. Gallen, and HealthEcon Ltd., Basel, in a joint effort organized a symposium in Wolfs berg , on the shores of Lake Constance. This symposium strengthens the tradition of Wolfsberg meetings dealing with issues of health care, e. g., cost sharing and technology assess­ment. An international group of experts in medicine, economics, epidemiology, and sociology were invited to present actual results of their studies and open them to interdisciplinary exchange of views. The meeting, whose proceedings are recorded in this book, provided a unique platform for the discussion of the background, the potential, and the limitations of socioeconomic appraisal of drug therapy. The papers presented are divided into four parts.

Part I gives an introduction to the role of economics in drug therapy. Some papers profile the changing landscape of economy and medicine as it affects the economies of health and pharmaceutical industries. They focus on how care is organized and paid for, especially in regard to pharmacotherapy. Examples illustrate how cost-effective­ness and quality of life considerations influence decisions about coverage, provision, and reimbursement for particular agents and products. Other papers cover basic

VI Preface

issues such as the pricing policy of the pharmaceutical industry and the social and economic implications of diseases. A concluding paper looks at some of the earlier ways in which drug therapy has been assessed and emphasizes the insensitivity and limited focus of traditional end points in regard to economic and social outcomes.

Socioeconomic evaluation of drug therapy cannot be carried out without attention to practical considerations. For the next two sessions a drug therapy was selected that had been subjected to extensive and differentiated evaluation: the transdermal thera­peutic system Nitroderm TIS. This patch was introduced to the market in 1982, placing at the disposal of doctors for the first time a preparation that enables nitrogly­cerin to be administered through the skin in a controlled dosage for the long-term prophylaxis of angina pectoris attacks. Because the costs per unit and per dosage of this system are higher than those for the traditional nitrate preparations in tablet, capsule, or ointment form, evidence had to be provided substantiating the product's "value for money." Today, Nitroderm TIS is, from the socioeconomic viewpoint, one of the most thoroughly analyzed innovations in drug therapy.

Part II deals predominantly with the economic criteria involved in measuring the effectiveness of drug ther~py. The first paper discusseslhe basic methodology and procedure of economic drug appraisal, pointing out the difficulties in employing an ideal study design. After a comprehensive overview of the studies to follow, several papers focus on description of single studies, their methodologies, and their results.

"If you want to know something about the patient's disease, you'd better stop asking the doctor, you'd better ask the patient." This statement opened the discussion at the symposium on the social and qualitative criteria involved in measuring the effectiveness of drugs, reported in Part III. Again, there is a paper outlining the basic approaches to measuring quality of life as well as other nonmonetary considerations, such as compliance and patient preference. Several papers which follow deal with empirical studies in different settings relevant to these subjects.

Each paper in the plenary session was followed by a discussion. In addition, after Parts II and III, a discussant summarized the key features of the different studies and tried to unify them. Also, discrepancies and methodological shortcomings were pointed out and placed in perspective. Of course, there is insufficient space for extended reporting of these contributions and personal interventions. The editors, instead, have sought to draw out the essence of the discussions in producing brief resumes placed at the end of Parts I, II, and III.

In Part IV the outlook for socioeconomic evaluation of drug therapy is discussed. The scientific, the societal, and the industrial points of view are presented.

Part V concludes the book with a gene1;al essay by the organizers of the symposium and with the curricula vitae of the authors. Part V also contains a very extensive index section for those who either seek specific information or want to follow a topic that the book itself does not use as a structural principle.

Acknowledgments

First of all we are obliged to the participants, whose papers and lively discussions made the symposium a success. Particular thanks go to the joint moderators of the three half-day sessions: Dr. B. Horisberger and Dr. R. Dinkel (part I), Dr. L. Read and Dr. B. Luce (part II), and Prof. S. Walker and Prof. C. R. B. Joyce (part III). Special appreciation is due to Susan Inderbinen, Gaby Lederer, and Alfred Geiser, who were responsible for all symposium logistics and secretarial work.

We owe a great debt to Ciba-Geigy, who supported the conference, and also to Prof. W. von Wartburg, who initiated it. Finally we owe a debt of gratitude to the European Office ofthe World Health Organization, for support and technical assi­stance in preparing and holding the symposium, and to Dr. Kaprio, special adviser to WHO Headquarters in Geneva, Switzerland, for his most valuable contribution.

Contents

Preface. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V

Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .'. . . . .. VII

List of Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. XIII

Opening Address: B. Roos . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Part I: The Role of Economics in Drug Therapy

1. The Changing Economic Milieu in the United States

D. NEUHAUSER .................................... 7

2. The Economic Milieu in Europe: View of the Common Market

R. HANKIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

3. The Economic Milieu in Europe: View of the Pharmaceutical Industry

D. TAYLOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 23

4. Pharmaceuticals and Decision-making in the United States: Cost Consciousness and the Changing Locus of Control

G. R. WILENSKY, L. J. BLUMBERG, and P. J. NEUMANN ............ 32

5. What Price Pharmaceutical Innovation?

P. ZWEIFEL ..................................... " 46

6. The Medical, Social, and Economic Implications of Disease

B.S.BLOOM ........... . . . . . . . .. . .. . . . . . .. . . . . . . .. 60

X Contents

7. From Medical to Socioeconomic Evaluation of Drug Therapy

J. L. READ ....................................... 72

8. Discussion of Part I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 82

Part H: Measuring the Effectiveness of Drug Therapy­The Economic Criteria

9. Cost-Effectiveness Study of Pharmaceuticals: Methodological Considerations

B. R. LUCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 87

10. The Impact of Angina Pectoris on the Patient and the Influence of Treatment

S.H. TAYLOR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 95

11. The Socioeconomic Study Program on Nitroderm ITS

P. LAUPER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 101

12. Cost - Cost Comparisons of Nitroderm ITS in Switzerland and Austria

R.H. DINKEL ..................................... 110

13. The Cost-Effectiveness of Transdermal Nitroglycerin in the Michigan Medicaid Program: A Preliminary Report

D.M. HUSE, G. OSTER, B.A. WEISBROD, J.L. READ, B.L. LUCE, and A. M. EpSTEIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 119

14. Cost-Benefit Analysis of Angina Prophylaxis in the Federal Republic of Germany

P.O. OBERENDER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 132

15. Discussion of Part II ................................ 141

Part ill: Measuring the Effectiveness of Drug Therapy -Social and Qualitative Criteria

16. Quality of Life - Principles and Methodology

Contents XI

S.R. WALKER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 151

17. Quality of Life in Angina Pectoris: A Swedish Randomized Cross-over Comparison Between Transiderm-Nitro and Long-Acting Oral Nitrates

B. JONSSON, S. BJORK, S. HOFVENDAHL, andJ.-E. LEVIN. . . . . . . . . .. 166

18. Transdermal Nitrate Therapy in Coronary Heart Disease from the Patient's Point of View - A Quality of Life Study in the Federal Republic of Germany

B. GfrrHER .......... ". . . . . . . . . . . . . . . . . . . . . . . . . . . .. 181

19. Angina Pectoris Prophylaxis and Quality of Life

H. SCHNEIDER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 188

20. Physician and Patient Preference

B. HORISBERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 198

21. Patient Compliance in the Prophylaxis of Angina Pectoris

E. WEBER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 209

22. Discussion of Part III . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 217

Part IV: Panel Discussion on the Outlook for Socioeconomic Evaluation of Drug Therapy

23. Outlook for Socioeconomic Evaluation of Drug Therapy: Sdence's Point of View

F. BE~KE ........................................ 223

24. Outlook for Socioeconomic Evaluation of Drug Therapy: Society'S Point of View

L. KAPRIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 226

XII Contents

25. Outlook for Socioeconomic Evaluation of Drug Therapy: The Company's Point of View

w. P. von WARTBURG. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 228

26. Editor's Note ..................................... 230

Part V: Envoi

27. Envoi

R. DINKEL, andB. HORISBERGER . . . . . . . . . . . . . . . . . . . . . . . . .. 235

28. Curriculum Vitae of Authors. . . . . . . . . . . . . . . . . . . . . . . . . . .. 236

Subject Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 241

List of Participants

Prof. FRITZ BESKE Institute for Health Systems Research, Beselerallee 41, D-2300 Kie11, Federal Republic of Germany

Dr. BERNARD S. BLOOM Research Associate Professor, University of Pennsylvania, Leonhard Davis Insti­

tute of Health Economics, Colonial Penn Centre, Philadelphia, PA 19104, USA

PETER F. CARPENTER President and Director Alza Development Corporation, 950 Page Mill Road, P.O. Box 10950,Palo Alto, California 94303-0802, USA

Dr. ROLF DINKEL Member of Management Committee, HealthEcon Ltd., SteinentorstraBe 19, CH-4051 Basel, Switzerland

Prof. WILHELM VAN EIMEREN MEDIS, Ingolstadter LandstraBe 1, D-8042 Neuherberg, Federal Republic of Germany

Prof. HANS FRIEBEL Temporary Adviser to WHO Regional Office for Europe, Copenhagen, UferstraBe 49, D-6900 Heidelberg, Federal Republic of Germany

Dr. TONI GRAF-BAUMANN Editor, Springer-Verlag, TiergartenstraBe 17, D-6900 Heidelberg 1, Federal Republic of Germany

Dr. B. GfuHER Infratest Health Research, Landsberger StraBe 338, D-8000 Munchen 21, Federal Republic of Germany

ROBERT HANKIN Commission of the European Communities, Directorate-General Ill/B/3, Rue de la Loi 200, B-1049 Brussels, Belgium

Dr. BRUNO HORISBERGER Interdisciplinary Research Centre for Public Health, Rorschacher Str. 103C, CH-9007 St. Gallen, Switzerland

Prof. BENGT JONSSON Link6ping University, Centre for Medical Technology Assessment, S-58183 Link6ping, Sweden

XIV List of Participants

Prof. C.R.B. JOYCE Head of Project Innovation, Ciba-Geigy Ltd., CH-4002 Basel, Switzerland

Dr. LEO KAPRIO Special Adviser to the Director General, Headquarters, World Health Organization, Av. Appia 20, CH-1211 Geneva 27, Switzerland

Prof. BENNO KONIG Johann-Gutenberg-University Mainz, Am Pulverturm 13, D-6500 Mainz 1, Federal Republic of Germany

Dr. PETER LAUPER Head of Pharma Economics, Ciba-Geigy Ltd., CH-4002 Basel, Switzerland

DAVID LOSHAK Medical Writer, 169 Half Moon Lane, London SE24 9JG, Great Britain

Dr. BRYAN R. LUCE Senior Research Scientist, Battelle, Human Affairs Research Centers, 2030 M Street N. W., Washington, D. C. 20036-3391, USA

Dr. MARIE E. MICHNICH Associate Executive Vice President, American College of Cardiology, Old Georgetown Road, Bethesda, Maryland 20814, USA

Prof. DUNCAN NEUHAUSER Department of Epidemiology and Biostatistics, School of Medicine, Case Western Reserve University, Cleveland, Ohio 44106, USA

Prof. PETER O. OBERENDER University Bayreuth, Chair of Economics, D-8580 Bayreuth, Federal Republic of Germany

Dr. GERRY OSTER Policy Analysis Inc., 1577 Beacon Street, Brookline, MA 02146, USA

Dr. J. LEIGHTON READ New England Deaconess Hospital, 194 Pilgrim Road, Boston, Massachusetts 02215, USA

Prof. BEAT Roos Director, Swiss Federal Office of Public Health, Bollwerk 27, CH-3001 Bern, Switzerland

Dr. HEINZ SCHNEIDER Project Manager, HealthEcon Ltd., SteinentorstraBe 19, CH-4051 Basel, Switzerland

Dr. DAVID TAYLOR Director of Public and Economic Affairs, Association of the British Pharmaceutical Industry (ABPI), 12 Whitehall, London SW12 DY, Great Britain

Dr. STANLEY H. TAYLOR The General Infirmary at Leeds, Great George Street, Leeds LSI 3EX, Great Britain

Prof. W. P. VON WARTBURG Member of the Executive Committee, Ciba-Geigy Ltd., CH-4002 Basel, Switzerland

Prof. STUART R. WALKER

List of Participants XV

Director, Centre for Medicines Research, Woodmansterne Road, Carshalton, Surrey SM5 4DS, Great Britain

Prof. ELLEN WEBER Director of Clinical Pharmacology of Ludolf Krehl Clinic of the University of Heidelberg, BergheimerstraBe 56a, D-6900 Heidelberg, Federal Republic of Germany

Dr. GAIL R. WILENSKY Center of Health Affairs, Project HOPE, 2 Wisconsin Circle, Suite 500, Chevy Chase, MD 20815, USA

Prof. PETER ZWEIFEL Institute for Empirical Research in Economics, University of Zurich, KleinstraBe 15, CH-8008 Zurich, Switzerland