Use of centrally developed pharmacoeconomic assessments for local formulary decisions

Patented drug extension strategies on healthcare spending: a cost-evaluation analysis

BACKGROUND

Drug manufacturers have developed "evergreening" strategies to compete with generic medication after patent termination. These include marketing of slightly modified follow-on drugs. We aimed to estimate the financial impact of these drugs on overall healthcare costs and also to examine the impact of listing these drugs in hospital restrictive drug formularies (RDFs) on the healthcare system as a whole ("spillover effect").

METHODS AND FINDINGS

We used hospital and community pharmacy invoice office data in the Swiss canton of Geneva to calculate utilisation of eight follow-on drugs in defined daily doses between 2000 and 2008. "Extra costs" were calculated for three different scenarios assuming replacement with the corresponding generic equivalent for prescriptions of (1) all brand (i.e., initially patented) drugs, (2) all follow-on drugs, or (3) brand and follow-on drugs. To examine the financial spillover effect we calculated a monthly follow-on drug market share in defined daily doses for medications prescribed by hospital physicians but dispensed in community pharmacies, in comparison to drugs prescribed by non-hospital physicians in the community. Estimated "extra costs" over the study period were €15.9 (95% CI 15.5; 16.2) million for scenario 1, €14.4 (95% CI 14.1; 14.7) million for scenario 2, and €30.3 (95% CI 29.8; 30.8) million for scenario 3. The impact of strictly switching all patients using proton-pump inhibitors to esomeprazole at admission resulted in a spillover "extra cost" of €330,300 (95% CI 276,100; 383,800), whereas strictly switching to generic cetirizine resulted in savings of €7,700 (95% CI 4,100; 11,100). Overall we estimated that the RDF resulted in "extra costs" of €503,600 (95% CI 444,500; 563,100).

CONCLUSIONS

Evergreening strategies have been successful in maintaining market share in Geneva, offsetting competition by generics and cost containment policies. Hospitals may be contributing to increased overall healthcare costs by listing follow-on drugs in their RDF. Therefore, healthcare providers and policy makers should be aware of the impact of evergreening strategies.

Variability in activity and results from drug assessments by pharmacy and therapeutics committees in Spanish hospitals

OBJECTIVE

To quantify the Spanish Pharmacy and Therapeutics Committees (P&TC) activity with regard to assessing and selecting drugs and describing variability in decisions made to include them.

METHOD

Descriptive, cross-sectional study based on a questionnaire aimed to 513 hospitals with more than 75 beds. We included questions referring to the P&TC resolutions, the therapeutic positioning and assessment reports. Recruitment was carried out between November 2007 and January 2008. Variability among P&TC conclusions were presented in five categories or levels of coincidence.

RESULTS

One hundred and seventy-five hospitals participated, with a response rate of 34% (54% of beds). The mean (SD) number of drug-indications assessed per hospital was 10.35 (7.45). The proportion of assessments that conclude with drug inclusion or rejection was 75.3 and 21.4%, respectively. 16.2% concluded with therapeutic equivalence. Conditions for use were established for 64% of them, and 33% were included in a clinical guide. With regard to variability, 81.0% of assessments coincided with the conclusion to include or reject the drug. A contradictory decision was made for 19.0%.

CONCLUSIONS

Drug assessment and selection activity in hospitals involve an amount of work. The proportion of drugs approved is similar in different types of hospitals. There is extensive variability as regards deciding upon inclusion and is similar to studies conducted in other countries. They indicate that a standardising methodology would be recommendable.

Literature review on the structure and operation of Pharmacy and Therapeutics Committees

AIM OF THE REVIEW

To review the literature on the structure and operation of hospital Pharmacy and Therapeutics Committees from an international point of view and examine the factors that influence decision-making of these committees.

METHOD

We performed a literature search in the Medline and Embase databases from 1997 to January 2009 with the search terms: formulary system decision making, pharmacy and therapeutics committee, formularies hospital, drug formulary, survey, drug selection and outcome assessment health care. Inclusion criteria were the following: studies analyzing Pharmacy and Therapeutics Committees published in English or Spanish from 1997 to January 2009. Exclusion criteria were: publications which were editorials or opinion pieces, studies relating to one hospital, and studies where full text could not be attained. The analysis was divided into structural/organizational data and data on factors affecting the decision-making process.

RESULTS

Seventeen studies met the inclusion criteria. Pharmacy and Therapeutics Committees and formularies were present in more than 90% of the hospitals in four of the five countries examined. Therapeutic interchange programs existed only in two of these countries. The mean number of committee members ranged between six and eight. More than 89% of the committees included a pharmacist. Standard operating procedures were implemented by 89% of the committees. The most influential factors in the decision-making were clinical trial results or drug costs rather than pharmacoeconomic studies. Other local organization-dependent factors were also important.

CONCLUSIONS

The structure and operating procedures of Hospital Pharmacy and Therapeutics Committees are similar in select Western countries. Information from clinical trials is the most influential factor in the decision-making process.

The role of pharmacoeconomics in formulary decision making in different hospitals in Riyadh, Saudi Arabia

OBJECTIVE

To assess the trend of using pharmacoeconomic information by Pharmacy and Therapeutics (P&T) committees when making formulary decisions.

DESIGN

A cross-sectional study conducted in 2007, using structured survey questionnaires which were distributed to members of the P&T committees in 11 different hospitals in Riyadh, Saudi Arabia.

RESULTS

A total of 100 survey questionnaires were sent to head of pharmacy departments of 11 different hospitals in Riyadh, Saudi Arabia. Out of these, 48 questionnaires were completed and returned. Of the total respondents participated in the study, 64.58% were medical doctors and 16.66% were pharmacists and 75% of the respondents said they have applied pharmacoeconomic evaluations in their decision making process. More than 80% of the respondents perceived that they had a fair knowledge of pharmacoeconomics. Approximately 80% of respondents expressed some degree of agreement that pharmacoeconomics should be applied as a decision making tool. The majority of decision-makers (95%) expressed the interest in attending workshops on pharmacoeconomics.

CONCLUSION

The study showed that pharmacoeconomics can play an important role in the P&T committee formulary decisions. However, more education to health care professionals and to hospital administrators should be conducted to facilitate the use of such a tool. Also, hospitals should recruit health care professionals with pharmacoeconomic expertise to manage limited health resources in the best way available.

"Price management" and its impact on hospital pharmaceutical expenditure and the availability of medicines in New Zealand hospitals

OBJECTIVES

In 2002, the Pharmaceutical Management Agency (PHARMAC) began negotiating new price contracts for 90% of hospital pharmaceuticals on behalf of all New Zealand (NZ) public hospitals ("price management"[PM]). The present study was undertaken to examine the impact of 3 years of PM on hospital pharmaceutical expenditure, and the impact of the new contracts on the availability of medicines.

METHODS

Annual savings for 29 major public hospitals (financial years 2003/4 to 2005/6) were calculated from the data from 11 hospitals and data from PHARMAC. Inpatient and total hospital pharmaceutical expenditure (IPE, THPE) (2000/1 to 2005/6) were calculated from the data from 23 hospitals. Hospital pharmaceutical expenditure (2000/1 to 2005/6) was compared with community pharmaceutical expenditure (CPE) in NZ, and with THPE in the UK, Canada, Norway, and Sweden. Surveys were undertaken (2004, 2005) to examine any changes in medicine availability resulting from the new contracts.

RESULTS

Annual savings were NZ$7.84 million (m) to NZ$13.45m (2003/4 to 2005/6). Growth in IPE slowed for all hospitals in 2003 to 2004. Mean growth was higher for IPE and THPE than for CPE (8.8%, 9.7% vs. 1.9%). Mean growth in THPE appeared slightly lower in NZ (9.6%) and Norway (7.3%) than in the UK 14%, Sweden 12.5%, or Canada 10.2%. Some availability problems occurred with new contract items ("out-of-stocks"; products perceived as inferior). Problems were usually resolved in weeks, but some took more than a year.

CONCLUSION

PM was moderately successful saving NZ$8m to NZ$13m (6-8%) in 2003/4 to 2005/6 and slowing growth in IPE in 2003/4. Further research should examine whether the favorable economic effects can be sustained while unfavorable effects are minimized.

Self-reported healthcare decision-makers' attitudes towards economic evaluations of medical technologies

BACKGROUND

Increasing costs have generated concern among governments and healthcare providers who have realized the need for cost containment measures and more efficient resource utilization. Health economics is one potential source of information that can make healthcare more efficient.

SCOPE

This review article summarizes the published literature on self-reported attitudes of healthcare decision-makers towards economic evaluations of medical technologies and examines the extent to which economic evaluations are used in health policy decisions.

METHODS

A systematic literature review of published English language studies was conducted using MEDLINE, EMBASE, and HEED from January 1995 to December 2007.

FINDINGS

Fifty-five articles investigated the use of economic evaluations on three levels of decision-making: central, local, and physician level. Results indicate the use of economic evaluation information increased from limited/minor to moderate use. The influence of economic evaluations increased with the level of centralization of healthcare system. Barriers to use health economics research varied across levels and included health economics research-related barriers such as timely availability, lack of credibility, insufficient methodological quality and decision-context-related barriers including limited decision makers' knowledge, inflexibility in healthcare budgets and variability among healthcare organizations.

CONCLUSIONS

For consistent policy-making it is important that similar recommendations for cost-effective interventions and programs are developed at all levels and that implementation is promoted by incorporating the appropriate incentives in healthcare provision.