Cost-effectiveness Analysis - CEA in Pharmacoeconomics

CEA in Pharmacoeconomics

In the context of pharmacoeconomics, the cost-effectiveness of a therapeutic or preventive intervention is the ratio of the cost of the intervention to a relevant measure of its effect. Cost refers to the resource expended for the intervention, usually measured in monetary terms such as dollars or pounds. The measure of effects depends on the intervention being considered. Examples include the number of people cured of a disease, the mm Hg reduction in diastolic blood pressure and the number of symptom-free days experienced by a patient. The selection of the appropriate effect measure should be based on clinical judgement in the context of the intervention being considered.

A special case of CEA is cost-utility analysis, where the effects are measured in terms of years of full health lived, using a measure such as quality-adjusted life years or disability-adjusted life years. Cost-effectiveness is typically expressed as an incremental cost-effectiveness ratio (ICER), the ratio of change in costs to the change in effects. A complete compilation of cost-utility analyses in the peer reviewed medical literature is available from the Cost-Effectiveness Analysis Registry website.

A 1995 study of the cost-effectiveness of over 500 life-saving medical interventions found that the median cost per intervention was $42,000 per life-year saved. A 2006 systematic review found that industry-funded studies often concluded with cost effective ratios below $20,000 per QALY and low quality studies and those conducted outside the US and EU were less likely to be below this threshold. While the two conclusions of this article may indicate that industry-funded ICER measures are lower methodological quality than those published by non-industry sources, there is also a possibility that, due to the nature of retrospective or other non-public work, publication bias may exist rather than methodology biases. There may be incentive for an organization not to develop or publish an analysis that does not demonstrate the value of their product. Additionally, peer reviewed journal articles should have a strong and defendable methodology, as that is the expectation of the peer-review process.