PHP13: INDICES FOR EVALUATION OF DRUG COST/UTILIZATION: EVERY SILVER LINING HAS A GRAY CLOUD

Abstract

OBJECTIVE: Given the high cost of pharmaceuticals, particularly ?blockbuster? drugs such as the COX-II inhibitors, the issue of value-for-dollar is an increasingly important one for managed care decision-makers. Due to the complexity of conducting full economic evaluations, it is often tempting to try to reduce such analyses to the most simplistic methods possible?either by assuming equal effectiveness of two drugs and performing a cost-minimization analysis, or by using an index of drug cost/utilization such as DDD (number of defined daily doses of a drug used in a population), PMPM (per member per month cost/utilization), PPPM (per patient per month cost/utilization), ADC (average daily cost of drug therapy), or DACON (daily average consumption of a drug in a population). If a partial economic evaluation based on drug cost/utilization is necessary or preferred, decision-makers should bear in mind the relative strengths and limitations of these approaches prior to making policy decisions. The objectives of this paper are: (1) to describe several indices of drug cost/utilization, (2) to discuss their strengths and limitations, (3) to provide illustrations of their use, and (4) to offer suggestions for appropriate interpretation. METHODS: Using numerical examples focusing on COX-II inhibitors, several indices of drug cost/utilization are described and compared, including DDD, PMPM, PPPM, ADC, and DACON. General limitations and assumptions of ?partial? economic evaluations based solely upon cost/utilization data are discussed, including assumptions of equal effectiveness, compliance, continuation and safety; as well as confounding by indication, severity of illness and time on market. RESULTS: Depending upon the index used, results (data) on drug cost/utilization for COX-II inhibitors vary. CONCLUSION: Numerous indices are used to describe and evaluate drug cost/utilization. Each has its own strengths and limitations, and must be interpreted in the appropriate context to best inform pharmaceutical policy decision-making.